Tuesday, July 12, 2005 THE surge in uranium stocks is continuing unabated with stocks such as Deep Yellow symptomatic of the strong investor interest in the sector.
Deep Yellow has set new highs for the past four consecutive days and has more than doubled its market cap from just over $20 million around two weeks ago to today's valuation of $54 million. The stock hit a new high of 15c today before dropping to 14c in late morning trade.
The company emerged from administration in December of last year and was trading at just 1.5c after switching commodities to focus on a couple of uranium projects in the Northern Territory.
Since then Deep Yellow has announced its intention for a major new drilling campaign at its Napperby project (which will lead to an initial resource estimate by September), acquired four new prospects in Tanzania, and also acquired the uranium rights to Tanami Gold's tenements in Northern Territory.
Managing director James Pratt and directors Gary Steinepreis and Hugh Warner have lead the company's resurrection since re-capitalisation in December last year.
In relation to a recent ASX 'speeding ticket', Steinepreis told MiningNews.net he believed the market was merely coming to terms with the recent deal with Tanami and the imminent resource estimate from Napperby – expected to be in the realms of 6000t of uranium oxide.
"I think there is two things people are focusing on with Deep Yellow. The first is that we are getting ready to undertake a drilling program in Napperby, basically taking the resource and making it JORC compliant," he said
"As well as that, by locking up the large area of land in the Tanami region people can see that we have a good foothold in a prospective uranium province."
Steinepreis said he believed there had also been a shift in the political climate surrounding uranium mining in Australia.
"There have been quite a lot of articles in the press about uranium, which we consider to be the energy of the future, and I think people are starting to take notice that there is a political change being talked about. There is a change in people's mindset about how uranium is used in terms of being an efficient energy source," he said.
Since the price query last week Deep Yellow's share price has surged from 8.6c to a high today of 15c, with massive volumes of shares being traded including 87 million on July 7.
A number of other juniors have followed suit in the past few weeks including Berkeley Resources whose share price jumped 45% to 16c on the back of deal relating to uranium tenements in Spain. The stock was trading at 20.5c in morning trade today.
Junior uranium explorer Hindmarsh Resources listed on the ASX yesterday and is currently trading at almost a 100% premium, 50c, to its issue price of 28c. The junior holds a uranium portfolio of around 9500sq.km in South Australia including joint venture's over three tenements in the highly prospective Gawler Craton with Southern Gold.
Shares in junior explorer Redport have also surged in the past month, jumping from just over 3c in June to be trading today at 7.6c.
Shares in African-focused uranium explorer Omegacorp were placed in a trading halt this morning after closing at 90c yesterday. The company holds a number of prospects in Zambia, Mozambique and Tanzania, which it expects to be drilling in the next few months.
Agincourt Resources uranium spin-off Nova Energy lodged its prospectus with ASIC and the ASX yesterday with the company seeking to raise $6 million in its IPO through the issue of 15 million shares at 40c each. Nova's exploration focus is on the Lake Way and Centipede uranium prospects in central Western Australia.
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