GTI options conversion is a sign that uranium is coming back on
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GTI has raised nearly $900,000 from the exercise of more than 29.8 million unlisted options at 3c and will direct the funds towards uranium exploration.
The exercise of options is indicative of strong support from existing shareholders and comes as uranium prices surged to a nine-year high of around US$50 per pound on Friday, a 70% year to date increase.
GTI Resources (ASX:GTR) expects to raise a further $2.14 million through a fully underwritten $1.54m entitlement offer and $600,000 vendor placement, giving it a cash balance of about $6.8m before acquisition and capital raising costs.
These funds will be used to fast track exploration on the Wyoming in situ recovery (ISR) uranium properties that it is inheriting as part of its acquisition of Branka Minerals and its existing Utah uranium properties.
It will also continue to evaluate additional opportunities to grow its uranium portfolio in the US as market conditions for the energy metal improve.
Drill targets have been identified at the Thor project in Wyoming and a field program is being finalised for its Utah project for execution during November and December.
“We are delighted with the support from our option holders who have converted their options to support the company’s future work programs, which are focused on creating value for all shareholders,” executive director Bruce Lane said.
“We are currently working on completing the acquisition of Branka and planning for the commencement of uranium exploration in Wyoming as soon as possible, whilst we hope to be drilling in the Great Divide Basin before Christmas.”
He added that the well documented uranium supply-demand imbalance appears to have been brought to a head with the aggressive purchasing of uranium on the spot market that was triggered by The Sprott Physical Uranium Trust.
“This spot price action comes at a time when the world is moving aggressively towards greatly reduced carbon emissions and we believe that nuclear power, and therefore uranium, is going to a significant part of achieving reduced carbon emissions,” Lane noted.
“This is especially true in the US where nuclear energy accounts for 50% of green energy production and is fundamental to provision of low carbon baseload electricity.”
This article was developed in collaboration with GTI Resources, a Stockhead advertiser at the time of publishing.
This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.