Last week I caught up with Niko Cacos, President and CEO of Blue Sky Uranium. We talked about the uranium market, the potential that Blue Sky Uranium offers investors, and why the recent price rise in vanadium will only continue to help their deposit.
Welcome back to another episode of The Next Bull Market Move. I have a brand new guest, he is the president and CEO of Blue Sky Uranium, Niko Cacos. How are you today, Niko?
I'm doing great, Kerem. Thank you for having me.
Let's begin by talking about the uranium market and the upward move in the spot price over the last 12 months. What does this signal to you for the uranium market going forward and do you think we'll see a continuation of an upward move in the spot price this year?
I believe we will. Yes. The move last year has been nearly a 50 percent increase in the price of uranium. Gone from just over $20 a pound up to just under $30 a pound.
That's quite a significant move and we're still going to see that momentum going forward in 2019 because I think we're continuing to see a big demand in uranium. New nuclear reactors being built around the world and there's going to be more, continuously more uranium demand required.
Let's talk about your company, Blue Sky Uranium. Give us some background to the story and how you're positioning yourself for a new bull market in uranium. I understand you have a very large land package in Argentina with a number of deposits that are near surface. Is that correct?
That is correct. What we have in Argentina is probably the most significant uranium discovery in the world today. It's not just a discovery of a single deposit, but we believe we've discovered a new uranium district. Currently we've got a 43-101 compliant resource of just under 20 million pounds of uranium and just under 10 million pounds of vanadium.
So that in itself is a fairly significant deposit. But what we're seeing is that this land package extends from north to south, almost 150 kilometers long. And it's a zone that is about 50 kilometers wide. So in this entire land package, we've been seeing uranium occurrences throughout the entire strike length. This is a very large area. Like I said, it's a new district. And we've focused on doing our exploration work and our discovery work, starting with the most obvious places first.
And as we're stepping out from where we know we've got our uranium, we're discovering more and more uranium. So we're very excited about the upside. There's a lot of room here for big expansion and the fact that the uranium sits up close to surface makes it very significant from an economic point of view because it means it can be extracted very cheaply.
This deposit that we have is very similar to what you're seeing in Kazakhstan and the Inkai deposit, which is one of the world's largest and lowest cost uranium mines. We think that we've got something similar here in Argentina.
So can you give us some details about the vanadium that's associated with your project? If investors are looking for a company with vanadium exposure, would Blue Sky fit that criteria?
Blue Sky would most certainly fit that criteria. You know, it's quite interesting. A few years back we were discovering that there was some vanadium associated with the uranium. In some cases - four or five pounds of vanadium for every pound of uranium that we found.
And because it was only trading at around three or four dollars a pound, it was a nice economic afterthought. But now we've seen the price of a vanadium top $30 and now it's trading around $15 to $20. It's a very significant component of this deposit and what we're doing right now is we've undertaken a preliminary economic analysis to evaluate the economics of producing both metals in this deposit.
Jurisdiction and infrastructure are very important aspects for mining projects that are in the process of being de-risked. So can you give us a quick overview on the infrastructure surrounding your project and why Argentina has become come very mining friendly over the last few years?
Well, Argentina opened up for mining in the last 25 years. Prior to that, there was no mining in that country at all. And we've been active in that country ever since. So in that respect, we consider our group and our team here as experts in operating in Argentina. We love operating in Argentina.
The opportunities there are tremendous. In terms of the recent government, the last couple of years, are very pro business friendly and very much promoting the development of its mining industry. So it's a great jurisdiction in which to be involved. But secondly, how it positively affects Blue Sky, is that Argentina is a uranium country.
It's a nuclear power country. Currently, it's got three nuclear power plants in operation. They've got research reactors, particle accelerators and so forth. There's another new nuclear power plant now in construction and they're importing all of their uranium.
And their primary goal is to source a domestic source of uranium and we hope Blue Sky is to be the ones to provide that. And further, Kerem, if I can add - in the province where we're actually active - in the province of Rio Negro - is a very strong nuclear jurisdiction.
There's a government owned research nuclear institute and they build and export nuclear reactors around the world. They're actually quite well known and we've been working very closely with them, doing a lot of metallurgical and other types of work with them. We've developed a very good close partnership with the provincial and the federal government and we're seeing a very good path forward here.
And finally, is there anything else you'd like to tell us about Blue Sky or about the uranium market in general?
Well, the uranium market has been riding the low's for a long time. But with Blue Sky we've been working on this project, this discovery of Amarillo Grande, for some time now. In the last few years, despite the low prices of uranium, we as management have always known that we were onto something really quite significant.
As the price of uranium begins to go up it only bodes very well for our company and our shareholders and I believe our deposit is going to get much, much bigger and it's going to attract international attention. I think the fun is just about to begin.
Excellent. Thank you very much Niko, and we'll have you on the show again very soon.
Great. Thank you.
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I am a current shareholder of Blue Sky Uranium.