Aurora Energy Metals (ASX:1AE) will receive up to US$26 million in consideration for selling its titular Aurora Uranium Project.
The project was formerly a dual lithium-uranium play where stacked systems of mineralisation were of much hubbub. Then lithium prices tanked and uranium potential wasn’t as easily unlockable as Aurora had originally stated.
Trickle on a few years, and here we are. But there’s pause for thought in the way Aurora is handling the transaction.
The buyer is USA-based Eagle Energy Metals, which is soon to list on “a US Stock Exchange” (no mention where yet). When that occurs, Aurora will pick up a share consideration of US$16M (A$24.7M) in the company.
Through that exposure – and a 1% royalty – Aurora wrote on Tuesday, 1AE holders can remain tied to the project.
Further consideration of up to US10M (A$15.4M) in share considerations are to be clocked in when Eagle upgrades mineralisation estimates into the Measured & Indicated Resource, and, a further A$7.7M once a PFS is complete.
On top of that, there’s also $1.5M in option payments available to Aurora, including an initial A$460,000 worth. Across the option period, Eagle has committed to spent A$700,000 to keep progress flowing.
“Our option to acquire the Aurora Uranium Project represents a pivotal step in advancing America’s growing demand for clean, reliable energy,” Eagle Energy Metals CEO Mark Mukhijas said.
Aurora Chair Peter Lester, meanwhile, was more specific.
“The company has been seeking to transition the management of the Aurora Uranium Project to a US based team with strong mining and uranium experience,” Lester mused.
“We believe this will progress development more effectively and maximise value, not the least of which will be through maintaining upside exposure to the AUP for our shareholders through a significant interest in the US listed entity.”
All said done, Aurora will end up holding some 40% in Eagle.
1AE last traded at 4.3cps.
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