NXE – NexGen Begins 6,000m Drill Campaign at Rook I

The focus of the 2014 program remains the area immediately northeast of the Patterson Lake South discovery (Image: NexGen Energy)

This morning, NexGen Energy (NXE:TSXV) announced the uranium explorer has begun their winter drill program at their Rook I project immediately adjacent to and northwest of Fission's Patterson Lake South deposit. The company has outlined a 6,000m drill campaign with two drill rigs. NexGen has identified multiple targets from their 2013 summer drill campaign where they intersected uranium mineralization in three holes covering a 1.6km by 1.2km area, covering the interpreted extension of the Patterson Lake South 3B conductor.

Management expects to test targets identified by detailed geophysical surveys later in the program as well. The company completed VTEM and magnetic surveys as well as gravity and resistivity surveys. They also say that the company has identified more targets using aerial radiometric and EM surveys in late 2013. The company has also identified an area which they intend to complete a gravity survey on that is located to the north east of the Patterson Lake Discovery zone that is interpreted as a large structural zone.

Leigh Curyer, NexGen's CEO commented, "Rook I has multiple targets based on the results of the 2013 summer drilling program and previous geophysical programs conducted over the past two years . We are fully funded to execute this program, and look forward to another successful drill program over the coming months."

The stock has been trading sideways in the $0.30 to $0.25 range since October after falling from a high of $0.52 in August.

Here's the chart:

NXE data by YCharts

Expectations to make an immediate and major uranium discovery were high when NexGen first began trading in the summer of last year. In speaking with CEO Leigh Curyer last week, he said what they found in their initial program was better than they expected going into it. He is very excited about their chances for making a discovery.

Late last week, the company extended their work commitments for the Radio project with its optionors from May 31, 2015 to May 31, 2017. This allows the company to focus more immediate time and resources on Rook I, although the project remains a high priority for them. Now NexGen doesn't have to complete $10 million in work on Radio until the end of May 2017.

The company is sitting on $7.8 million in cash after raising $3 million in flow-through in late December. In this business there are management teams that spend movey on G&A and have very nice/large offices, and then there are teams that try and make every dollar add value to shareholders. Leigh and his team are the latter. They have a modest office and Leigh tells me they are targeting $1 dollar of G&A expense for every $10 of work on their projects by year-end.

They expect to spend $3 million on this winter campaign.

Read: NexGen Commences 6,000-Meter Winter Drilling Program at Rook I Project, Western Athabasca Basin, Saskatchewan

Travis McPherson

trav@ceo.ca

Travis McPherson

trav@ceo.ca

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