Yesterday, after the market closed, Lakeland Resources Inc. (CVE:LK) (OTCMKTS:LRESF) published, in concert with its new joint venture partner Declan Resources Inc (CVE:LAN), the results of a RadonEx study that Lakeland completed on its Gibbons Creek Property in the northern part of the Athabasca Basin in Saskatchewan.
Jonathan Armes (President & CEO of Lakeland) noted the following yesterday:
“We are excited to report on these results today, as they confirm the potential for a significant uranium discovery at the Gibbons Creek Uranium Property. Of particular interest are the extremely high ‘Radon’ values reported by RadonEx, which to our knowledge, are the highest ever reported for the Athabasca Basin area.”
Lakeland Resources Inc. (CVE:LK) (OTCMKTS:LRESF)’s land-based RadonEx values are with 9.9 pCi (picocurie) around 10 times higher as what Fission Uranium Corp (CVE:FCU) (OTCMKTS:FCUUF) measured with their prolific Patterson Lake discovery. In the Athabasca Basin, it was proved numerous times historically: the higher the RadonEx values at surface, the higher uranium enrichment below the surface.
Additionally, yesterday’s press release reported that a recently conducted sampling program confirmed the presence of a whole field of radioactive boulders at the surface on the Gibbons Creek Property. Assays of 8 boulders were reported with values between 1% and 4.3% U3O8. The source of these many and high-grade boulders is likely to be on the property – the same was the case with other large and high-grade uranium deposits in the Athabasca Basin, including Fission Uranium’s latest Patterson Lake discovery.
On December 4, 2013, Lakeland Resources Inc. (CVE:LK) (OTCMKTS:LRESF) allowed Declan Resources Inc (CVE:LAN) to option 70% of Gibbons Creek by spending a total of $6.5 million for exploration over 4 years, paying $1.5 million in cash and issuing 11 million shares to Lakeland.
While Lakeland is currently valued with a market capitalization of solely $5 million, Declan Resources Inc (CVE:LAN) already trades at $16 million (figures before market opened today). However, Lakeland not only owns the Gibbons Creek Project, but also numerous other large and highly prospective uranium properties in the northern part of the basin, whereas Declan holds some precious metals claims in Sierra Leone and early-stage uranium claims in Canada. Despite their 70/30 joint venture, we assess Lakeland Resources Inc. (CVE:LK) (OTCMKTS:LRESF) with a higher value than Declan Resources Inc (CVE:LAN). We interpret this valuation backwardness as a short-term phenomenon and anticipate a distinct appreciation of Lakeland relative to Declan in the foreseeable future.
Declan Resources Inc (CVE:LAN) showed high volumes in Germany during the few last days and weeks; some 3 million shares were traded alone today in Frankfurt, which reflects the high volume on the TSX market today. Trading volumes of Lakeland Resources Inc. (CVE:LK) (OTCMKTS:LRESF) in Germany are somewhat smaller but more stable and constant, yet Lakeland has 100 million shares less in the market than Declan. This market tightness may result in a price escalation.
Lakeland (LK; 33 million shares out):
Declan (LAN; 133 million shares out):
Recently, we published 2 articles presenting why investors are focusing on the Athabasca Basin, why we are bullish for uranium prices, and why Lakeland is our favorite uranium play.
December, 5, 2013: “No Dead-Cat-Bounce – A Dead-Serious Warning From Uranium“
November 4, 2013: “Athabasca Basin – The Place To Be For The Upcoming Uranium Boom“
A few days ago, we did an interview with Ryan Fletcher of Lakeland:
• December 2013 was a good month for Lakeland shareholders, the stock more than doubled from 10.5 cents to 25.5 cents currently trading at 18 cents. Can you inform us what is behind this remarkable development?
“Yes, we are very encouraged that the market has started to get behind the company. In early 2013, we moved Lakeland Resources Inc. (CVE:LK) (OTCMKTS:LRESF) into the uranium space and focused our efforts on the Athabasca Basin. We saw the low in the uranium price, the great fundamental opportunity to position ourselves in the space, and quality people, projects and financial support and money were available, the opportunity was there. We put our heads down and went to work, hard. We started to put in long hours, and focus hard on meeting milestones and delivering for our shareholders, and this has helped to get us where we are at now and seeing some success in the market. The market seems to be awakening to us as a driven, hard-working group, with a shareholder first mentality and meeting milestones.
We acquired nine properties to start, commenced exploration at our flagship Gibbon’s Creek Property, and began to build out the board and team with individuals with successful track records in the space. We also recently announced a deal with Declan Resources Inc (CVE:LAN) where they can earn into our Gibbon’s Creek Property by spending $6.5 million over four years, including a minimum $1.25 million in 2014, the bulk of which will be in drilling commencing in the first quarter. We will be carried on the program, so I believe the market is waking up to the fact that we will be exposed to one of the larger drill programs in the Basin at the start of the year.“
• Please brief us about your latest team additions.
“Yes; in December there were a few new and important faces joining the Lakeland team. As we have moved ahead our exploration and property package we have also been very focused on building the company with the right group of people that can deliver for shareholders.
Early in the month, Canon Bryan was added as the forth member of our uranium advisory board. Canon is a uranium corporate development and M&A specalist and was involved in the founding of Uranium Energy Corp. (NYSEMKT:UEC) which went from a small start up like Lakeland to one of a handful of uranium producers in the United States and currently trades around US$1.80 with a market capitalization of $170 million. Canon has seen and keenly understands the elements required to build a successful company in the space and we are looking forward to his contributions.
We also added Sam Wong as CFO, he is a motivated and high calibre individual, ready to roll up his sleeves and get to work. He was formerly Corporate Controller of Luna Gold Corp. (TSE:LGC) and oversaw the company’s transition from development to commercial production and is currently CFO of Lowell Copper Ltd (CVE:JDL) in the copper space and Chesapeake Gold Corp. (CVE:CKG) in the precious metals space.
We also had Neil McCallum join our Board of Directors. Neil is a professional geologist and has about 10 years of experience in uranium exploration with a focus on the Athabasca Basin. Amongst other projects he was involved in the early stages of Fission Energy’s Waterbury Lake Property (J-Zone) which was recently sold to Denison Mines (TSX: DML) and the Patterson Lake Properties (now of Azincourt (TSX.V: AZZ) and Fission Uranium (TSX.V: FCU). He really understands how to evaluate and successfully explore and discover uranium in the Basin and will be a key technical director and contributor.
Finally, Ms. Frances Petryshen was