“The copper demand is primarily being driven by the hot EV market. Meanwhile, the paradigm shift to recognize uranium as the green source of energy has led institutions like Sprott Physical Uranium Trust to increase their physical uranium holdings,” noted Red Cloud analysts
GoviEx Uranium Inc (TSX-V:GXU, OTCQX:GVXXF) has ‘well-timed’ its decision to explore its Falea project in Mali as the fundamentals for copper and uranium improve.
That’s the view of broker Red Cloud Securities, which rates shares a ‘Buy’ after the company announced a 6,000 metre (m) drill program at the polymetallic asset.
“The copper demand is primarily being driven by the hot EV market. Meanwhile, the paradigm shift to recognize uranium as the green source of energy has led institutions like Sprott Physical Uranium Trust (SPUT) to increase their physical uranium holdings,” noted Red Cloud analysts.
The Falea project comprises three exploration licenses: Falea, Bala and Madini in southwest Mali sits along strike to a number of gold mines and exploration projects and the Saraya East uranium project in Senegal.
The drilling will focus on targets based mainly on induced polarisation (IP) surveys at Falea in 2020 and 2021.
The broker also noted that it was now “business as usual” in Mali after West Africa’s economic bloc had imposed sanctions on the country for refusing to hold elections in the near term
“While the southern borders are closed, we note that borders to the north and with Guinea remain open, ensuring the flow of necessary supplies. Although the country remains in a state of emergency, there seem to be no immediate issues for GoviEx other than some delays,” analysts said.
Red Cloud Securities has a price target of C$0.60 on GoviEx shares, which is double the current price of C$0.30.
