Blue Sky to sell up to 80% of Argentine uranium project to Corredor Americano

Canada's Blue Sky Uranium will sell up to 80% of its Ivana uranium and vanadium project in Argentina to local player Corredor Americano (Coam) to raise US$195mn for the initiative and advance it to commercial production.

Located in Río Negro province, the project is in the advanced exploration stage.

In line with a preliminary agreement signed in June, the financing will be used for exploratory work and a feasibility study, Blue Sky said in a statement on Monday that outline the details of the definitive earn-in agreement.

Coam, a oil services-focused company belonging to conglomerate Corporación América, will initially hold a 50% indirect stake in a joint venture that will include Blue Sky's subsidiaries, Minera Cielo Azul and Ivana Minerals, after making a payment of US$35mn.

Once the feasibility study is completed and if it is viable to begin construction of the deposit, which is part of the Amarillo Grande megaproject, Coam will be able to increase its shareholding to 80%.

Ivana has 19.7Mt of indicated mineral resources with an average grade of 333ppm uranium and 105ppm vanadium, and could produce 1.5mn pounds of uranium oxide annually over an 11-year mine life, according to an investor presentation from Blue Sky, which belongs to exploration company Grosso Group.

The agreement between Blue Sky and Corporación América is subject to a series of regulatory and shareholder approvals.

Blue Sky plans to hold a special meeting for shareholders in February to obtain authorization and move ahead with the capitalization of Ivana, which aims to become a key supplier to the nuclear power industry in Argentina.

The country has three nuclear plants, six research reactors and a uranium purification plant, among other assets. Nuclear capacity is expanding both domestically and internationally with expected strong demand for uranium as a critical input.

The full details of the earn-in agreement can be seen here.