Expanding Footprint & Drilling Ahead in the Athabasca Basin

Report Highlights

• The 2025 drill program (totaling 10,000 to 11,000 m) at the Russell Lake project, a JV with Rio Tinto (NYSE: RIO), aims to follow up on the promising results of recent exploration programs, with phase one drilling (5,000 m) focusing on three target areas. 
• At its 100%-owned Moore uranium project, SYH plans to complete a follow-up drill program, totaling 5,000 to 7,000 m. Management is awaiting assay results of a recently completed drill program. 
• Management aims to complete maiden resource estimates on both projects this year. 
• Option partners are actively advancing their projects through exploration and drill campaigns. SYH could receive up to $34M in cash/share payments if these option agreements are fulfilled.
• Key recent sector developments include: a) Paladin Energy's (ASX: PDN, MCAP: US$3B) acquisition of Fission Uranium, a Canadian uranium explorer and developer, for $1.1B; b) the U.S. Nuclear Regulatory Commission's approval of Urenco’s plan (a global nuclear fuel company) to increase uranium enrichment levels at its New Mexico facility; and c) the Swedish government potentially lifting its ban on uranium mining. We believe these developments highlight the increasing significance of uranium as a critical energy source.
• Tech giants like  Google (NASDAQ: GOOGL), Microsoft (NASDAQ: MSFT), and Amazon (NASDAQ: AMZN) are increasingly turning to nuclear power to fuel their data centers and AI initiatives. We believe the growing demand for nuclear energy, coupled with geopolitical uncertainties surrounding uranium supply chains, will drive industry consolidation through M&A. 
• SYH maintains a strong balance sheet. Upcoming catalysts include positive sentiment on uranium juniors, drilling at Russell Lake and Moore, ongoing and planned exploration programs by its partners, and potential new option agreements to advance its prospect generator business.

*Subsequent to FY2025 (6M), SYH closed a $10M financing in December 2024

Price Performance (1-year)

Portfolio Summary

36 properties, covering 614,353 hectares, in the Athabasca basin. The Athabasca basin hosts some of the world’s richest uranium deposits and mines

Nine projects with JV/ option agreements. Partners could commit up to $36M for exploration, and over $34M in cash/share payments to SYH

Earlier this month, SYH staked seven early-stage uranium claims in Northern Saskathewan. Management is seeking JV partners to advance these projects.

Seven prospects covering 70,073 hectares. Foster is 20 km east of Cameco’s (TSX: CCO) key Lake operations. Horton is 34 km south, while Lynx is 54 km south of Cameco’s Rabbit Lake operation

Russell Lake Uranium Project (SYH 51%: Rio Tinto 49%)

SYH is planning to conduct a multi-phase drill program totaling 10,000 to 11,000 m (18-20 holes) this year. 

Russell Lake is strategically located between SYH’s Moore uranium project, and Denison’s (TSX: DML) Wheeler River project, and close to Cameco’s (TSX: CCO) Key Lake mill, and MacArthur River mines. 35+ km of untested targets 

Phase one drilling (5,000 m/ 10-12 holes) will focus on the Fork and Sphinx targets within the Grayling zone, the M-Zone Extension (MZE), and the Fox Lake zone

SYH recently completed a fall drill program (eight holes totaling 4,500 m), aimed at expanding a high-grade zone at Fork, and assessing regional targets.

Management is awaiting assay results from the 2024 fall drill program. The company aims to complete a maiden resource estimate this year

Moore Lake Uranium Project

SYH plans to drill 5,000-7,000 m (18–24 holes) across several untested sections of the 4.7 km long Maverick Corridor, along with follow-up drilling on the Maverick Main and East zones.

Moore is located 15 km east of Denison’s (TSX: DML) Wheeler River project, and 39 km south of Cameco’s McArthur River mine. The 4.7 km long Maverick corridor hosts numerous targets 

SYH recently completed a drill program (nine holes totaling 2,800 m), aimed at potentially expanding the high-grade uranium mineralization at the Main Maverick and Maverick East zones.

Awaiting assay results. The company aims to complete a maiden resource estimate this year

Updates on Other Projects 

At the South Falcon East uranium project, Terra Clean Energy (CSE: TCEC, MCAP: $2M) has signed an exploration agreement with the English River First Nation, and secured permits for its 2025 winter exploration program, which includes a 2,000 m drill campaign with an estimated budget of $1.5M.

Financials  

Strong balance sheet. In December 2024, SYH closed a $10M equity financing 

FRC Valuation

Uranium juniors in North America are trading at $8.1/lb (previously $8.8/lb). Uranium juniors in North America are trading at 2.5x book value (previously 3.0x

Applying sector multiples to SYH’s flagship assets, we arrived at a revised fair value estimate of $1.02/share (previously $1.21/share). Our valuation decreased primarily due to lower sector multiples, and share dilution from the recent financing

We are reiterating our BUY rating, while adjusting our fair value estimate from $1.21 to $1.02/share. SYH has made significant strides since our last report, including a substantial equity financing, and portfolio expansion. The company has announced plans to pursue ambitious drilling programs at its flagship projects. Upcoming catalysts include drill results, maiden resource estimates, and potential option agreements.

Risks

Maintaining our risk rating of 5 (Highly Speculative)

We believe the company is exposed to the following key risks (not exhaustive):

• The value of the company is dependent on uranium prices
• Exploration and development 
• None of its flagship projects have a NI 43-101 compliant resource estimate
• Access to capital and share dilution 
• No guarantee that option partners will follow through with their proposed programs