C29 Metals Secures Drilling Greenlight but Faces Ownership Transfer Roadblock
C29 Metals closes December quarter with $2.56 million cash and key drilling approvals for its Ulytau uranium project, but faces a significant hurdle after Ministerial refusal to transfer ownership of its Kazakhstan tenement.
- Strong cash position of $2.562 million at quarter end
- Received Category 2 drilling approval for Ulytau uranium project
- Ministerial approval to transfer Ulytau Resources ownership refused
- Exploration activities paused pending resolution of ownership issue
- Raised $2.45 million via placement to fund exploration and working capital
Financial Position and Capital Raise
C29 Metals Limited (ASX:C29) reported a solid cash position of $2.562 million as of 31 December 2024, bolstered by a well-supported placement that raised $2.45 million from sophisticated and professional investors. The placement was priced at $0.071 per share, reflecting confidence from the market with demand exceeding the shares offered. These funds are earmarked primarily for advancing exploration activities at the Ulytau uranium project in Kazakhstan and for general working capital.
Exploration Approvals and Activities
The quarter saw significant progress on the regulatory front with C29 Metals securing a Category 2 environmental permit, enabling the commencement of drilling at Ulytau. Additionally, Category 4 approval was granted for geological works excluding drilling on newly acquired northern and southern tenements. The company initiated airborne geophysical surveys over the Ulytau and southern tenements, employing advanced electromagnetic, magnetic, and radiometric techniques overseen by Intrepid Geophysics using the proprietary "Moksha" 2.5D inversion method, promising sophisticated subsurface insights.
Setback on Ownership Transfer
Despite these advances, C29 Metals encountered a significant regulatory challenge when the initial application for Ministerial approval to transfer ownership of Ulytau Resources Limited, the entity holding the Ulytau tenements, was refused at first instance. This refusal prompted Managing Director Shannon Green to travel to Almaty, Kazakhstan, to engage directly with government authorities and advisors to address concerns and seek resolution. In response, the company prudently paused exploration activities, including the planned drilling program, to conserve cash and maintain financial flexibility during this period of uncertainty.
Community Engagement and Strategic Positioning
C29 Metals continues to foster strong local community support in the Almaty region, particularly in the village of Aksuyek, which is positioned to serve as an operational base. The company has formalized a social support agreement with the district government, underscoring its commitment to sustainable and mutually beneficial development. This local backing could prove pivotal as the company navigates regulatory hurdles and advances its exploration agenda.
Corporate Developments and Outlook
During the quarter, C29 Metals appointed Jamie Myers as Executive Director for a fixed 12-month term, recognizing his instrumental role in acquiring the Ulytau project. The company also successfully conducted its 2024 Annual General Meeting with all resolutions passed. While the refusal of Ministerial approval introduces near-term uncertainty, the company’s strong cash reserves and strategic focus on resolving regulatory issues position it to resume exploration activities once approvals are secured.
Bottom Line?
C29 Metals’ ability to resolve the ownership transfer impasse will be critical to unlocking the full potential of its Ulytau uranium project and sustaining investor confidence.
Questions in the middle?
- What specific concerns led to the Ministerial refusal of the ownership transfer, and how might they be addressed?
- How long might the exploration pause last, and what impact will it have on the project timeline?
- Could the regulatory setback affect C29 Metals’ ability to raise further capital or attract partners?
