Hertz Energy to Spin Off Uranium Assets Amid Nuclear Energy Surge
FULL DISCLOSURE: This is sponsored content for Hertz Energy.
Hertz Energy Inc. (CSE: HZ) has officially announced its decision to spin out its uranium assets into a new stand-alone entity named Hertz Uranium. This move, which follows an extensive review by the company’s board and advisors, is aimed at unlocking greater value for shareholders and focusing Hertz Energy’s resources on its premier lithium projects in Quebec, Canada.
Hertz Energy’s announcement comes at a time when uranium is gaining significant global interest, bolstered by its rising prices and the nuclear energy renaissance.
We believe our uranium assets need to be in a stand-alone public company to fully realize their potential and to provide appropriate value to our shareholders.
CEO Kal Malhi
The reorganization includes the Cominco Uranium Project in Nunavut, Canada, and the Namibian Uranium Exclusive Prospecting License Applications. By transferring these assets to Hertz Uranium, the company aims to provide a focused vehicle for developing its uranium prospects.
The Cominco Uranium Project, located in Nunavut, covers approximately 5,192 hectares and includes the historically significant Pomie and Yon showings. These sites were initially explored in the mid-1970s by Cominco and Noranda. Recent reviews indicate that modern exploration technologies have not yet been applied, presenting a substantial opportunity for new discoveries.
Historical drilling results from the Pomie showing have shown promising uranium grades, with notable intersections such as 2.59 lbs U3O8/ton over 38 feet and 4.79 lbs U3O8/ton over 43 feet. These findings suggest that the area holds uranium mineralization potential, warranting further exploration and development.
Hertz Energy has also applied for Exclusive Prospecting Licenses (EPLs) in Namibia, a country renowned for its rich uranium reserves. Namibia ranks third globally in uranium production, and its strategic importance in the green energy transition cannot be overstated.
The Namibian EPLs, covering 9,627.84 hectares in the Erongo Region, include areas with promising geological formations for both primary and secondary uranium deposits. The proximity to major uranium mines like Husab and Rossing adds to the potential value of these licenses.
CEO Kal Malhi underscored the strategic benefits of the spin-out: “With the increasing shift to clean energy and concerns around energy security and climate change, we believe uranium can play a large role in the transition to zero-emission base-load electricity generation that the world requires.”
The global uranium market has seen a surge, with prices up over 52% year to date. This rise is driven by the growing recognition of nuclear energy as a clean, reliable, and cost-effective power source. As the world seeks to reduce carbon emissions and ensure energy security, uranium’s role in the energy mix is becoming increasingly vital.
Hertz Energy is in advanced stages of restructuring the ownership of its uranium assets and expects to finalize the terms of the transaction in the coming months. The proposed spin-out transaction involves transferring the Cominco Property and the Namibian EPLs into Hertz Uranium, with common shares distributed to Hertz Energy shareholders on a pro-rata basis.
Hertz Energy last traded at $0.11 on the CSE.
FULL DISCLOSURE: Hertz Energy is a client of Canacom Group, the parent company of The Deep Dive. Canacom Group is currently long the equity of Hertz Energy. The author has been compensated to cover Hertz Energy on The Deep Dive, with The Deep Dive having full editorial control. Not a recommendation to buy or sell. We may buy or sell securities in the company at any time. Always do additional research and consult a professional before purchasing a security.
