Jay Currie’s Motherlode: Fission Uranium & Red Light Holland
Fission Uranium Corp.
I am convinced the nuclear industry will thrive in the next decade. All those electric vehicles are going to need a lot of electricity and, frankly, wind and solar are not going to cut it. Which leaves nuclear energy – big or small, nuclear reactors are the only “green” source of electrical generation which can possibly meet surging demand.
Reactors require fuel which, for the foreseeable future, means uranium. The good news is that the Athabasca Basin in Saskatchewan is full of the stuff. The investment challenge I set myself was to find a company with a real property, real prospects and a deposit which was near surface. There are several juniors which fit the bill but Fission Uranium Corp. (TSX: FCU | OTCQX: FCUUF) has completed a pre-feasibility study of its Triple R deposit.
This is a uranium deposit where the high grade material starts just 50 meters below surface. At present, Fission counts 102,360,000 pounds of uranium as indicated and another 32,810,000 pounds inferred. It will be doing more drilling to add pounds to that resource.
Fission is doing the heavy lifting of defining a resource and doing the pre-feasibility and feasibility studies required for that resource to be sold or joint ventured. The CAPEX is north of a billion dollars which makes it unlikely a $368 million market cap company will develop a mine on its own.
If my thesis that uranium is going to be in high demand in the next decade is correct, companies like Fission are going to be attractive to larger uranium companies and to general mining companies looking for a window into the uranium market. A company with a significant uranium resource, a completed pre-feasibility study working towards feasibility is going to be an increasingly attractive target.
Meanwhile, the entire sector on the junior side could become “hot” as investors position themselves for higher uranium demand. My own exit will not likely wait on a takeover or joint venture, but will likely be triggered by market driven share price appreciation.
Red Light Holland Corp.
While I wrote a book about cannabis, I missed out on the investment “Green Rush”. What would be the next “big thing” in the legal psychoactive substance world? The answer is psychedelics – chemical and organic but a year ago there was nowhere to invest in that space.
Enter Red Light Holland Corp. (CSE: TRIP). Under the leadership of CEO Todd Shapiro, Red Light Holland set about exploring the world of “magic truffles”, psychoactive fungi. These are psilocybin truffles which, taken in microdoses, appear to help people achieve clarity and what might be described as “mental well-being”. The problem was that when Todd began exploring magic truffles they were illegal.
Todd knew that to explore the magic truffle world he had to create a legal source of supply. There was one place in the world where magic truffles were legal: Holland. So, Todd set up Red Light Holland with the goal of growing truffles in Holland and making Red Light Holland’s custom microdoses available in the legal Dutch marketplace.
Over the last year that is exactly what Red Light Holland has done. It built a clean room growing facility in Holland and is producing magic truffles in increasing quantities. It has developed its consumer focused micro-dosing kits for sale in Holland.
Todd has learned a lot from the Canadian cannabis experience guided, in part, by Canopy Growth founder Bruce Linton who sits on Red Light Holland’s Advisory Board. By beginning in a jurisdiction where magic truffles were already legal, Red Light Holland avoided many of the regulatory tangles which plagued the cannabis business. Todd was also committed to growing magic truffles to meet market demand rather than anticipating that demand.
Red Light Holland has followed its business plan and is now poised for significant growth. In March 2021 the company announced it has acquired SR Wholesale B.V. one of the Netherlands’ premiere distributors for quality psychedelic truffles. Also in March the company also has made an arrangement with a Canadian company to import Red Light Holland micro doing kits to Canada under a Health Canada psilocybin import permit.
There are now several publicly traded psychedelics companies each with its own business strategy. What sets Red Light Holland apart is that it has a legal source of supply and a significant legal distribution network. Red Light Holland is poised to be a leading player in the psychedelics industry, the only question is how big that industry will become.
Timing the North
I have no idea how to time the general market. But I do pay attention to the ebbs and flows of the junior resource market. I follow a bunch of stocks who are exploring in Northern Canada. Kestrel, Etruscan, Aben, Golden Predator, White Gold, Triumph and Metallic Minerals to name a few.
There is a cycle and it is dictated by climate and darkness. When you go up to the north you realize that it is very cold, very snowy (tough to prospect or explore under ten feet of snow) and dark until March. If you have to use helicopters to reach your targets you cannot do much from November until late March.
All of which means that “news”, the life blood of junior explorers, is pretty much non-existant from March until, at best, July. Because an explorer cannot even see the ground until late March. It takes the season, March until October, to sample, fly, trench and drill a piece of ground. Even if you get the first cores out in early June, the COVID compliant labs will take a month or two to process assays.
April is the month where northern junior explorers announce their plans for the season. They pick their targets and deploy. Then we have the lull. The dead time when the work is being done. If you are a day trader you might as well go home. Nothing is going to happen and the shares will drift. If you are an investor the lull is the time you build a position.