LSE- and A2X-listed Neo Energy Metals’ South African subsidiary Neo Uranium Resources South Africa (Nursa) has entered into a binding heads of agreement to acquire a 100% interest in the Henkries South uranium project from South African uranium exploration company Eagle Uranium.

The Henkries South project comprises one granted prospecting licence that extends over about 1 050 km² and is immediately south of, and adjoins, the company's existing Henkries uranium project located in the administrative district of Namaqualand in the Northern Cape.

This acquisition will expand Neo Energy's strategic landholding in the region by more than 130%, increasing from 742 km² to almost 1 800 km².

Additionally, it adds a further 10 km of strike length to the company’s current 36 km of shallow paleo-channels, known to host uranium mineralisation based on multiple resource drilling programmes and feasibility studies conducted over a period that resulted in $30-million being invested in exploration and development.

Previous exploration, combined with the company's technical management team’s investigations, has indicated that Henkries South contains several radioactive anomalies. Given the radiometric anomalies observed, the targets are expected to significantly contribute to the resource potential at the Henkries project.

Further, the shallow uranium mineralisation identified at Henkries is believed to have been transported from the uraniferous granites in Springbok by way of Henkries South.

Uranium mineralisation in the southern part of the Henkries project is shallow, at depths of up to 6 m, and demonstrates good continuity with average grades of between 300 ppm and 400 ppm triuranium octoxide, pointing to significant new uranium discovery potential.

This acquisition supports Neo Energy’s commitment to advancing the Henkries project toward production, offering an opportunity for a potentially larger-scale mining operation delivering low-cost uranium in the near future.

The acquisition follows the release of a technical report on the Henkries project by Erudite Strategies in June, indicating a low-cost opportunity with robust economics.

The company will now further consolidate its position in the Northern Cape’s emerging uranium sector.

This is Neo Energy’s second strategic acquisition, following the recent formalisation of an agreement to acquire the Beisa North and Beisa South uranium and gold projects in the Witwatersrand basin. These acquisitions are aligned with the company’s strategy to become South Africa’s leading uranium miner and one of Africa's major operators.

Under the terms of the agreement with Eagle Uranium, Neo Energy will issue 25-million shares to Eagle Uranium and repay R600 000 of inter-company debt.

Upon completion of formal documentation and regulatory approval, a further 175-million shares will be issued, and an additional R1.7-million debt repayment will be made.

Deferred equity payments of up to 250-million shares will be issued, based on Joint Ore Reserves Committee-compliant resources of uranium.

"We recognised the strategic potential of this opportunity well before our listing on the LSE last year and we are, therefore, pleased to have now finalised this acquisition.

“From a technical and geological perspective, this acquisition is particularly significant owing to its location within the uranium migration pathway. This expansion more than doubles our strategic landholdings in the pivotal Northern Cape region," Neo Energy CEO Sean Heathcote said.

Application has been made for the newly issued shares to be admitted for trading on the LSE on October 14. The company’s issued share capital will comprise about 1.49-million ordinary shares.