Strathmore teams with Sumitomo in New Mexico

Strathmore Minerals (STM-V, STHJF-O) will form a joint venture with Tokyo-based Sumitomo to develop its Roca Honda project, in New Mexico.

Sumitomo is paying Kelowna, B.C.-based Strathmore US$1 million to enter into the joint venture.

In a release, Strathmore said the purpose of the joint venture is to complete a feasibility study. Sumitomo will contribute 40% of the cost of the study.

If the companies decide the mine is a go, Sumitomo will fund more than US$50 million in development costs at Roca Honda and will market the U3O8 produced from the mine.

The deal also gives Sumitomo the right to enter into joint ventures on any new projects that Strathmore may acquire in New Mexico.

Further details of the agreement were withheld for “competitive reasons.”

“The combination of an internationally recognized credible financial partner and our strong technical team provides the resources necessary to advance the Roca Honda project to production,” said Strathmore’s chairman and chief executive Dev Randhawa in a statement. “We look forward to Sumitomo’s ongoing contribution and partnership.”

Sumitomo’s business includes the importing and exporting of a wide range of goods and commodities. The company also provides a wide range of services.

Sumitomo is invested in metals, transportation and construction systems, machinery and electricity, media, electronics and network, chemicals, mineral resources and energy, consumer goods and services, materials and real estate, and finance and logistics.

Roca Honda is situated on the Grants Mineral Belt, which has produced more than 300 million lbs. of uranium, and was the largest uranium district in the world during the last uranium cycle which ended in the mid-1970s.

The Roca Honda deposit has a measured and indicated resource of 17.5 million lbs. grading 0.23% U3O8 and an additional inferred resource of 15.8 million lbs. grading 0.17% U3O8.