QAMANITTUAQ/BAKER LAKE
Potential Northern synergies between mineral projects in Nunavut means Canadian exploration company Forum Uranium Corp. (TSX.V:FDC) is keeping its North Thelon uranium project active and ready for future investment.

Forum Minerals Inc.'s Boen Tan, Ken Wheatley and president Rick Mazur log rock samples on the North Thelon uranium project west of Baker Lake. - photo courtesy Forum Uranium Inc.

Located less than 100 km west of Baker Lake, the North Thelon property covers approximately 197,300 hectares of land, some of it contiguous with French mining giant Areva's Kiggavik uranium properties.

Forum Uranium has been active in the area since acquiring the property in 2006. Positive drilling results in 2009 and 2011 set the stage for a summer drill program that would have seen a camp established at Sissons Lake and a further 3,000 metres of drilled targets.

But the collapse of the uranium market, following the 2011 Fukushima disaster in Japan involving the meltdown of three of six nuclear reactors in one plant, put a halt to those plans.

Concern surrounding the safety of nuclear energy after the disaster led to the shutdown of Japan's 48 nuclear reactors, which accounted for more than ten per cent of the world's active nuclear reactors. This diminished the demand for uranium fuel; a recovery in the uranium market is still to come.

"The issue with uranium right now is that the price has reached a nine-year low," said Forum Uranium president and CEO Rick Mazur.

"That's predominately due to the slow restart of the Japanese nuclear industry. Basically, the whole industry shut down."

Forum Uranium took a tumble as well. At the start of 2011, Forum Uranium was listed at $6.30 per share on the TSX. Last week it closed at $0.18 per share.

But the Japanese industry is showing signs of restarting with Reuters reporting a pro nuclear-energy government eager to see the country's 48 reactors come back online once they pass safety checks.

Of even more significance, the International Atomic Energy Agency reports that 72 new reactors are under construction, primarily in Asia.

Current world production of uranium, according to statistics from World Nuclear Association, is 58.4 thousand tonnes annually.

Total demand from existing reactors plus reactors expected to be operational within the next 15 years is pegged at 65.9 thousand tonnes.

Although nuclear plant retirements offset some of the new plants coming online, the balance is projected to tilt in favour of more demand over the long-term, with 272 new plants in production by 2030 compared to only 71 decommissioned.

Some analysts see this situation as pointing to short-term headaches for uranium prospects, but a long-term rise in prices and investment in exploration.

Mazur agrees with those who are bullish on uranium's future.

"I think once the Japanese fleet gets back online, that's going to change the sentiment," said Mazur.

"China is still going through a huge nuclear build. We don't see that slowing down at all. That's going to create huge demand down the road."

Some investors, in turn, agree with Mazur.

Forum Uranium was able to raise just over $3 million through a private placement this March. Most of that money was earmarked for Forum Uranium's Athabasca Basin project in northern Saskatchewan.

Three million dollars goes further in Saskatchewan than it does in Nunavut, so that is where the company is focusing on.

But Forum Uranium did complete a small prospecting program this season to keep its North Thelon properties active and in good standing, including a recent application to renew its water-use permit with the Nunavut Water Board.

"We're holding tight," said Mazur. "We'll watch Areva's progress with the submission of their final environmental impact study, and we look forward to Areva receiving a production certificate from the NIRB (Nunavut Impact Review Board) next year."

French uranium mining and nuclear energy giant Areva anticipates a $2.1 billion dollar project adjacent to Forum Uranium's properties. Having spent more than $100 million on the project already, Areva is expected to submit its final environmental impact statement to the Nunavut Impact Review Board (NIRB) before the end of this year.

Assuming NIRB approval and a positive economic feasibility analysis, mine construction could start as early as 2018.

"That should be an important catalyst," Mazur said. "We'll just see how that all unfolds."

"Our view is to basically maintain our property position in good standing over the next few years."

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