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The business of Dejour Enterprises is Energy. It has focused its exploration efforts on
the Athabasca Basin, the number one place on the planet to find uranium.
Energy
Uranium Exploration
(DJE-TSX.V)
Dejour Enterprises Ltd.
Suite1100, 808 West Hastings Street
Vancouver, BC Canada V6C 2X4
Phone: 604-638-5055
Robert L. Hodgkinson,
Chairman and CEO
Lynn Fosse, Senior Editor
CEOCFOinterviews.com
June 30, 2005
BIO:
Robert L. Hodgkinson, Chairman & CEO
30 years relevant experience in public and venture capital markets
Previous founder of several successful petroleum
exploration companies including: Optima Energy (Petroquest Energy) and Equatorial Energy
Inc. (Resolute Energy)
Company Profile:
Dejour is a Canadian oil, gas and uranium exploration and development company.
Dejour's strategy is to provide superior shareholder benefits that exist
within the wide-ranging energy markets in the Americas. The Company seeks to advance new
ideas, technology and science, which reveal geological history outside of conventional low
return energy opportunities.
Management also recognizes that only a drill bit can
turn favorable geological formations into a bankable asset. Dejour chose it's officers,
directors, board of advisors and management team based on their established track record
in industry and/or financing experience.
CEOCFO: Mr. Hodgkinson,
what was your vision when you started with the company and how has that developed?
Mr. Hodgkinson: “My vision and views on ‘peak oil’
are very current. I think to be properly positioned in the energy game today, Uranium is
probably the place to be. We had an opportunity with certain talented parties available to
us to access key exploration ground in the number one Uranium base on the planet, which is
the Saskatchewan Athabasca Basin. We set about accumulating over 800,000 acres of
high-potential Uranium properties. We are now undergoing extensive operation on each of
these.”
CEOCFO: Why uranium?
Mr. Hodgkinson: “I believe we are taxing the global
supplies of energy, particularly traditional oil and gas. The prices are getting very high
and uranium is ‘the’ alternative. The number of uranium reactors being built
worldwide is increasing significantly; it seems to be the major energy source of the
future. The price of uranium (U-235) is now beginning to show the results of that research
and demand.”
CEOCFO: Why was there so
much land available in the Saskatchewan Athabasca Basin?
Mr. Hodgkinson: “The Athabasca Basin, which is located
in Saskatchewan, has been the subject of two major resource booms in the past in the
1958-1965 range in 1975 to 1985 era. Subsequent to that, we had Three Mile Island and
Chernoble, and the price of U-235 dropped to about 7 or $8.00 a pound. Most of the land
that was under lease to the major oil companies in the last boom became dormant as a
result. Only a few companies held on to some of their properties and in the mean time,
they put two major mines into production. The Athabasca Basin is singularly the largest
mineral camp at least in North America, by production historically. All of a sudden now,
the price of Uranium is taking off again; it has gone from $8.00 to $29.00 a pound and the
boom is on again.”
CEOCFO: What are you
doing with all of this land?
Mr. Hodgkinson: “The first thing we are doing is
shooting about 7,500 kilometers of very advanced aerial survey. This will isolate the
graphitic conductors, which are the key to finding uranium that looks like shoestrings at
the bottom of the sandstone basin. That project will cost us about $2 million dollars. It
probably will be completed by the end of June, and interpreted by the end of August. At
that point, in time, we will isolate the dozen or so major hotspots that we choose to
focus on. I will bring in a joint venture or a strategic partner and beginning in the
fall, we begin to do the necessary groundwork to drill these properties as soon as
possible.”
CEOCFO: What is the
timetable for that?
Mr. Hodgkinson: “The timetable depends on funding.
Dejour is a small company with 25 million shares outstanding and market cap of about $12
million, with over $6 million in cash. We are in good financial shape at this time. The
exploration for uranium in the basin can take many hundreds of millions of dollars where
encouraging results happen. Timing is everything. I believe we are in the early stages of
a boom and I think there would be a lot of opportunity to raise capital, take on strategic
financial partners and accelerate the exploration and exploitation of these properties
accordingly. I expect to be drilling some of these properties beginning in December
through next March. With any encouraging result there, I would expect to be active next
fall on each of these projects while we are doing exploratory drilling on some of the
other properties.”
CEOCFO: Is it correct
that this will be going on for some time?
Mr. Hodgkinson: “Yes it is. This is a five-year program.”
CEOCFO: Are there
concerns when looking for uranium that might be different from looking for oil and gas?
Mr. Hodgkinson: “I think it is opposite. Northern
Saskatchewan is a uranium-mining region. Everything about that part of the country is
about finding additional reserves; the economic base of that part of the country is
Uranium. Unlike oil and gas where you have sour gas and the possibility of explosion, you
do not have that here. We are dealing with a radioactive mineral; in fact, most of the
producing mines are underground robotic mines in this particular region. It is a very
expensive proposition to develop, but once it is developed, it is extremely profitable.”
CEOCFO: What are the
newer technologies that you are able to take advantage of that were not available in the
last boom cycles?
Mr. Hodgkinson: “The airborne mega-tem surveys that we
are shooting here, have only been available to the mining community since 2002. In the
last mining boom in 1975-1985, these kind of powerful magnetic surveys were not possible.
The key to these magnetic surveys is differentiating the basement magnetics from the
meta-sediments, which are of interest to us. The ability to see these pictures and get a
read of exactly where the graphitic conductors lay is key to this exploration process. The
Athabasca Basin is just like a big soup bowl; it was formed 1.6 billion years ago in
sandstone. The uranium has percolated in solution to the bottom of the basin where it
interfaces with graphitic conductors and forms shoestring-like deposits. These are very
difficult to find. The more powerful the technology and equipment the better the
opportunity that we have."
CEOCFO: Will you tell us
about the expertise of the management team?
Mr. Hodgkinson: “I am chairman and CEO and I have been
involved in public markets for 30 years. Doug Cannaday is our president and COO. Doug has
been an operator is the oil patch and has run several public companies and attracted
hundreds of millions of dollars in capital to his projects. The key to the uranium
exploration is Dr. Lloyd Clark who was the head geologist at SMDC Saskatchewan Mining
Development Corporation, which is now Cameco Corporation (TSX: CCO). He was the head of a
team of 65 geologists who made the discovery of the McArthur River mine, which today is
the world’s richest and largest producing uranium mine, and accounts for roughly 30%
of the global production. Under him, running our exploration is Allen McNutt, who has over
thirty years in the Basin and also working with Cameco. We have three other geologists
under him based in Saskatchewan focused on our properties, who between them have over
sixty years in that basin. It is a seasoned group of successful explorationists.”
CEOCFO: When do you need
to look for more funding?
Mr. Hodgkinson: “Success requires additional capital and
that is a good thing. I would think that by the end of July and the first part of August
that we will have a definite picture of the possibilities for extending our exploration.
At that point, we are going to make decisions about attracting joint venture partners or
strategic investment partners. In the venture business the best time to raise money is
when you don’t need it. We realize that premise.”
CEOCFO: Why should
potential investors be interested the company and what should they know that perhaps they
do not realize when they first look at the company?
Mr. Hodgkinson: “Dejour is the fifth largest landholder
in the Athabasca basin. These properties have been hand picked by Dr. Lloyd Clark. They
have been the result of well over forty years experience in this particular geological
setting, with imminent success here. These properties are chosen following particular
theories of geological development that had been utilized by Dr. Clark. Some of those are
currently used by Cameco in focusing on their basin activities in areas previously not
been prone to heavy exploration, which is where Dejour is focusing. We have an individual
concept there and we are going after that. We have been using capital given to us to
advance this exploration effort as fast as possible. The Athabasca Basin is the largest
dollar value mineral-producing environment in North America. As a result, although the pot
of gold is at the end of the rainbow it is difficult to find, when found it is very
substantial. The rewards for shareholders are extremely high.”
CEOCFO: Final comments
for our readers?
Mr. Hodgkinson: “I think that if we had been reading
every deal about peak oil, the price of oil and gas is going to one hundred bucks, or oil
going to one hundred bucks, we also know that over the next eight years the ability of
North America to supply natural gas for its own needs will have ended. There are over
fourteen LNG plants planned for the coastal ports of North America to import gas for
domestic needs, not for export as most of us seem to think. This is shocking. The demands
for energy here are going sharply higher, so I think the price of uranium is going sharply
higher. I think we are in the early stages of an extended uranium boom, which is going to
be creating a hugely speculative environment in the exploration field. If you are going to
explore for uranium, the number-one place on the planet to find it is in the Athabasca
region.”
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