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Paladin Energy Ltd.’s C$1.14 billion ($833 million) offer to buy Canadian mining firm Fission Uranium Corp. is all about geography.

The all-stock deal will give Australia’s Paladin operational control of one of the most advanced mining projects in western Canada’s Athabasca Basin, a remote area in Saskatchewan that’s loaded with high-grade uranium. Fission’s asset is expected to open in 2029 and produce an annual average of 9.1 million pounds of the metal over a decade.

“The rationale is very compelling,” Paladin chief executive officer Ian Purdy said in a Monday interview. “We see this as a fantastic asset.”

Fission is one of several junior mining firms racing to develop projects in the Athabasca region, along with NexGen Energy Ltd. and Denison Mines Corp. The region has become a hub of mining activity as supply concerns escalate and while countries warm to nuclear power as part of a global push to move away from fossil fuels.

Fission CEO Ross McElroy said that while the region holds high concentrations of uranium, few companies have the expertise to find and develop such projects.

“Having worked the majority of my geology career in the Athabasca Basin, I can tell you that it takes a great deal of expertise to properly explore and make discoveries like this one,” he said in an interview.

Paladin’s CEO said he expects more uranium dealmaking on the horizon. The price of the radioactive metal has more than tripled during the past five years, accelerating after Russia’s invasion of Ukraine sparked a newfound need for alternative sources of the reactor fuel.

“Regardless of where the uranium cycle is or how the industry’s doing, the combination of these two companies just makes fundamental sense,” Purdy said.

(By Jacob Lorinc)