The Deep Yellow Limited (ASX: DYL) share price is rallying strongly on Tuesday, up 5.5% to $1.15.
In comparison, the All Ordinaries Index (ASX: XAO) is up 0.3% at the time of writing.
What's driving the Deep Yellow share price?
Phase 1 follow-up drill program complete
Deep Yellow announced it had successfully completed its phase 1 follow-up drilling at the Barking Gecko prospect within its Nova joint venture project in Namibia.
The phase 1 drilling results returned encouraging results, with 13 of the 14 holes intersecting uranium mineralisation.
Deep Yellow was pleased with the exceptional thickness and grade of some of the intersections, and that all holes within the zone were mineralised.
A phase 2 drilling program to undertake further follow-up is planned to begin, at the latest, early calendar year 2022. This will happen once all results from the current drilling are fully evaluated.
Overall, the initial results remain encouraging, with Deep Yellow citing the "prospective nature of this zone being confirmed".
A bumper day for ASX uranium shares
The surging Deep Yellow share price joins the broad-based rally taking place among uranium shares on Tuesday.
This comes after the world's largest uranium producer, Kazatomprom, announced plans to launch its own physical uranium fund.
Similar to Sprott Asset Management and its Physical Uranium Trust, this fund will hold physical uranium as a long-term investment.
In the case of Sprott, its uranium fund has accumulated more than 30 million pounds of uranium since its inception on 19 July 2021.
During this time, uranium spot prices surged from the low US$30/lb level to a 9-year high of approximately US$50/lb on 17 September.
Kazatomprom will raise an initial US$50 million, financed by its founders. It will then raise US$500 million from institutional and/or private investors to fund its uranium purchases.
Uranium-related shares performed strongly overnight, with the Global X Uranium Exchange Traded Fund (ETF) rallying 4.72%.
