Canadian junior Pistol Bay stock just went ballistic and here's why

Shares Pistol Bay Mining Inc. (TSX-V: PST) were up more than 45% on Tuesday mid-morning after the company announced that joint venture partner Rio Tinto will start drilling at its "C Blocks" uranium properties in Saskatchewan's Athabasca Basin.

The move means that the world's second largest miner is moving forward with the planned acquisition of the uranium assets, located close to Cameco's McArthur River mine - the world's largest producing uranium mine.

In 2014, the Vancouver-based junior optioned the C5 Property, along with the C4 and C6 claims to Rio Tinto, which has already earned a 75% interest in the assets. And last year, Rio announced its intention to exercise its option to increase its stake in the assets to 100% by paying Pistol Cdn$5 million by December 2019.

Source: Google Finance.

So far, the mining giant has drilled 12 holes for a total of 6,104 m on the C5 Property, and completed gravity and DC resistivity surveys.

Meanwhile, Pistol Bay will focus its efforts in advancing its Dixie zinc-copper-gold properties in Ontario, Canada, which it bought in October last year.

The acquisition, combined with the already optioned Dixie and Dixie 3 Properties, made the Canadian junior the dominant landholder in the Confederation Lake Greenstone Belt, a 7,050 hectares-area in the area southeast of Red Lake.