Published: March 1, 2024 |

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Backed by the strength of the uranium market, Peninsula Energy Ltd. has signed a new sales agreement to supply uranium yellowcake from its Lance Project in Wyoming, to European nuclear fuel buyer Synatom.

The agreement requires that the company — through its wholly owned subsidiary Strata Energy — sell 1.2 million pounds of uranium to Synatom over a six year period starting in 2028.

The contract is expected to generate gross revenue of US$88 million to US$117 million (A$135-A$180 million) over the term, with healthy margins expected as pricing is projected to be “well above” forecast production costs at Lance.

“The strength of the uranium market dynamics in recent months has allowed Peninsula to consider adding sales commitments with improved pricing structures to our sales portfolio,” said Peninsula Managing Director and CEO Wayne Heili.

“This new long-term agreement adds financial security to our uranium production facilities while capitalizing on the current robust price environment. We are pleased to be establishing this relationship with another significant utility customer,” added Heili.

The pricing structure is a blended approach that includes both base price and market priced components, with the resulting pricing projected to be “well above” the forecast production costs at Lance as reported in the August 2023 life-of-mine model.

With this new sales agreement, the company’s total contractual sales obligation over the coming ten years is now 6-million pounds. In the life-of-mine model, Peninsula projected production of around 14.8 million pounds of uranium during that time.

Peninsula notes that the agreement with Synatom is subject to concurrence by the European Supply Agency (Euratom).

Source: Proactive Investors

Peninsula Energy Limited is an uranium mining company with its 100 percent owned Lance Project in Wyoming one of the largest near-term uranium development projects in the United States. Currently undergoing a project transformation initiative, the long-life Lance Project is transitioning to a low cost and environmentally friendly low pH ISR operation. Once back in production, Lance will establish Peninsula as a fully independent end-to-end producer of yellowcake. Lance is well-placed to become a key supplier of uranium and play an important role in creating a clean energy future.

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