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Saturday, Dec 2, 2023
Mugglehead Magazine
Alternative investment news based in Vancouver, B.C.


Peninsula Energy raises $54M to restart top American yellowcake uranium operation

Once production resumes by the end of next year, Lance will become the largest producer of U3O8 in the U.S.

Peninsula Energy raises $54M to restart top American yellowcake uranium mine
Facilities at the Lance uranium mining operation, Wyoming, U.S. Photo via Peninsula Energy

Australia’s Peninsula Energy Limited (ASX: PEN) (OTCQB: PENMF) raised $54 million to restart production at its flagship uranium operation in Wyoming.

The company said on Monday that once fully operational by the end of next year the Lance project will be the largest producer of yellowcake (U3O8) in the United States. The funding will enable Peninsula to start preliminary construction work needed for the project prior to commercial production. It will be provided by government agencies, international banks and others through private placements.

Yellowcake is a refined form of uranium produced through a chemical and milling process that removes impurities from the raw mined ore. The yellowish powder can be further refined into uranium hexafluoride (UF6) for use in nuclear fuel. Uranium is generally shipped in the form of yellowcake within barrels.

The production facilities at the project were previously operational between 2016 and mid-2019. Once production resumes next year at full-scale, the site is expected to produce 1.8 million pounds of U3O8 per year with a 10-year mine life.

“Importantly, the critical role of uranium and nuclear energy continues to gain rapid momentum across the globe, due to the significant benefits as a 24/7, clean energy source,” said Peninsula’s CEO Wayne Heili.

The Lance project is comprised of the Ross and Kendrick production areas and the Barber exploration and development area. Ross has a fully licensed in situ recovery (ISR) production facility with a 6 million pound U3O8 resource and Kendrick has a 15.9 million pound uranium reserve.

“Lance will come online at an opportune time and be well-positioned to deliver into a growing, supply-constrained market,” added Heili. The operation is expected to generate US$988 million in revenue during its lifespan.

The Barber exploration area contains an estimated 31.9 million pounds of U3O8, which the company says is predominantly inferred.

Conceptual model of an in situ leach/recovery process. Image by Peninsula Energy via the World Nuclear Association

Read more: ATHA Energy defines 18 high-priority prospective mining targets after EM survey

Read more: ATHA Energy aerial surveys over Athabasca Basin reveal strong potential for uranium

Rising demand for uranium prompts accelerated development in North America

The rising demand for carbon-free energy sources needed to meet the climate goals of various nations has inspired a resurgence in uranium production.

Peninsula says there has been a growing global recognition of the important role nuclear power will play in meeting decarbonization targets. The company also says the U.S. government has been working to increase the country’s domestic uranium production capacity to improve the nation’s energy security.

Centrus Energy Corp (NYSE American: LEU) just shipped the first American high-assay low-enriched uranium produced in the last seven decades to the U.S. Department of Energy. The company aims to increase the production capacity of its unique uranium enrichment facility in Ohio by 650 per cent in the coming years to meet demands.

In Canada, the leading uranium company NexGen Energy Ltd. (TSX: NXE) (NYSE: NXE) just received the first comprehensive environmental authorization for a Saskatchewan uranium project in the last two decades from the government. The province’s Premier Scott Moe congratulated the company on the achievement.

Other companies like ATHA Energy Corp. (CSE: SASK) (FRA: X5U) (OTCQB: SASKF) have been establishing a foothold in Saskatchewan’s section of the Athabasca Basin, one of the world’s best uranium mining regions. ATHA completed the largest electromagnetic survey in the jurisdiction’s history earlier this year and identified a series of high-priority mining targets to drill in 2024.

Canadian uranium exports to the European Union increased by 50 per cent last year. The spot price of the metal has increased immensely in recent days.

Chart via Peninsula Energy


ATHA Energy is a sponsor of Mugglehead news coverage


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