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Shaw and Partners Uranium Conference: Key Takeaways

Shaw and Partners hosted its 5th Uranium Conference on 26 March 2024. Presenters included: TradeTech, Sprott Physical Uranium Trust, WMC Energy, NexGen Energy, Peninsula Energy, Paladin Energy, Alligator Energy, Lotus Resources, Bannerman, Silex and Toro Energy.

The key takeaways from the event were highlighted by Head of Research, Andrew Hines and outlined for Market Matters Subscribers:

We remain bullish on the sector and expect to see the uranium price continue to strengthen through 2024 and 2025. We recently upgraded our price forecast to US$150/lb by the end of 2025.

Uranium Sector – Nuclear Summer – Upgrading Uranium to US$150/lb – 22 Jan 2024

Our key takeaways from each presentation are below. The presentations were recorded and will be available shortly.

TradeTech, an independent provider of uranium pricing and nuclear fuel market information

  • See long-term uranium pricing trending upwards as a result of looming supply deficits, lengthy development timeframes, growing policy support and geopolitical uncertainties.
  • US sanctions progress, aimed at curtailing Russian nuclear fuel imports into the US. Dec’23 Senate vote was blocked by Ted Cruz. Recent Foreign Affairs committees have met to discuss further progress.
  • Buyer preference for non-CIS sources has already moved the market.
  • Recent deliveries of Russian nuclear fuel has been held up by the presence of plywood on ships – plywood is on the sanctions list.
  • The spot price at US$107/lb resulted in selling from unconventional buyers and a subsequent spot price retracement.
  • Forecast demand to grow to 250mlb annually by 2040 from 180mlb today, driven by US, Europe, China, Japan and South Korea.
  • The global market is short 40mlb today. This will grow to 65mlb by 2036 with only modest demand growth.
  • The term market exhibited its second busiest year since 2001 in 2023 with 163mlbs sold, the highest since 200mlbs in 2012.
  • Contracts already comprise material yet to be produced. This has shifted market power firmly back to the Sellers.
  • Just watch out for innovation such that supply ultimately equals demand, or intervention, eg governments force physical trusts to release inventories onto the market.

Sprott Physical Uranium Trust (NR)

  • The world’s largest physical uranium trust. Listed on the TSX. Trading at a slight discount to NAV.
  • US$8bn in assets, 63.6mlb uranium, enough to power France for three years.
  • Identified a structural supply deficit when launched 3yrs ago that does not appear solvable in the medium-term.
  • COP28 recognising nuclear as one of the solutions to climate change represented a fundamental shift in energy policy, the greatest show of support for nuclear power in 70yrs.
  • AI and data centre growth to drive power demand, particularly baseload power, as the world transitions to intermittent.
  • 2023 was the long-awaited inflexion point in the contracting cycle with 160mlbs contracted, 60mlb by Ukraine. Still early in that cycle.
  • Half of global production occurs in Kazakhstan each year, all shipped through Russia.
  • Current spot price US$88/lb still low vs 1970s nominal price US$170/lb and US$200/lb in 2007 so further room to move.


Provides long-term supply, marketing, offtake, financing packages for the nuclear fuel industry.

  • WMC was appointed technical advisor to the Sprott Physical Uranium Trust in 2021.
  • Utilities stepped away from the spot market when prices hit US$100/lb and significantly increased term activities.
  • Cameco and other large producers are largely sold out between 2025-26. US$85/lb likely the price floor as the carry trade is economic at that level.
  • Kazatomprom production challenges to stretch to 2025, will provide production guidance in Aug’24.
  • The spot market is thin such that volumes 500kt-1mlb will move the market.
  • It would take two weeks to buy that amount of uranium.

NexGen Energy (ASX: NXG, Buy, $17.50)

NexGen Energy – Developing the World’s Best Uranium Mine – Initiation of Coverage – 03 Mar 2024

  • Canadian dual-listed developer of the Rook 1 uranium mine in Saskatchewan’s southwestern Athabasca Basin.
  • Rook 1 is the largest single-source deposit of high grade low cost uranium in the world.
  • Measured & Indicated resource of 256mt at 3.1%. Over 60% of the M&I grades at 17%.
  • Unlike Cigar Lake, the deposit is entirely contained in basement rock with no surface water, making it suitable for conventional bulk mining methods.
  • 2021 Feasibility Study outlines an initial 11-year life producing 29mlbs at AISC US$10/lb for US$1.3bn capex (11mth payback) making it the lowest cost uranium mine in the world.
  • Offtakes to be structured as volume-based, tied to spot prices with no floor or ceiling.
  • Project envisages underground tailings storage.
  • Have received sign off by local community and indigenous groups. Still waiting on a Federal approval hearing date

Peninsula Energy (ASX: PEN, Buy, $0.34)

Peninsula Energy – Is this the cheapest ASX uranium stock? Trading at 1/10th the EV of Boss Energy – 31 Jan 2024

  • PEN is re-starting the Lance In-Situ Recovery Project in Wyoming.
  • A revised production plan incorporates a fully integrated processing plant following UEC’s termination of the prior resin processing contract in Jul’23.
  • The revised processing plan includes Dec’24 first production ramping up to 1.8mlb steady state by 2029. C1 US$21.69/lb and AISC US$42.46/lb.
  • Additional funding required to support the ramp up to positive free cash flow, around 9mths post first production.
  • Progressing discussions with debt providers, including the US Department of Energy.
  • Lance will be the first US project to use low pH in-situ recoveries, placing project costs in the lowest quartile of producers globally.

Paladin Energy (ASX: PDN, Buy, $1.50)

Paladin Energy – Commissioning of the Langer Heinrich restart has commenced – 25 Jan 2024

  • PDN is re-starting the Langer Heinrich mine in Namibia. The company has all permits and licenses in place and construction is 95% complete.
  • The operations team is in place. Currently hot commissioning the drying and packing plant.
  • First production end of March or early April, with first (early) sales to a customer in June.
  • Forecasting 4mlbs production in FY25, nameplate 6mlbs in FY26.
  • Will provide a full corporate update and production guidance in Jul’24.
  • US$61m cash at the end of Dec’23 and US$150m debt facility to support the ramp up period.
  • Future growth from Langer Heinrich orebody extensions and mine optimisation, Michelin project pathway.

Alligator Energy (ASX: AGE) (NR)

  • Alligator are progressing an In-Situ operation at Samphire in South Australia.
  • Current resource 18.1mlbs. Scoping Study envisages a 12yr operation for $129m capex, AISC US$30/lb.
  • An update in Dec’23 incorporating a lift in the annualised in-situ recovery target from 1mlbs pa to 1.2mlbs pa, and an increased price assumption to US$75/lb.
  • Drilling ongoing to support further resource estimates. $36.6m cash at Dec’23.
  • Potential for a close to carbon-free project as no crushing of rock required, close enough to Whyalla for electric vehicles.

Lotus Resources (ASX: LOT, Buy, $0.72)

Lotus Resources Ltd – Kayelekera FID expected in 2Q24 – 31 Jan 2024

  • LOT is intending to re-start the fully permitted Kayelekera project in Malawi.
  • Lotus acquired the Letlhakane Project in Botswana from A-cap Resources in 2023.
  • Letlhakane resource 190mlb, located close to road, rail, power. The combined Kayelekera/ Letlhakane 241mlb resource is the third largest on the ASX.
  • Key outcomes from 2022 Kayelekera DFS include 10yr life of mine producing 2.4mlbpa at AISC US$38/lb for initial capex US$88m.
  • Lotus is planning to make significant improvements to Kayelekera including ore sorting, connection to the national grid, and a new acid plant to improve recovery.
  • Mine development currently being negotiated, offtake enquiries from US and European utilities.
  • Also studies to connect to national grid, preliminary financing discussions, early site works prior to FEED.

Bannerman (ASX: BMN, Buy, $7.04)

  • BMN is progressing the Etango Uranium Project in Namibia.
  • Etango is large: measured and indicated resource is 150mlb with a 60mlb reserve.
  • Etango-8 comprises a 15-year open pit heap leach operation with 8mlbpa throughput for 3.5mlb annual production.
  • Recent scoping study also examined an extension project (mine and throughput expanded to 16mtpa from year 5) and a life extension (27yr life with mine and plant throughput maintained at 8mtpa).
  • Key features from the Dec’22 DFS: pre-production capex US$317m and AISC US$38/lb for a 4.1yr payback period at US$65/lb.
  • Present an upside case to US$80/lb from US$65/lb base: net cashflow +69% and payback period reduced by 29%.

Silex Systems (ASX: SLX, Buy, $7.60)

Silex Systems – Accelerating Laser Uranium Enrichment – 19 Feb 2024

  • SLX is focussed on the development and commercialisation of the SILEX laser isotope separation technology.
  • The primary commercial application of the technology is the production of different grades of fuel for the nuclear power industry, licensed to Global Laser Enrichment, GLE 49% Cameco, 51% Silex.
  • Nuclear fuel supply chains are down to only 3 conversion services and 2 enrichment services outside Russia.
  • SLX pilot demonstration program remains on-track for mid-CY24, with commercial operations as early as 2028.
  • GLE path to market through the Paducah Laser Enrichment Facility in Kentucky. GLE has three separate programs to produce uranium.
  • The 2024 budget will allow for site acquisition actives at Paducah and completion of the Test Loop pilot facility in Wilmington, NC.

Toro Energy (ASX: TOE) (NR)

  • Toro is progressing the Wiluna Uranium Project in WA.
  • Wiluna has received federal and state government environmental approvals for mining uranium at the Centipede, Lake Way, Millipede and Lake Maitland deposits.
  • 62mlb Measured & Indicated Resources. Three Japanese utilities and Itochu own an option to acquire 35% of Lake Maitland for US$39m.
  • The production plan envisages a 1.5mt plant producing 1-2mlbpa uranium for 10-20yrs.
  • A refresh and update of the Lake Maitland Scoping Study is currently underway.
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