Peninsula Energy Ltd Raises AU $ 15 Million for Uranium Purchase to Support Lance Project Transition

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The placement and the SPP will finance the purchase of 300,000 pounds of uranium at a price of US $ 31.35 per pound, a strategic purchase that will help the company transition from the Lance project in Wyoming to an ISR operation in low pH.

() () (FRA: P1M) received commitments from institutional and high net worth investors for A $ 13.4 million via a stock placement at 15 cents per share.

A Share Purchase Plan (SPP) will be offered to eligible shareholders to raise up to a maximum of AU $ 2 million at the same share price as the placement.

The net proceeds will be used to pay for the purchase of 300,000 pounds of natural uranium (U3O8) concentrates at a price of US $ 31.35 per pound, which reflects the prevailing spot uranium price.

Settlement is due in June 2021 and the uranium will be stored at Cameco’s facility in Ontario, Canada.

“Physical uranium offers an advantage”

The Peninsula Board of Directors believes that the acquisition of physical uranium is strategically aligned with the preparations for the company’s flagship Lance project to transition to low pH ISR operations.

The inventory of uranium acquired may ultimately constitute a source of financing for the restart of Lance’s operations following a final investment decision.

Peninsula Managing Director and CEO Wayne Heili said, “The acquisition of physical uranium underpins our focus on transitioning the Lance Project to a low pH ISR operation.

“The addition of physical uranium to our balance sheet offers significant flexibilities and upside potential as we move towards restarting operations.

“It is important to note that the holding of uncommitted uranium inventories at a time when the United States government is under strong and continuing pressure to support nuclear power generation and domestic production of critical minerals like uranium, enhances our ability to participate successfully in expanding market opportunities.

Long-term outlook

A functional uranium inventory also creates flexibility to ensure additional off-take arrangements required for a restart and efficiencies in managing the company’s current long-term sales contract backlog.

Peninsula is already in a unique position for a junior uranium with long-term sales contracts extending through 2030 at prices significantly above current levels.

Uranium purchase agreements have already been made to supply material for the first of the existing sales commitments.

The company expects to achieve a net cash margin of $ 7-8 million in 2021 and $ 8-9 million in 2022.

Placement details

The company will issue a total of 89,335,163 fully paid common shares (10% of the current issued capital) at an issue price of 15 cents per share to raise A $ 13.4 million before fees.

The placement shares are expected to be issued on or around Thursday, June 3, 2021, under the company’s listing rule 7.1 placement capacity and are therefore not subject to shareholder approval.

The issue price represents a 19% discount from the last closing price on May 25, 2021 of 18.5 cents and a 13% discount from the 20-day volume weighted average price of 17.2 cents before May 25, 2021.

(Australia) Limited and Limited acted as co-lead manager of the placement.

Share purchasing plan details

The SPP is expected to be open to eligible Peninsula Energy shareholders from 5:00 p.m. (Perth time) on the registration date of Thursday, May 27, 2021 and whose registered address is in Australia and New Zealand.

Eligible holders will be invited to invest up to a maximum of A $ 30,000 per shareholder in the SPP, subject to any reduction, to raise up to a maximum of A $ 2 million (or approximately 13,333,333 shares) .

Proceeds from the PSP will be used for corporate and working capital purposes.



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