Peninsula Energy Ltd. said Feb. 1 that it sold part of its long-term uranium concentrate agreements covering 935,000 pounds of triuranium octoxide, or U3O8, for US$19 million in cash.
The delivery commitments were to be fulfilled between 2018 and 2021. The company also sold its right to purchase 900,000 pounds of U3O8 between 2018 and 2020.
Wayne Heili, Peninsula Energy's managing director and CEO, said the cash will enable the company to advance production optimization efforts at the Lance uranium property in Wyoming.
Following the sale, Peninsula Energy has up to 6.6 million pounds of U3O8 remaining under contract for delivery between 2018 and 2030 with customers in North America and Europe.
The weighted-average delivery price of these contracts is US$51/lb to US$53/lb of U3O8. Deliveries under the agreements will be a combination of uranium sourced from Lance and open-origin uranium the company may purchase on the open market.
Thanks to the sale, Peninsula Energy does not expect to need a working capital facility in the next one to two years. As a result, it did not extend an Investec working capital facility, which has been undrawn since October 2017.
