Aura Energy Ltd (ASX:AEE, AIM:AURA) and Curzon Uranium Ltd have struck a restructured offtake deal concerning the Tiris Uranium Project, considerably increasing the project’s financial projections and value.
The restructure will increase the fixed price of uranium by 70%, enhancing revenue and the project's net present value (NPV).
Fixed price raised
Under the new agreement, the fixed price for uranium will rise to US$74.75 per pound from US$44.09, contingent on a final investment decision by March 31, 2025.
This adjustment aligns with a reduction in total contracted uranium volumes from 2.6 million pounds to 2.1 million pounds over a seven-year period, which still ensures considerable financial gains, including an additional US$41 million in revenue based on a uranium price of US$80 per pound.
The project's NPV is projected to increase by US$22 million, reaching US$388 million, while the internal rate of return (IRR) will improve by 2% to 36%.
These changes come after a front-end engineering design (FEED) study conducted in March this year.
Aura has committed to delivering 150,000 pounds of uranium per annum at a fixed rate, alongside an equivalent volume at a spot price less a 4% discount.
The restructuring agreement also includes a fee of US$3.5 million to Curzon, which can be settled in cash or through shares priced at A$0.18 per share.
Further financial adjustments include a US$3.5 million equity placement in Aura by Curzon, with half of these shares to be held in escrow until the final investment decision is made or by June 30, 2025.
Positioned for opportunity
The restructured agreement cancels previous agreements and positions the Tiris Uranium Project in Mauritania for enhanced shareholder returns, bolstering third-party financing opportunities.
Aura MD and CEO Andrew Grove said: “We are very pleased with the cooperation and consideration received from Curzon – a leading global trader in uranium – on this restructured offtake agreement and welcome Curzon as an important partner and Aura shareholder for the development of the Tiris Uranium Project which will have significant mutual benefits for both parties.
“The restructured offtake agreement releases significant value in the project and is another important step in the development of the Tiris Uranium Project.”