Peninsula Energy Ltd (ASX:PEN, OTCQB:PENMF) reaffirms that its Lance Uranium Projects in Wyoming USA are on track for a December 2024 production restart, as the company makes management changes and undertakes site preparations.
“Our teams of workers are busy across the Lance Projects preparing for the resumption of uranium production operations before the end of the year,” Peninsula managing director and chief executive officer Wayne Heili said.
“The progress is evident on many fronts and the team is to be commended for continuing to proceed with safety at the forefront while keeping to the overall schedule."
Short term production revision
The company has provided an updated ramp-up production profile for the project, now expecting 600,000 pounds (lbs) of uranium (U3O8) in CY2025, down from a previous range of 700,000 to 900,000 lbs, reflecting the current status of project-wide development.
However, overall CY2026 and CY2027 production projections for the 2026 and 2027 calendar years are not materially impacted by these early ramp-up stage delays.
“While some aspects of the project development are slightly lagging earlier projections, it is pleasing to know there are no indications that the impacts will extend beyond the initial ramp-up phase” said Heili.
Lance Central Processing Plant
PEN advises that it has agreed with its lead construction contractor to transition the remaining cost of the Lance Central Processing Plant (CPP) expansion construction contract to a fixed cost basis, and to provide mechanical and performance guarantees on the work.
The final CPP capital cost is projected to be US$9.5 million higher than the previous estimate of $39.3 million.
PEN maintains a healthy cash balance of around US$68 million at October 31, 2024 and is fully funded well beyond first production.
The company is also holding advanced stage discussions with potential lenders to secure a working capital debt facility in the event it is needed during the production ramp-up.
Management planning
Peninsula has also advised that it has initiated a comprehensive planning process with respect to succession of long-standing directors and senior management.
“Peninsula has benefited from the long-term dedication of its experienced and capable senior management team and directors who have made an enduring personal commitment to seeing the Lance Projects back into production,” Heili said.
“With that objective now in plain sight, this is the proper time to introduce fresh eyes and a different balance of skills that are required to meet the needs of a fully advanced uranium production company.”
The company is in final negotiations with a well-qualified chief operating officer and says an appointment is imminent.
Additionally, Wayne Heili has indicated he intends to resign from the managing director/CEO role in 2025. An executive search process has been commenced for a new managing director.
Heili said, “After considerable reflection, I wish to share my personal desire to enjoy a more moderately paced lifestyle than that afforded by the responsibilities of my present position.
“It has been my true privilege to work with the Peninsula team over the past seven plus years in tackling some very challenging technical and corporate issues.
“I believe that Peninsula is now in a far better position to succeed with its uranium production ambitions and that this is the proper time to hand the leadership reins over to an individual with a more commercial skillset to match the company’s anticipated future needs.
“I look forward to maintaining a close relationship with the company while serving in an advisory capacity.”
Kendrick Area permitting advances
PEN also reports that the state of Wyoming has now completed its technical review of the applications for the inclusion of the Kendrick Project area into the Ross Project Area Permit to Mine and Source Materials Licences.
It has recommended the Permit to Mine be approved pending completion of a public notice period, which has commenced. PEN expects the Permit to Mine to receive final approval prior to year end.
Ross Central Processing Plant under construction, early November 2024.