Peninsula Energy Ltd (ASX:PEN, OTCQB:PENMF) sees the acquisition by Uranium Royalty Corp (URC) of an existing 1% gross revenue royalty over PEN's Lance Projects as a strong endorsement of the Wyoming project and uranium market prospects.
On April 1, URC announced that it would acquire a royalty interest on Peninsula’s flagship Lance Projects in Wyoming, USA, constructed and operated by Strata Energy Inc, a wholly-owned subsidiary of Peninsula.
URC has acquired an existing 1% gross revenue royalty interest, covering the entirety of the defined Lance Projects area for US$1.25 million in cash from a third-party holder.
The royalty purchase builds on another existing royalty held by URC, which only covered a limited area of Lance.
Strong endorsement
Peninsula sees URC’s royalty acquisition as a strong endorsement of both the emerging Lance Projects and the broader global uranium and nuclear market trajectory.
URC is the world’s only uranium-focused royalty and streaming company and has deep industry knowledge and the expertise to identify and evaluate investment opportunities in the uranium industry.
URC’s management team and board include individuals with decades of combined experience in the uranium and nuclear energy sectors.
The royalty interests now held by URC were pledged by Peninsula when the Lance Projects were first being developed, so there is no new royalty obligation created by this transfer between outside parties.
About Lance
Lance is an in-situ recovery (ISR) uranium project on the northeast flank of the Powder River Basin in Wyoming, USA.
The project is comprised of 38,416 acres of mixed surface and mineral right holdings including private access agreements and state and federal mineral claims.
Peninsula has a JORC-compliant resource comprised of measured and indicated resources totalling 15.8 million pounds U3O8 and inferred resources of 37.8 million pounds U3O8 for a total of 53.6 million pounds U3O8.
The project was licensed and constructed by Strata and commenced commercial operations in 2015.
Production operations were idled in mid-2019 to focus on transitioning from alkaline based ISR operations to low-pH based ISR operations.
On March 28, the company announced that it is commencing an update to its 2018 low-pH ISR feasibility study, which will incorporate the results and conclusions from its technical de-risking activities, including the recently completed MU1A field demonstration. The updated feasibility study is expected in the third quarter of this year.
About Peninsula Energy
Peninsula Energy is an ASX-listed uranium mining company that commenced in-situ recovery operations in 2015 at its 100% owned Lance Projects in Wyoming, USA.
The company is embarking on a project transformation initiative at the Lance Projects to change from an alkaline ISR operation to a low-pH ISR operation. It aims to align the operating performance and cost profile of the project with industry-leading global uranium production projects.