Peninsula Energy (ASX: PEN; US-OTC: PENMF) announced Thursday it has restarted operations at its flagship Lance project in Wyoming following a five-year hiatus, making the Australian company the newest uranium supplier in North America. Shares rose.
The Lance project represents one of the largest uranium projects in the United States by size and scale, with a defined JORC (2012) resource of 58 million lb. of uranium oxide (U3O8). The mine restart plan envisions an initial 10-year in-situ recovery (ISR) operation with a production estimate of 4.1 million lb. from the Ross area, then moving onto the Kendrick area.
The restart of production at Lance as a low-pH ISR operation marks a historic milestone for Peninsula on its journey to become a fully independent producer of uranium yellowcake, the company said.
“We have restarted Lance at an opportune time, with the long-term fundamentals and demand for uranium incredibly strong, as nuclear energy grows into the leading and most reliable clean energy solution,” Peninsula CEO and managing director Wayne Heili said in a release. “Through Lance, Peninsula will provide a secure and sustainable uranium supply for an energy-hungry, low-carbon future.”
Uranium tailwinds
The restart comes at the end of a year when uranium spot prices reached a high in January of US$106 per lb., last seen 17 years ago amid rising demand for nuclear energy as an alternative to fossil fuels.
Peninsula shares gained 6.5% to A$1.14 in Sydney on Thursday, giving the company a market capitalization of A$180.3 million. Its shares traded in a 52-week range of A$1.01 to A$2.82.
Production at Lance is to initially come from selected areas of Mine Unit 1 and be routed to the rebuilt Phase 1 satellite plant ion exchange system for uranium capture. According to Peninsula, the flow rates and grades are so far matching the planned levels and are expected to continue increasing as preconditioning is completed in subsequent header houses and a chemical oxidant (hydrogen peroxide) is introduced.
The captured uranium will be stored inside the ion exchange resin in the second-stage plant area, which is scheduled for full commissioning in the first quarter of next year.
Construction of the second stage plant area is currently underway, with Peninsula focused on completing the resin elution and precipitation circuits by mid-January, allowing first elutions and yellowcake precipitation. This will be followed by construction of the yellowcake filtration and drying circuits, currently scheduled for February, which would then lead to production of the first dry yellowcake product by early March.
When the second stage construction is finished, the Lance projects will be home to a 5,000 gallons-per-minute uranium recovery ion-exchange process plant, with the capability to independently produce up to 2 million lb. per year of dry yellowcake (U3O8) product, the company said.
Peninsula is anticipating 600,000 lb. of U3O8 production at Lance during the 2025 ramp-up year, down from its earlier forecast of 700,000 to 900,000 pounds. This revised guidance was due to delays in preconditioning the newly developed header house at Mine Unit 3.
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