Peninsula Energy Limited (PENMF)

Peninsula Energy resumes production at Lance Uranium Projects; appoints new leadership

Peninsula Energy Ltd successfully restarted operations at its flagship Lance Uranium Projects in Wyoming, USA, in late December 2024, marking a significant milestone after a five-year hiatus. Production recommenced within selected areas of Mine Unit 1 (MU-1) as a low-pH in-situ recovery (ISR) operation, positioning Peninsula as an emerging independent producer of uranium yellowcake. Early-stage operations captured approximately 1,000 pounds of uranium in ion exchange resins, with initial flow rates and grades aligning with planned expectations. These figures are anticipated to improve as preconditioning progresses across additional Header Houses. Progress at Lance continued with the well installation program at Mine Unit 3 (MU-3), alongside preconditioning at Header House 11 (HH-11). Meanwhile, construction of the yellowcake filtration and drying circuits remains underway, with Peninsula expecting to produce its first dry yellowcake in the June 2025 quarter. Peninsula advanced the expansion of the Ross uranium recovery plant at Lance, originally built in 2015 as an alkaline in-situ recovery (ISR) satellite plant. The expansion includes a central processing plant (CPP) designed for low-pH ISR production and capable of producing finished dry yellowcake. The Phase II expansion adds ion-exchange circuit capacity, resin elution, precipitation, filtration and product drying circuits. During the quarter, construction efforts focused on installing HVAC systems, pipe racks, cable trays, equipment and electrical connections. The first of two yellowcake dryers was delivered in December 2024. Upon completion, the facility will feature a 5,000 gallons per minute uranium recovery ion exchange plant with the capacity to produce up to 2 million pounds of U₃O₈ per annum. Peninsula and engineering contractors Samuel Engineering, Inc. and Samuel EPC, LLC agreed to convert the EPC contract to a fixed lump sum, adding US$6.3 million in costs. Other workstreams at the CPP saw an additional US$3.2 million in cost increases. The total project cost is now estimated at US$49 million, including a US$9.5 million overrun. The revised agreement includes performance guarantees. Weather and supply chain challenges have delayed completion, now expected in the June quarter of 2025, with first yellowcake production scheduled in the same quarter. Sequential commissioning of elution, precipitation and filtration circuits will continue as construction is completed. During the quarter, Peninsula incurred approximately US$21.3 million in plant expansion costs. In other news… Alongside plant construction, Peninsula continued advancing new wellfield production areas at Mine Unit 3 and Mine Unit 4 (MU-4). In November, the company secured agreements for three additional drill rigs, bringing the total external contractor drill rig count for 2025 to 16. Preconditioning operations began at the newly developed HH-11 area of MU-3 in November, following a six-week delay due to challenges in commissioning the new acid storage and delivery systems. Wellfield development costs for the quarter totalled approximately US$4.3 million. At the end of 2022, Peninsula applied to the Wyoming Department of Environmental Quality (WDEQ) Land Quality Division to incorporate the Kendrick Project area into the 'Ross Project Area Permit to Mine and Source Materials Licenses'. Following the reporting period, the WDEQ approved an amendment to expand the mine permit area to include Kendrick. The Wyoming Uranium Recovery Program is also reviewing an amendment for the inclusion of Kendrick in the 'Lance Source Materials License', with completion expected by late Q1 2025. Both approvals are required before uranium recovery can begin at Kendrick. The Dagger Project, introduced in October 2023, is a high-grade satellite uranium development in Crook County, Wyoming, within the Black Hills district. It is approximately 20 kilometres northeast of Peninsula’s Ross Processing Plant at the Lance Project. Dagger hosts a JORC (2012) inferred resource of 6.9 million pounds of triuranium octoxide (U3O8) at an average grade of 1,037 parts per million (ppm), more than double the grade of U3O8 at Lance. The project presents an opportunity to extend the Lance Project’s life through a satellite in situ recovery (ISR) operation. In November, Peninsula appointed Frederic Guerin as chief operating officer and senior vice president of geology, effective November 25, 2024. He is responsible for overseeing mining and processing operations, ensuring on-time performance, budget adherence and compliance with safety and environmental standards. Guerin brings 30 years of international uranium industry experience, having held key roles in Canada, France, Mongolia, and Uzbekistan, including leadership in low-pH ISR project development. Following a structured succession planning process, Peninsula appointed George Bauk as managing director and chief executive officer, effective January 20, 2025. His appointment follows Wayne Heili’s decision to step down in 2025, with Heili remaining as a technical advisor to support key commissioning and production targets. Bauk has more than 30 years of global experience in uranium, rare earths, gold, lithium and graphite. He has led major projects from exploration to production and raised in excess of A$670 million through equity, debt financing and government grants. His strong industry and political connections span Australia, the USA, and key global markets. Financially, Peninsula ended the year with US$44.9 million in cash as of December 31, 2024. The company also completed a 20-for-1 share consolidation, streamlining its capital structure. Evion Group NL has raised A$1.33 million in a rights issue and is well-funded to continue with the ramp-up to full expandable graphite production at the Panthera Joint Venture in India. The well-supported non-renounceable entitlement offer at 2.3 cents per new share has buoyed the company as sales of expandable graphite from the Panthera JV are exceeding budgeted expectations. This level of support is considered by the Evion Group board to be pleasing and supports the company’s plans to double the scale of production at the JV. The non-renounceable entitlement offer gave eligible shareholders the opportunity to subscribe for one new share in the company for every three existing shares held. Total subscriptions for 57,998,905 new shares were received from eligible shareholders, to raise $1,333,975, before costs, and the board thanks all shareholders who participated for their ongoing support of the company. Demonstrating their confidence in the outlook and strategic direction of the company, Evion’s chair Heather Zampatti and managing director David Round contributed to the rights issue. The company reserves the right to place the shortfall shares at any time within three months of the close of the rights issue. Funds raised will be applied to: Trading of the shares to be issued under the rights issue is anticipated to begin on Monday, February 10, 2025. An Appendix 2A will be lodged with ASX prior to Noon AEST on Friday, February 7, 2025, to apply for quotation of the shares. The company will undertake a separate pro-rata non-renounceable entitlement issue of options in which eligible shareholders registered on the record date will be entitled to participate. Key terms of this bonus offer will include: Euroz Hartleys will act as lead manager to the shortfall placement and bonus options offer. Full details of the bonus options offer will be set out in a prospectus which the company intends to lodge with ASIC and ASX on Monday, February 17, 2025. Combined with ongoing engagement with offtakers and potential new customers, the company has a robust outlook for the Panthera JV.