Peninsula Energy Targets 1.5M lbs Uranium by 2028 After Production Reset
Peninsula Energy outlines a revised production roadmap for its Lance uranium project in Wyoming, addressing commissioning delays and legacy contract burdens while securing fresh capital to fuel growth amid strong US nuclear energy momentum.
- Delayed commissioning of Lance Central Processing Plant to September quarter 2025
- Revised phased production plan targeting 400,000–600,000 lbs in 2026–27, scaling to 1.2–1.5M lbs by 2028
- Termination of 5.14 million lbs of legacy uranium contracts to eliminate take-or-pay liabilities
- Fully underwritten A$70 million equity raise and US$15 million debt facility secured
- Exploration upside at Kendrick, Barber, and Dagger projects supports long-term growth
A Reset for Lance Amid Operational Challenges
Peninsula Energy Limited has provided a comprehensive update on its flagship Lance uranium project in Wyoming, USA, revealing a strategic reset after encountering commissioning delays and operational hurdles. The Central Processing Plant (CPP), originally scheduled for completion by March 2025, is now expected to be fully commissioned in the September quarter, following setbacks related to weather, supply chain issues, and equipment corrosion.
This delay has necessitated a recalibration of production targets and wellfield designs, with flow rates lower than initially anticipated prompting a reduction in injection well spacing and a more conservative ramp-up plan. The company now projects near-term production of 400,000 to 600,000 pounds of uranium annually in 2026 and 2027, with a longer-term goal of 1.2 to 1.5 million pounds per annum by 2028.
Contract Reset and Financial Repositioning
To underpin this reset plan, Peninsula has secured a fully underwritten equity raise of approximately A$70 million (US$45 million), complemented by a US$15 million debt facility from Davidson Kempner. The capital will fund completion of the CPP, wellfield development, contract termination payments, and exploration activities at Kendrick and Dagger projects, while also supporting working capital needs.
Exploration Upside and Strategic Positioning
The Lance project boasts a substantial JORC-compliant resource of 58 million pounds of uranium, with additional exploration targets at Kendrick, Barber, and Dagger offering significant upside potential. Kendrick is fully permitted and undergoing optimisation studies, while Barber and Dagger represent satellite projects with promising grades and resource expansion opportunities.
Peninsula’s operational approach emphasizes in-situ recovery (ISR) with a low-pH leaching process, a method that promises lower environmental impact and cost efficiencies but remains relatively novel at commercial scale. The company has implemented a series of operational improvements, including redesigned wellfield patterns and enhanced acidification protocols, to address early production challenges.
Leadership Refresh and Market Tailwinds
Alongside operational and financial restructuring, Peninsula has refreshed its board and executive team, bringing in seasoned professionals with extensive uranium and mining experience. This leadership renewal aims to instill operational discipline and clear strategic focus.
The timing of Lance’s ramp-up aligns with robust US government support for domestic uranium production, driven by energy security concerns and a bipartisan push to expand nuclear power capacity. Policy tailwinds, including executive orders to expedite nuclear project approvals and substantial Department of Energy funding, create a favourable backdrop for Peninsula’s growth ambitions.
Navigating Risks and Looking Ahead
Despite the positive repositioning, Peninsula faces inherent risks including uranium price volatility, operational uncertainties with low-pH ISR technology, regulatory approvals, and the need for shareholder endorsement of tranche 2 equity and convertible debt facilities. The company’s ability to execute the reset plan and achieve production targets will be closely watched by investors.
Overall, Peninsula Energy’s update signals a pragmatic and disciplined approach to unlocking the Lance project’s potential, leveraging strong US nuclear energy demand and a sizeable resource base to build a sustainable uranium supply business.
Bottom Line?
Peninsula’s reset and capital raise set the stage for a critical production ramp-up amid a supportive US nuclear energy landscape, but execution risks remain.
Questions in the middle?
- Will Peninsula secure shareholder approval for the tranche 2 placement and convertible debt facilities?
- How quickly can operational improvements translate into stable, higher flow rates and uranium recovery?
- What impact will uranium price fluctuations have on Peninsula’s financial outlook during the ramp-up phase?
