Bannerman Signs Two Offtake Deals for 1 Million Pounds of Uranium from Etango
Bannerman Energy has locked in two binding offtake agreements with major North American utilities for 1 million pounds of uranium from its Etango project, marking a significant milestone ahead of its final investment decision.
- Two binding offtake agreements secured for 1 million pounds of uranium over five years
- Contracts with Tier 1 North American utilities include flexible delivery terms
- Price escalation linked to US GDP-Implicit Price Deflator starting year five
- Etango project positioned as a credible new uranium supply source
- Agreements subject to regulatory approvals and align with phased project development
Strategic Offtake Agreements Mark a Milestone
Bannerman Energy Ltd has announced the execution of two binding offtake agreements with two of North America’s largest energy providers, each boasting investment-grade credit ratings and extensive power generation portfolios. These contracts cover the sale of 1 million pounds of uranium over a five-year period from 2029 to 2033, sourced from Bannerman’s flagship Etango Uranium Project in Namibia.
The agreements include a flexible delivery clause allowing the utilities to adjust volumes by plus or minus 10% annually, providing Bannerman with strategic patience as it advances towards a final investment decision (FID) on Etango. This flexibility is a key feature, enabling the company to respond to evolving market conditions while preserving capacity.
Pricing Structure Reflects Market Realities
Both contracts are structured with a base price reflective of current long-term uranium price indices, with escalation provisions tied to the US GDP-Implicit Price Deflator commencing in the fifth year of delivery. This approach balances revenue stability with exposure to potential market price increases, aligning with Bannerman’s broader marketing strategy to build a top-tier portfolio of uranium sales agreements that capture future market upside.
These agreements represent Bannerman’s first binding offtake contracts, a significant validation of Etango’s standing as a credible new supply source amid tightening uranium markets and growing global nuclear demand. The company’s CEO, Gavin Chamberlain, highlighted that these contracts demonstrate to potential customers Bannerman’s capability to meet future supply commitments, reinforcing its strategic position in the nuclear fuel sector.
Etango Project – Advanced and Ready
Etango benefits from over 15 years of exploration and feasibility work, including a Definitive Feasibility Study completed in late 2022 confirming the technical and economic viability of open-pit mining and heap leach processing. The project has secured all necessary environmental approvals and a mining licence awarded in December 2023, positioning it well for development.
With an average annual output forecast of 3.5 million pounds of uranium oxide, and potential expansion to 6.7 million pounds, Etango is poised to become a significant player in the uranium market. Namibia’s stable political environment and strong support for uranium mining further enhance the project’s attractiveness.
Looking Ahead
Bannerman’s phased development and marketing approach means these offtake agreements are just the beginning. The company plans to progressively layer in additional contracts as market fundamentals strengthen, maintaining flexibility to optimise pricing and delivery. Regulatory approvals remain a condition precedent, and the identities of the utility counterparties remain confidential, consistent with market norms.
Overall, these agreements mark a critical step in Bannerman’s journey to becoming a trusted long-term uranium supplier, reflecting both the strategic importance of Etango and the broader resurgence in nuclear energy demand globally.
Bottom Line?
Bannerman’s first binding uranium sales contracts set the stage for Etango’s development amid tightening markets and rising nuclear demand.
Questions in the middle?
- Which utilities are behind the undisclosed offtake agreements and what are their long-term uranium needs?
- How will regulatory approvals impact the timing and execution of these contracts?
- What are Bannerman’s plans for additional offtake agreements as Etango advances?
