Paladin secures seven offtakes for uranium


Paladin Energy, which owns the Langer Heinrich Mine has secured seven offtakes for its uranium production, the company announced this week.

The company said strong demand for nuclear energy is driven by global decarbonisation worldwide. Paladin notes that nuclear energy is the second largest source of global clean energy with almost zero carbon emissions.

It also noted that Chinese demand for nuclear energy is expected to grow from 15% to 33% of global requirements by 2040.

Paladin said 19 million pound of uranium oxide production is contracted to the year 2030 representing 48% of volume. The company also has an offtake agreement with China National Nuclear Corporation (CNNC) one of the largest consumers of uranium in the world.

Paladin owns 75% controlling interest in Langer Heinrich Uranium (LHU) with 25% owned by China National Nuclear Corporation Overseas Uranium Holding Limited, a wholly owned subsidiary of CNNC

Paladin said the 2023 supply-demand deficit of uranium stood at 40 million pounds of uranium oxide. The other factors that will affect near-term supply include the US Ban on Russian supplies and also noting that 70% of European supply is sourced from Kazakhstan, Russia and Niger, which are facing several political uncertainties.

Paladin also noted that term contracting has returned to the uranium market, driven by supply-demand fundamentals and said utilities source over 80% of their uranium requirements from term contract.

The company also noted that spot market price is driven by strong short-term demand and limited available uranium product. It added that uranium physical funds have increased transparency and liquidity in the market.

Paladin added that it has built a world-class offtake contract book, underpinning the restart of Langer Heinrich. The company said the restart project was completed on time and within cost forecast of US$125 million.

It said production has been delivered into a strong uranium pricing environment. The other positives include relationships and offtakes with the largest global nuclear energy counterparties.

The company said Langer Heinrich mine growth priorities include that strong uranium prices will deliver the potential to lower cutoff grade and increase tonnes for mining.

According to the Chamber of Mines of Namibia 2022 Annual Report, a final investment decision was made to return the Langer Heinrich mine back to production in July 2022.

Restart activities included the appointment of an engineering, construction and procurement contractor, detailed engineering and design updates for process upgrades and the purchasing of material and equipment. The restart plan has confirmed a 17-year project life with peak production of up to six million pounds of uranium oxide per annum for the seven years of mining.

In March, Langer Heinrich said uranium concentrate production and drumming were achieved at the mine.

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