Lotus (ASX:LOT) rattles the tin for $30m for African uranium vision
February 23, 2024Lotus Resources is undertaking a $30 million placement to accelerate the restart of an African mine and the development of the company’s uranium assets in the region.
The placement is for 100 million new shares at 30c a piece to strategic investors, with Paradice Investment Management in for $20m and a seat as a substantial Lotus shareholder with a 5.5 per cent interest.
Lotus is targeting a restart at the end of 2025 at the Kayelekera mine in Malawi, a globally eminent uranium asset which produced roughly 11 million pounds of triuranium octoxide equivalent over five years before a 2014 shutdown.
Shutters were put on in times of lower prices, but with a yellowcake cost exceeding US$100 a pound ($153/lb) after doubling its price over the past year, Lotus stand to benefit from heady current and forecast market fundamentals.
Lotus Resources Managing Director Keith Bowes said the company’s placement has attracted significant interest from high-calibre strategic investors who shared a bullish view on uranium.
“Our key priority remains progressing restart plans for Kayelekera to benefit from the increased demand for Kayelekera product and current strong and increasing uranium prices, but we also recognise that moving forward quickly with Letlhakane will enhance the company’s valuation,” Mr Bowes said.
The Letlhakane Uranium Project sits in mining-friendly Botswana and currently holds a resource base of 269 million tonnes at 321 parts per million U3O8 for 190 million pounds of contained uranium, figures which place it as one of the world’s largest undeveloped uranium assets.
Lotus is planning an updated resource for the June quarter of this year at Letlhakane, with either a scoping study or preliminary economic assessment expected later into 2024.
Uranium began a price ascension after 22 nations made a pledge to triple nuclear output by 2050, and a global shift toward the power source to meet emissions targets has been tipped to push prices further skyward.
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