NexGen Energy (TSX:NXE,NYSE:NXE,ASX:NXG) said on Wednesday (December 4) that it has set up its first uranium sales agreements with several leading US nuclear utility companies.
These contracts, starting in 2029, cover the delivery of 5 million pounds of uranium over a five year period and employ market-related pricing mechanisms to optimize returns by leveraging future uranium prices.
The uranium will be sourced from NexGen’s Rook I Project in Saskatchewan, Canada, which the company believes is positioned to become one of the largest uranium-mining operations globally.
NexGen estimates that over 231 million pounds of uncommitted probable mineral reserves remain available.
Rook I is currently in the development stage, with NexGen reaching a key milestone in the federal environmental assessment process in mid-November. The Canadian Nuclear Safety Commission let the company know that it has completed the federal technical review process and can now schedule a commission hearing date for Rook I.
After that happens, NexGen will receive an approval decision on the project from the commission.
Leigh Curyer, NexGen’s CEO, said on Wednesday that the company’s contracts with prominent US utilities demonstrate the project’s quality and offer diversification for global uranium supply.
The deals come amid increasing energy demand and heightened risks surrounding uranium supply security.
The contracts outline annual deliveries of 1 million pounds of U3O8 starting in 2029. At varying price points — ranging from US$80 to US$175 per pound — NexGen projects significant gross sales revenues during the term.
According to Curyer, the contracts reflect growing interest in expanding nuclear energy infrastructure to meet rising energy demands, while addressing supply chain vulnerabilities.
“Energy demand from reliable sources is increasing by the week with the need to expand existing nuclear energy infrastructure and the construction of power consuming data centres at a time the security of uranium supply is under significant technical and sovereign risk,” he said in the company’s announcement.
The news also comes as NexGen continues discussions with utilities in Europe, Asia and other regions.
Securities Disclosure: I, Giann Liguid, hold no direct investment interest in any company mentioned in this article.