Q1 2024 NexGen Energy Ltd Earnings Call
Julie: Good morning, my name is Julie, and I will be your conference operator today. At this time, I would like to welcome everyone to the NexGen Energy Q1 2024 Financial Results Conference Call. All lines have been placed on mute to prevent any background noise.
Good morning, My name is.
Julie.
Conference.
Okay.
Julie: After the speaker's remarks, there will be a question and answer session at the end. If you'd like to ask a question during this time, simply press the star, then the number 1 on your telephone keypad. If you would like to withdraw your questions, please press star 1. Before we begin, please note that the following caution respecting forward-looking statements is made on behalf of NexGen Energy and all of its representatives on this call. The following statements made on this call will contain forward-looking information that involves risks and uncertainties. Actual results could differ materially from a conclusion, forecast, or projection in the foregoing information, and Mattiel Factors Assumptions were applied.
Nexgen: At this time I would like to welcome everyone to the Nexgen.
Speaker Change: Q1, 'twenty 'twenty four.
Julie: <unk> conference call.
Speaker Change: All lines have been placed on mute to prevent any background noise.
Speaker Change: The speakers remarks, there will be.
Speaker Change: A question and answer session at the end.
Speaker Change: If you'd like to ask a question this time.
Speaker Change: Number one on your telephone keypad.
Speaker Change: A question Please press star two.
Nextgen Energy: Before I begin please note that the following caution respecting forward looking statement, which is made on behalf of Nextgen energy and all of its representatives on this call.
Speaker Change: The statements made on this call.
Nextgen Energy: Forward looking information that involves risks and uncertainties.
Nextgen Energy: Actual results could differ materially.
Nextgen Energy: The forecast or projection and the forward looking information.
Nextgen Energy: Certain material factors or assumptions were applied in producing forecasts and projections are detailed in the forward looking information.
Speaker Change: Additional information about those material factors and assumptions are contained in it.
Nextgen Energy: Next Gen NRG filings.
Nextgen Energy: Available on SEDAR website check all W that Peter.
Nextgen Energy: Mr. Li carrier.
Nextgen Energy: Oh.
Nextgen Energy: Victor.
Victor: <unk> energy you may begin your conference.
Julie: Produced by the U.S. Department of State, are detailed in the foregoing information. Additional information about those material factors and assumptions is contained in NexGen Energy's filings, and they are available on CDERplus, the CDERplus website at www.cederplus.ca. Leigh Curyer, CEO and Director of NexGen Energy, you may begin your, Thank you, Julie. Welcome and thank you to all our shareholders and stakeholders around the world for joining NexGen's Q1 2024 Update and Financial Results Call. I'm Leigh Curyer, Founder and Chief Executive Officer of NexGen Energy. Joining me on the call today is Travis McPherson, Chief Commercial Officer, and Ben Salter, Chief Financial Officer.
Julie: Thank you Julie welcome and thank you to shareholders and stakeholders around the world, but joining Nextgen <unk> Q1 2024 update.
Julie: <unk> financial results call on the cardio founder and Chief Executive Officer of Nextgen Energy joining me on the call today is credits Mcpherson Chief commercial officer.
Benjamin Salter: And Ben Solta, Chief Financial Officer.
Leigh Robert Curyer: From a company and industry perspective, it's been a great first quarter to 2024. Now I'll commence by providing an update on the industry landscape and uranium market, which is entering into an unprecedented phase with last night President of the United States Joe Biden signing into law legislation that bans the import of Russian uranium and unlocking $2.7 billion in spending to support the build-up of US domestic uranium supply. This purely reflects the particularly high risk surrounding a large percentage of current mine sources and available supplies, and will provide progress in advancing the Rook One project, specifically federal permitting, which is in the final stages with the CNSE project development, with respect to front end engineering design and detailed engineering progress.
Benjamin Salter: And our company and industry perspective, it's been a great first quarter 'twenty 'twenty four now commenced by providing an update on the industry landscape and uranium market, which is entering into an unprecedented fight with lost not president of the United States, Joe Biden signing into law.
Benjamin Salter: And that bank imports of Russian uranium.
Benjamin Salter: Roughly $2 7 billion in spending.
Benjamin Salter: The buildup of U S domestic uranium supply.
Benjamin Salter: It's purely reflects the particularly high risk surrounding a large percentage of talent mine sources and available supplies.
Benjamin Salter: Provide a progress in advancing the <unk> one project, specifically federal permitting which is in the final stages with the San Jose.
Speaker Change: Jake development with respect to front end engineering design and detailed engineering progress.
Leigh Robert Curyer: Exploration, which includes the early stage discovery of new mineralization in the first drill hole at the target on an entirely new conductor corridor 3.5 kilometers from the one that hosts the Mighty Arrow deposit, and Finance, including discussion related to two transactions in the last fortnight, the Australian dollar 250 million CDIs raised exclusively on the ASX, which closed pre-market this morning, and the strategic purchase of 2.7 million pounds of eutheroate which, NexGen, on closing, now has cash and liquid assets of approximately $930 million Canadian in preparation for the construction of the Rook One project.
Jake: Exploration, which includes the early stage discovery of new mineralization in the finish through hall at the target on an entirely new conducted Colorado three five kilometers from the one the highest commodity alloy composite.
Jake: And financing.
Speaker Change: <unk> discussion related to two transactions in the last fortnight.
Heathrow lights: <unk> 250 million <unk> writes exclusively on the IL, six which closed this morning pre market and the strategic purchase of $3 7 million pounds of Heathrow lights, which given last night's Bang Bang passed into law is ultimately very very timely.
Nextgen Energy: Nextgen closing now has cash and liquid assets of approximately $930 million Canadian in preparation for construction of the <unk> project.
Leigh Robert Curyer: After this discussion, I'll then move into a Q&A portion of the call where I invite you all to ask questions. In the last six months, we're highly encouraged to see governments worldwide adopt energy policies and strategies that are aligning strongly with NexGen's recognition back in 2011 of the role sustainable and cost-effective nuclear energy will play in the 2020 decade and beyond. Increasingly, nuclear energy is being recognized as a critical component of the global energy mix, addressing the need for clean, efficient, and secure energy sources.
Heathrow lights: After this discussion I will then move into our Q&A portion on the call.
Speaker Change: I invite you all to ask questions.
Nextgen Energy: In the last six months, we're highly encouraged to see governments worldwide adult energy policy and strategy. There are aligning strongly with mix change recognition back in 2011 of the row sustainable and cost effective nuclear energy will play in the 'twenty 'twenty decade and beyond.
Speaker Change: Increasingly clear as being recognized as the critical component of the global energy mix addressing the need for clean efficient and secure energy sources.
Leigh Robert Curyer: The world is on an aggressive path to bring more nuclear power online by 2050, both in the form of new builds in places like China, India, the UAE, the UK, and France, as well as restarts and extensions in large and key nuclear markets such as Western Europe, Japan, South Korea, and the United States.
Speaker Change: The world is on an aggressive path to bring more nuclear power online tripling by 2050 spiked in the form of new builds in places like China.
Speaker Change: India.
Speaker Change: E U K and France, as well as restarts and extensions and lodge in key markets such as Western Europe.
Speaker Change: Japan, South Korea, and the United States.
Leigh Robert Curyer: This expansion is increasingly critical as the electrification of our world accelerates, notably through the expanding adoption of artificial intelligence and electric vehicles, both made or liable, and Base Flow Power, leading to a paradigm shift in the energy market. We've seen this urgent need for a nuclear renaissance expressed by many thought leaders, including tech giants such as Microsoft and Amazon, as well as the likes of Sam Altman, OpenAI, and Brad Gerstner, legendary venture investors.
Speaker Change: This expansion is increasingly critical as the electrification of that world accelerates Nigel blade three they expand the adoption of artificial intelligence and electric vehicles.
Speaker Change: NATO reliable and by slide power source.
Speaker Change: Leading to a paradigm shift in the energy market.
Speaker Change: Same resurgent rate for nuclear Renaissance to continue expressed by many thought leaders, including Tech Giants, such as Microsoft and Amazon as well as the likes of Sam Altman overnight yacht and Brad guess, Matt legendary venture investors.
Leigh Robert Curyer: The market is robust, sustainable, and growing significantly faster than anyone forecasts, causing the focus to shift to the ability of the industry to supply this key energy fuel. Supply, however, tells a different story, a narrative of fragility and decline.
Speaker Change: Demand is robust.
Unknown Executive: <unk> been growing significantly faster than any one forecast, causing the prices is shipped to the ability of the industry.
Unknown Executive: Fly these key energy steel.
Speaker Change: Apply however tells a different story.
Speaker Change: Narrative of agility and decline.
Leigh Robert Curyer: The confluence of over a decade of extreme underinvestment, supply disruptions, dwindling inventories, and the overlay of significant geopolitical risk is precipitating a new market reality, one in need of more dependable uranium sources, and has led to uranium spot prices during this past quarter reaching new 15-year highs at $107 US a pound. In the face of supply challenges, new sources must be found through purposeful exploration efforts and then developed, which takes time, even for those companies doing that good work like ourselves and our Canadian Development Company colleagues, Denison, Fission, UEC, and ISO Energy in Canada. It's not simple, convenient, or quick to find and develop any mineral project.
Apply: The confluence of over a decade of extreme underinvestment.
Speaker Change: Supply disruptions.
Speaker Change: Lean inventories with the either lab significant geopolitical risk is pretty sick tightening a new market reality.
Speaker Change: One is made of more dependable youre, writing sauces and has led to the right spot. During this past quarter <unk> picked a new highs at $107 U S.
Speaker Change: In the face of supply challenges resources must be bound to the purposeful exploration efforts and then developed.
Denison region: Tight time, even for those companies doing that good wet like ourselves and our Canadian development company colleagues Denison region.
Speaker Change: You say and also energy tenant.
Denison region: Its not simple convenient all quick to find to develop any mineral project. It's at least a minimum of 15 years before the movie.
Leigh Robert Curyer: Since it's at least a minimum of 15 years before new, undiscovered sources come online, it's more important than ever to advance the Rook One project into production this decade, and the NexGen team is delivering on that objective. In Canada, the federal government has recognized its importance and strongly emphasized its commitment to expanding the nuclear sector both domestically and globally. This includes efforts to expedite the approval process for nuclear projects in Canada and increase funding availability, as highlighted in the most recent federal budget.
Denison region: Discovered sources come.
Denison region: Come online.
Nextgen Pain: It's more important than ever to advance through Kwan project into production. This decade, and the Nextgen pain is delivering on that objective.
Speaker Change: In Canada, the federal government is recognizing its importance and strongly emphasize its commitment to expanding the nuclear sector, both domestically and globally.
Federal Government: This includes efforts to expedite the approval process for nuclear projects in Canada and increased funding availability as highlighted in the most recent federal budget.
Leigh Robert Curyer: NextGen is a Rook One project, and all its shareholders and stakeholders are extremely well positioned for this Canadian government commitment. The importance and reality of the need for allied supply chains were bluntly reflected last night with the signing of the Prohibiting Russian Uranium Imports Act.
Federal Government: Nextgen is broke one project and.
Nextgen: And all its shareholders and stakeholders are extremely well positioned for these Canadian government commitment.
Canadian government: The importance and reality for the need of a large supply chains was bluntly reflected last month with the signing prohibiting Russian uranium imports Act.
Leigh Robert Curyer: This is set to take effect in 90 days, spanning U.S. imports of Russian uranium in a phased manner through 2028. This legislation begins a new, unprecedented era in the uranium market, and it is expected to tighten the market considerably, leading to significant and long-term upward pressure on uranium prices. Consequently, for all these reasons, utilities are seeking to diversify their highly concentrated nuclear fuel supply chains in allied jurisdictions. The Rook One project stands out as the world's largest and lowest cost future producer for an exceptionally sound technical and environmental setting, evident by its vertically stacked ore body that is large. Hi Graham, and it is located in ideal hard rock conditions with clean ore, making it truly unparalleled in the global uranium landscape.
Nextgen: This is set to take effect 90 days spanning U S imports of Russian uranium in a phased manner through 2028.
Nextgen: This legislation begins at noon and price it into the euro uranium market.
Nextgen: As expected the top of the market considerably leading to significant and long term upward pressure on uranium prices.
Speaker Change: Consequently for all these reasons utilities are seeking to diversify their highly concentrated nuclear fuel.
Speaker Change: Fuel supply chains in Adelaide jurisdictions.
Speaker Change: The Rubicon project stands out as the world's largest and lowest cost future producer.
Speaker Change: For an exceptionally sound technical and environmental setting evident by its vertically stacked ore body that is large.
Speaker Change: Hi, great.
Clayton: Like how did it all ideal hard rock conditions, with Clayton or making it truly unparalleled in the global uranium landscape.
Leigh Robert Curyer: We're encouraged to know that our valued government partners and local communities acknowledge the importance of ROOC1's generational profile and recognize that ROOC1 will cement Canada as a global leader in the delivery of uranium as part of the green energy solution. Looking ahead. NexGen is energised to progress the Rook One project into construction and production through our innovative culture, deep expertise, operational excellence, and our collective commitment to being a key contributor to the essential global clean energy transition.
Clayton: We're encouraged tonight that our value government partners and local communities acknowledged the importance of work once generational profile.
Roke: Recognize that Roke won will cement, Canada as a global leader in the delivery of uranium as part of the Green energy solution.
Roke: Looking ahead.
Speaker Change: Next Gen Z energize to progress that work one project into construction and production through our innovative culture deep expertise operational excellence.
Speaker Change: And our collective commitment to being a key contributor to the essential global clean energy transition.
Leigh Robert Curyer: In the first quarter, we continue to execute our strategy to permit Rook One for construction. After receiving Saskatchewan Provincial Environmental Approval of the ROOC1 project on November 8, 2023, which was the first green-filled uranium mine and mill project in Canada to receive Provincial EA approval in over 20 years, we immediately submitted responses to the CNSC technical comments on February 12, 2024, at the conclusion of the prescribed 90 days following that. NexGen received only 49 comments remaining to address, and once done so successfully, it will have concluded the Federal Environmental Impact Study.
Speaker Change: Over the first quarter, we continued to execute our strategy to Rick one for construction.
Speaker Change: After receiving Saskatchewan provincial environmental approval of the required project on November <unk>, 2023, which was the first Greenfield uranium mine and mill project in Canada say.
Speaker Change: Say provincially I approval in 20 years.
Speaker Change: We have mainly submitted responses to the CNS a technical comments on February 12 2024.
CNS: Conclusion of the prescribed 90 days following that submission.
CNS: Nextgen received only 40 non comments remaining to address and what stance either successfully will have concluded the federal environmental impact study.
Leigh Robert Curyer: We are extremely pleased with this CNSC review and have been finalizing our subsequent responses to these remaining 49 comments, which we will be submitting imminently this week or early next and will be reflected in a news release at that time. This is all against the backdrop of full support from our local Indigenous community partners, who have all signed impact benefit agreements with NexGen for the full life cycle of the Rook One project. In project development, the 2023 Site Confirmation Program is informing and validating the final detailed design. Production Exhaust Shafts, and Water Treatment Underground Tailings Management Facility, Mill, and Surface Infrastructure
Nextgen: We're extremely pleased with the same let's say or D and have been finalizing a subsequent responses today's remaining 49 comments, which will be submitting imminently. This week or early next and will be reflected an unusually at that time.
Speaker Change: This is all in the backdrop of full support from our local indigenous community partners.
Shane: It <unk> impact benefit agreements would make Shane on the full lifecycle of Europe one project.
Speaker Change: Yeah.
Shane Europe: On project development. The 2023 sought compromising program is informing and validating the final detailed design of the production exhaust shops water treatment.
Speaker Change: Underground tailings management facility mill and set the surface infrastructure.
Leigh Robert Curyer: This work is estimated to be completed at or around the end of Q2, where we will then provide an updated cost summary on CAPEX, OPEX, and project economics regarding procurement. We are finalizing details of the shaft sinking contract award and advancing the procurement of the mine hoist system, which will be awarded in the near future. Additionally, we are awarding various ancillary site contracts, including the LNG power plant, during the second half of this year.
Shane Europe: This work is estimated to be completed at or around the end of Q2.
Speaker Change: I will then provide an updated cost summary on Capex Opex and project economics.
I: Got in procurement, we are finalizing details of the shafts sinking contract award and advancing the procurement of the mine hoist system, which will be awarded in the near future.
Speaker Change: Additionally, we are awarding various ancillary site contracts, including the LNG power plant during the second half of this year.
Leigh Robert Curyer: As we shared earlier this year, our 2024 Winter Exploration Program returned successful results at a brand new discovery on the Patterson Corridor, which lies 3.5 kilometers east of Arrow on a separate conductor package. The intense mineralization discovered in RK14183 meant that we focused the balance of winter exploration solely on this area to first understand the extent of the system.
I: As we shared earlier this year.
I: Sure.
I: 2020 for Winter exploration program has returned and successful results at a brand new discovery on the Patterson, Colorado <unk>.
Unknown Executive: Slide three five kilometers east of ore on the separate conductor package.
Speaker Change: The intense mineralization discovered in our Kay 14, one 183 meant that we focus the balance of winter exploration solely in this area. So first on the expand.
Speaker Change: And of the system.
Leigh Robert Curyer: The geological similarities between Patterson Corridor East and Arrowhead Star dictated the summer program would focus on this area for a considerable period of time. The early exploration holes at Arrow in early 2014 were hitting the top of the strong and large mineralization below. This discovery and the holes drilled to date suggest a similar setting of an extensive mineralization event in the vicinity.
Speaker Change: The geological similarities between Patterson, Colorado.
Unknown Executive: <unk> stock.
Speaker Change: <unk> guided the summer program focus on this area for a considerable period of time.
Patterson: The early exploration holes at Arrow in early 2014 were hitting the top of the strong and large mineralization below.
Speaker Change: This discovery and the holes drilled to date suggest the similar setting of an extensive mineralized <unk> bank in the vicinity.
Leigh Robert Curyer: Results of the remaining 2023 program are imminently pending, and the 2024 summer drilling program will be commencing late May and will be an expanded program for winter and all on this new discovery. All discoveries have their own unique nature, and this will be no different, but note the execution of this drilling program is incorporating the same industry-leading technical approach and discipline as deployed at Arrow on Discovery and in a manner which was the most time and cost efficient per meter drilled in the discovery of a plus 100 million pound deposit in the world, regarding contracting. Our discussions continue to advance well with the respected nuclear power utilities.
AE: Results of the remaining 2023 program eminently pending in the 'twenty 'twenty four summit drilling program will come AE will be commencing late may and will be an expanded program for winter and all on this new discovery.
AE: Oil discoveries have their own unique nature and this will be no different.
Design Industry: But note the execution of this drilling program is incorporating design industry, leading technical approach and discipline as deployed at.
Speaker Change: On discovery and in a manner, which was the most time and cost efficient permitted drilled and the discovery of a plus 100 million pound deposit in the world.
Speaker Change: Yeah.
Speaker Change: Regarding contracting.
Speaker Change: Our discussions continue to advance well with respected nuclear power utilities.
Leigh Robert Curyer: We have been recognized as a significant producer in the future, with a strong understanding of NexGen's key positioning in any utility's future supply portfolio. As evidenced in industry market commentary, contract negotiations for 2028 and beyond are occurring now. Last week, NexGen announced the purchase of 2.7 million pounds of physical uranium at US$92.50 per pound via the issuance of a US$250 million convertible debenture at a 30% premium to our 5-day BWOPS share price.
Speaker Change: We've been recognized as a significant producer in the future with a strong understanding of Nextgen key positioning in any utilities future supply portfolio.
Speaker Change: As evidenced in industry market commentary contract negotiations for 2020 beyond Howard carrying now.
Speaker Change: Last week, Nextgen announced purchase of $2 7 million pounds of physical uranium at U S $92 50 per pound.
Nextgen: By the issuance of the U S $250 million convertible debenture.
Nextgen: 30% premium to a five day they work share price.
Leigh Robert Curyer: This debenture is on the same terms as those we have successfully executed in the past with CEF Leigh Ka-Shing in 2016 and 2017, Queen's Road Capital, and more recently Salt Patterson's in Australia, which all incorporate an investor rights agreement that contains shareholder voting alignment, standstill, sale, and transfer restriction covenants and anti-hedging through short selling, options, swaps, or derivatives. The rationale to procure uranium now is logical given our stage of development in approaching final permitting, then construction, and more so, the contracting cycle for delivery from 2028 and beyond is occurring now.
Nextgen: This debenture is on the same terms of which we have successfully executed in the past with say yet Lee cashing in 2016 and 17.
Speaker Change: Wayne drive capital and more recently, so patterson's in Australia.
Sophie Patterson: Which all incorporate an investor rights agreement that contains shareholder voting alignment standstill style and transfer restriction covenants and anti hedging through short selling option swaps so derivatives the rash.
Speaker Change: Now to procure uranium now is logical given our stage of development and approaching final permitting and construction and more site contracting cycle for delivery from 2028 and beyond is occurring now that's right brought now.
Leigh Robert Curyer: That's right, right now. Last night's signing of the Russian-Uranian ban, fully enforced by 2028, means the importance of procurement for this time and beyond has even more significantly elevated in the last 24 hours. Nuclear fuel is unique in the sense it's a highly specialized input of production for power utilities that takes many years to procure and is not commonly available if caught short.
Sophie Patterson: Last not signing of the Russian uranium Bang fully enforced by 2028 maintain importance of procurement for this time and beyond.
Sophie Patterson: Has they been more significantly elevated in the last 24 hours.
Sophie Patterson: Nuclear fuel is unique in the sense, it's a highly specialized and put our production propel utilities that takes many years to procure and not commonly available if caught short.
Leigh Robert Curyer: The producers and the spot market are no longer flush with inventory levels to accommodate any unexpected shortfall. Given the supply side dynamics of fragility, utilities are rightfully focused on security of supply now. This purchase shows utilities NexGen has their backs and is a responsible, reliable supplier, reflecting respect and understanding of their risks and requirements for successful operations. With respect to the price of $92.50 per pound, based on recent spot market purchases over the last six months, £100,000 has resulted in greater than a $1.50 upward price move.
Speaker Change: The producers and spot market. He is no longer flush with inventory levels to accommodate any unexpected short folks.
Nextgen: Given the supply side dynamics of fragility utilities are rightfully focused on security of supply now this purchase shows utilities Nextgen has their back and as a responsible reliable supplier, reflecting respect and understanding of their risks and requirements for successful operation.
Nextgen: With respect to the price of <unk> 50 per pound based on recent spot market purchases over the last six months 100000 pounds sustain resulting in greater than $1.50 upward price movement.
Leigh Robert Curyer: We are confident we have purchased extremely diligently and at the same time as enhancing our contracting and debt financing approach. With respect to the debt package, which we will continue to advance through due diligence and schedule completion shortly after federal approval. This includes many different potential avenues, and significant capacity is being evaluated with maintaining leverage to future uranium prices, evidenced by expressions of interest from lenders which now total property US $1.4 billion, which provides substantial excess capacity to fund and execute the project.
Nextgen: We are confident we have purchased extremely diligently and at the same time is enhancing our contracting and debt financing approach.
Speaker Change: With respect to with respect to the debt package, which we will continue to advance through due diligence and scheduled concluding shortly after federal approval.
Speaker Change: This includes many different potential avenues and significant capacity is being evaluated with maintaining leverage to future uranium prices prices.
Speaker Change: Evidenced by expressions of interest from lenders, which now totals approximately U S $1 4 billion.
Speaker Change: <unk> provides substantial excessive capacity to fund and execute the projects.
Leigh Robert Curyer: We continue to experience strong institutional and retail shareholder support from Australia and the broader Asia-Pacific region, who exhibit strong demand for unhedged uranium development opportunities. Our listing and subsequent inclusion in the ASX 300 Index on March the 18th marked a significant milestone reflecting our company's continual commitment to finding new shareholder markets. Thank you, in line with these topics.
Speaker Change: We continue to experience strong institutional and retail shareholders from Australia on the broader Asia Pacific region.
Speaker Change: Who exhibit strong demand for unhedged uranium development opportunities at listing and subsequent inclusion in the ICD 300 index on March 18.
Speaker Change: Not the significant milestone.
Our company: Our company's continued commitment to finding new shareholder markets exposure in <unk>.
Speaker Change: And in the process leveraging optimal outcomes for our shareholders and stakeholders in.
Speaker Change: In line with this objective two weeks ago, Nextgen issued a tonight in $224 million placement.
Leigh Robert Curyer: Two weeks ago, NexGen issued a Canadian $224 million place, which together with the issuance of the $250 million convertible takes our cash and liquid assets to approximately $1.5 billion. 930 million Canadians, and that is excluding our investment in ISO energy. We have significantly addressed the equity component of funding the construction of ROOC1, providing the market with clear visibility of our objective of taking ROOC1 immediately into construction upon receiving federal approval, with the value of that milestone unencumbered.
Nextgen: <unk> investments.
Nextgen: Which together with the issuance of the 250 million convertible.
Nextgen: <unk> cash and liquid assets to approximately.
Nextgen: 913 million Canadian.
Nextgen: And that is excluding our investment in <unk> energy.
Speaker Change: We have significantly address the equity component of funding construction of book, one providing the market with clear visibility of our objective of taking reel one mainly into construction on receiving federal approval with the value of that milestone unencumbered.
Leigh Robert Curyer: In September of 2023, NexGen raised approximately $540 million Canadian with a discount to market being an industry-leading one and a half to 4% discount, while still maintaining sector leading share price performance. Further, this has been during a period when CEF liquidated their shareholding, which represented approximately 18% at the beginning of last September, to only yesterday being advised that it is now holding less than 0.1%.
Nextgen: In September of 2023, Nextgen has raised approximately at 540 million Canadian with a discount to market being an industry, leading one that hop to 4% discount while still mining sector leading share prosper.
Nextgen: <unk> fair.
Nextgen: Further this is buying during a period CES had liquidated their shareholding. This represented approximately 18% at the beginning of last September to only yesterday, saying advised is now holding less than 0.1%.
Leigh Robert Curyer: We are very proud of this investment return to CEF since 2017 of over 500% and equally excited it has been replaced by new, predominantly large Australian based shareholders with an affinity for a new world mining company delivering exceptional returns. By the end of Q1 2024, we will have invested approximately $459 million in the successful exploration and development of the Rook One project. And this has resulted in a current market capitalization of $5.4 billion.
CES: We are very proud of this investment our churn to say, yes since 2017.
Speaker Change: Over 500% and equally excited and is being replaced with new D. Predominantly large Australia by shareholders with an affinity for a new world mining company delivering exceptional returns.
Speaker Change: By the end of Q1 2024, we will have invested approximately 459 million Canadian.
Speaker Change: In the successful exploration and development of the <unk> project.
Speaker Change: This has resulted in our current market capitalization of $5 4 billion Canadian.
Leigh Robert Curyer: The day prior to the announcement of the uranium purchase last week, NexGen hit a new all-time high market capitalization, at Canadian $12.14 per share, and led all year to date one year rolling tables relative to its peers.
Nextgen: The day prior to the announcement of uranium purchase last week Nextgen hit a new all time high market capitalization at Canadian <unk> $12 14 per share.
Speaker Change: Let all year to date, one year rolling tables relative to its PS.
Leigh Robert Curyer: The 2.7 million pound purchase of uranium represented approximately 4% dilution to that market cap and placed NexGen in a far stronger position than it was prior to the announcement. Before we turn to the Q&A, I'd like to mention Susanna Pearce's nomination for election to our Board of Directors at our upcoming AGM in June. This is referenced in the NexGen Management Information Circular issued last week. Mr. Zammet currently serves as President and Country Chair of Shell Canada.
Nextgen: The $3 7 million pound purchase of uranium represented approximately 4% dilution to that market cap and has placed nextgen in a far stronger position than what it was prior to <unk> announcement.
Susanna: Before we turn to the Q&A a lot you mentioned Susanna piece the nomination for election to our board of directors at our upcoming AGM in June and this is referenced in the Nextgen management information circular issued last week.
Susanna Piece: Susanna currently presides as president and country chair of Shell Canada.
Leigh Robert Curyer: Her expertise and experience in the global energy industry and genuine engagement with local Indigenous communities and government stakeholders make her a natural fit for our organization. I encourage everyone to read the NexGen Management Information Circular, which details all aspects of our approach. Governance and Diligence in delivering the world's largest environmentally, socially, and economically viable uranium development project. Our team's strength lies in its diverse composition, enriched by top-tier talent from a variety of backgrounds, reflecting a wide-reaching perspective that enhances our approach. In 2023, total employees by gender were 66% male and 34% female, compared to a Canadian average of females in mining measuring 16%, more than double.
Susanna: Our expertise and experience in the global energy industry and genuine engagement with local indigenous communities and government stakeholders mics are a natural fit for our organization.
Susanna: I encourage everyone to read the Nextgen management information circular which details all aspects of our approach.
Susanna Piece: Governance, and diligence and delivering the world's largest environmentally socially and of late economic uranium development project.
Susanna Piece: Our team strength lies in its diverse composition enriched by top tier talent from a variety of backgrounds, reflecting a wide reaching perspective that enhances our approach in.
Speaker Change: In 2023 total employees by gender statistics, with 66% mile and 34% female.
Susanna Piece: Bachelor Canadian average of Fame housing mining measuring six 8% more than doubled.
Leigh Robert Curyer: Proudly, 80% of Rook One site employees were from the local priority area. Additionally, over $44 million has been spent on local priority area supplies in 2023, which stimulates economic development within local communities and builds long-lasting and self-sustaining community resilience. As we move forward with the project, we continue to add to our high-performance team. Building and investing in a skilled talent pool is central to our continued success and the local economy's success. In summary, we are moving forward with the support of our valued Indigenous partners, our shareholders, the regulatory and governmental authorities, and our dedicated team. As we look toward the rest of 2024, our focus is on advancing the Rook One project.
Speaker Change: Proudly IV Center Brook once all employees were from the local priority area.
Susanna Piece: The 44 million Headspace bank on the local priority priority area suppliers in 2023, which stimulates economic development within local communities and builds long lasting and self sustaining community resilience.
Speaker Change: As we move forward with the projects, we continue to add to our high performance team building and investing in skilled talent pool is central to our continued success in local economies success.
Speaker Change: In summary, we are moving forward with the support of our valued indigenous partners, our shareholders, the regulatory and governmental authorities of that dedicated team.
Susanna Piece: As we look toward the rest of 2024.
Susanna Piece: Our focus is on advancing the <unk> project, we are at a pivotal and exciting time for our company and as always it's a privilege to share our continued growth with you as we work together to secure the energy transition.
Leigh Robert Curyer: We are at a pivotal and exciting time for our company, and, as always, it's a privilege to share our continued growth with you as we work together to secure the energy transition. Now, let's transition to the Q&A, and we encourage questions from all of you. I'll hand it over to the moderator. Thank you. Ladies and gentlemen, should you have a question, please press star 1. Which wire question? Press star
Moderator: Now, let's transition to the Q&A and we encourage questions from all of you I'll hand, it over to the moderator.
Moderator: Thank you ladies and gentlemen, so do you have a question. Please press star one to withdraw your question Press Star two one moment. Please for your first question.
Julie: One moment, please for your first question. Your first question comes from Andrew Wong from RBC. Please go ahead. Hey, good morning, thanks for taking my questions.
Moderator: Your first question comes from Andrew Wong from RBC. Please go ahead.
Andrew D. Wong: So it's great to hear you're about to resubmit the EIS soon. I just kind of wanted some clarity around the timeline. So after you submit, what are the specific steps and timeline that need to happen before a public hearing can be scheduled? And what actually happens during the public hearing?
Andrew D. Wong: Hey, good morning, Thanks for taking my questions.
Andrew D. Wong: Great to hear Youre about to resubmit the EIF soon.
Moderator: I just wanted some clarity around the timeline. So after you submit.
Moderator: What are the specific steps and timeline that needs to happen before a public hearing can be scheduled.
Leigh Robert Curyer: Could there be some public commentary that comes out that needs to be addressed in that process? And then after that, what's the timeline from the public hearing until you get a final decision from the Commission? Yes, thanks, Andrew. Yeah, looks like... We are very pleased with the response that we received from the CNSC. To have 277 questions in the first place, according to our consultants, was unprecedented for this stage of a project.
Moderator: And what actually happens during the public hearing could there be some public commentary that comes out that needs to be addressed you in that process and then after that like what's the timeline before the pop from the public hearing until you get to sort of a final decision from administered.
Moderator: Yes.
Moderator: Andrew Yes, let's say.
Moderator: We're very pleased with the response that we received from the San Jose likes to have 277 questions in the first place according to al.
Andrew D. Wong: Consultants was unprecedented for this stage of the project.
Leigh Robert Curyer: We're down to 49, and they're really, whilst every aspect is very, very important and we're respectful of that, we are submitting it imminently, either late this week or early next. Now, as prescribed by the rules and regulations, the CNSC is entitled to another 90 days to review and close out those remaining 49 aspects. On closing those 49 aspects out, the EIS will be deemed final, at that point. It will then establish a commission hearing date. Now, every project that has gone to a commission hearing has been approved within 60 days.
Andrew D. Wong: We're down to 49 and I really whilst every.
Andrew D. Wong: Aspect is very very important and we're respectful of that.
consultants: We are submitting imminently.
Andrew D. Wong: This week oily next now as prescribed by the roads regulations. They say NSA is entitled to another 90 days to review and close out the remaining 49 aspect.
Andrew D. Wong: Aspects.
NSA: On closing those 49 aspects out the elas will be deemed fun.
NSA: At that point.
NSA: It will then establish a commission hearing date.
Speaker Change #100: Now every project that has gone to a commission hearing has been approved within 60 days.
Leigh Robert Curyer: I think, whilst all aspects are very, very important and material, it's very, very significant with respect to concluding the EIS, and we are very much looking forward to the conclusion of this next 90 day period, which I think is at the end of July, off the top of my head. We very much look forward to those 90 days, that's for sure. Now, with respect to other public comments that can arise, well, the federal government already ran its 120-day public comment period back in 2022.
Speaker Change #100: Think whilst all aspects are very very important and material.
Speaker Change #101: Very very significant.
Speaker Change #102: With respect to concluding the.
Speaker Change #113: And we are very much looking forward at the conclusion of this mix 90 day period, which I think is at the end of July.
Speaker Change #113: Off the top of my head.
Speaker Change #113: And very much look forward to.
Speaker Change #103: That is 90 days.
Speaker Change #102:
Speaker Change #102: For sure now with respect to other public comments that can arise while the federal government.
Speaker Change #105: Has already ran at 120 day public comment period back in 2022.
Leigh Robert Curyer: And those questions that we've already addressed were directed at those public and technical comments. From our perspective, it's done very, very well or has been very rigorous, has incorporated all stakeholders, and this is on the overlay of having 100% community support from the communities in the local project area, who have all reviewed and signed off on the EIS as we have presented to the CMSC. Okay, that's great.
Speaker Change #106: And those questions that we've already addressed were directed at those public and technical comment sorry.
Speaker Change #102: From our perspective, it's very very well.
Speaker Change #102: There has been very rigorous has incorporated all stakeholders and this is on the overlay of having.
Speaker Change #117: 100% community support from the communities and the local project area, who evolve reviewed.
Speaker Change #116: And signed off on the ice as we have presented to the same assay.
Leigh Robert Curyer: And then just talking about the lift line project itself, you've been pretty clear on, I think, your intention to bring it into production. Sounds like there could potentially be a construction start within the next,,,,,,,,,,,,,,,,,,,,,,,,,,,,, So, on receiving federal approval, we'll be in a position to start immediately the following week. We have done 100% engineering of a lot of the site infrastructure aspects, the preliminary works in order to commence construction in earnest, and all the early stage items are 100% engineered.
Speaker Change #102: Okay, that's great.
Speaker Change #102: Then just talking about the project itself, you've been pretty clear on your intention to bring it into production.
Speaker Change #102: Sounds like there could potentially be a construction site within the next.
Speaker Change #258: For the 12 months. So can you just talk about the technical team that you have in place already what's the size of that team right now and how much more do you need to build it out how quickly can you hire the labor force needs to build the project.
Speaker Change #102: Yes sure.
Speaker Change #102: Yes.
Speaker Change #104: On receiving federal approval will be in a position to start immediately the following week.
Speaker Change #104: We have done 100% engineering of a lot of the site infrastructure.
Unknown Executive: <unk> expects the preliminary works in order to commence construction in earnest and all the early stage items, a 100% engineered the remaining engineered items around the specifics in the mill to put that into perspective around the wiring.
Speaker Change #107: And so we're ready.
Leigh Robert Curyer: The remaining engineered items are around the specifics in the middle, to put that into perspective around the wiring, and so we're ready. Subject to Federal Approval to Immediately Start. With respect to the team, we currently have about 76 people in our Saskatoon head technical office, and at NexGen, our culture is absolute responsibility, and so we have a dedicated NexGen person for every aspect of our operations.
Speaker Change #109: Subject to federal approval to immediately stopped.
Speaker Change #111: With respect to the team.
Speaker Change #120: We have currently about 76 people.
NSS Catone: NSS Catone head technical office and at Nextgen Agriculture is.
NSS Catone: Absolute responsibility and so we have a dedicated nexgen person for every aspect of our operations and that's that's not just.
Leigh Robert Curyer: That's not just the construction of the project that exhibits geology, the financial side, the commercial side, everything. So we have been very, very strategic and well-planned in acquiring the personnel and the technical expertise that we want since 2017. We knew at that stage we had a project, and we're taking it forward into production. That's elevated as we speak, and to give you one example, like on the safety side of things, we're now breaking that out into very specific areas of safety, on the surface, underground, radiation experts, and given the profile of the project and the culture that NexGen is exhibiting. We're very, very pleased with the calibre of the applicants that we're receiving, not just within Saskatoon and Saskatchewan but also from outside of Saskatchewan.
Speaker Change #114: The construction.
Speaker Change #114: Of the project that exhibits in geology.
Speaker Change #110: The financial side commercial side everything so we have been very very.
Speaker Change #115: Strategic and well planned in acquiring.
Speaker Change #115: The personnel and the technical expertise that we want.
Speaker Change #115: Since 2017, we knew at that stage, we had a project and we're taking it forward into production.
Speaker Change #115: That's elevated as we speak.
Speaker Change #121: And to give you. One example, like on the safety side of things, we're now breaking that out into very specific areas of safety at surface underground radiation expense.
Speaker Change #121: And given the profile of the project.
Speaker Change #121: And the culture that nexgen is exhibiting.
Nexgen: We're very very pleased with the caliber of the applicants that where we're saving not just within Saskatoon and Saskatchewan, but also from outside of Saskatchewan and so you see.
Leigh Robert Curyer: And so Saskatchewan is going to be experiencing an inflow of skilled labor as a consequence. With respect to the labor force on the ground, well, our community team, led by Adam Engle and Dylan Smart in Saskatoon, have already been running training programs with the various government technical colleges in Saskatchewan, and the take-up of those training programs has been absolutely phenomenal, so we are, you know, well prepared on both fronts, and it exhibits our commitment to making as many of the jobs as local as achievable, and so you're going to also be Thank you very much.
Nexgen: Saskatchewan is going to be experiencing an employee calls of skilled labor.
Nexgen: Labor.
Nexgen: As a consequence with respect to the labor force on the ground well.
Speaker Change #115: Community team led by Adam angle, and Dylan Smart in in Saskatoon.
Adam Angle: Have already been running training programs with the various government technical colleges in Saskatchewan.
Speaker Change #122: And the take up of those training programs has been absolutely phenomenal and we are well prepared on both.
Speaker Change #122: Friends and it exhibits our commitment to making.
Speaker Change #122: As many of the jobs as local as as achievable and say you're going to also be saying in the inflow of population into the local community area.
Adam Angle: The commencement of construction of the project.
Speaker Change #248: Appreciate all of that thank you very much.
Andrew D. Wong: Thank you Andrew.
Julie: Thank you, Andrew. Your next question comes from Puneet Singh from Haight Capital. Please go ahead. Hi, good morning.
Speaker Change #245: Your next question comes from Tony <unk> from H capital. Please go ahead.
Puneet Singh: Just a couple questions on the convertible. Just regarding strategy, you know, the way that uranium prices have traded, why not do this a couple years ago? And what specifically were you seeing in the market that made you pull the trigger now? Yeah, look, you're quite right.
Tony <unk>: Hi, good morning.
Tony <unk>: A couple of questions on the convertible.
Tony <unk>: Just regarding strategy.
Tony <unk>: The way that uranium prices traded why not do this a couple of years ago, and what specifically were you seeing.
Tony <unk>: In the market that made you pull the trigger now.
Leigh Robert Curyer: We've always been confident that the price of uranium is going higher, even, you know, five years ago, and it's going to go higher still. But the decision to purchase pounds of uranium now is completely in line with our stage of development. We're about to, in the final stages of federal approval, we're immediately on the receiving approval to start construction, and the contracting cycle for 2028 and beyond is now, and so that is predicated given the fragility around current production and available supplies, like the producers have had a significant drawdown of inventory on hand over the last two years, and then also the spot market is incredibly tight, and dealing with the nuclear fuel, the utilities want a And so, the timing of that is evident today, and I would say the Russian ban introduced last night has elevated it significantly into a new era that is unprecedented, frankly. Yeah, hey Puneet, it's Travis here.
Speaker Change #123: Yes, you're quite right, we have always been confident that the price of uranium.
Speaker Change #123: Is he is going higher even.
Speaker Change #123: Five years ago.
Speaker Change #123: And and it's going to go higher but the decision to purchase.
Speaker Change #123: Pounds of uranium now is completely in line with our stage of development.
Speaker Change #123: Development, we're about in the.
Speaker Change #123: Final stages, all federal approval will mainly on receiving approval to start construction.
Speaker Change #123: And the contracting cycle for 2028 and beyond.
Speaker Change #123: He is now and say that critic predicated.
Speaker Change #128: Given the fragility around.
Speaker Change #125: Current production and available supplies.
Speaker Change #125: Juices have had a significant drawdown of inventory on hand over the last two years.
Speaker Change #125: And then also the spot market is incredibly types.
Speaker Change #125: Dealing with the nuclear fuel.
Speaker Change #125: Utilities want authority all delivery sorry.
Speaker Change #127: Us acquiring.
Speaker Change #126: $2 7 million pounds.
Speaker Change #126: Is very significant in our contract negotiations with utility and recognizes the utilities risks around security of supply.
Speaker Change #123: So.
Russian band: The timing of that is is evident today and I would say the Russian band.
Russian band: Introduced last knot has elevated that significantly into a new area era.
Russian band: That.
Russian band: Is unprecedented frankly.
Travis G. McPherson: I would also just add that, yeah, with respect to the timing, like, you know, 3, 4, 2 years ago, we weren't at the point of these negotiations with the utilities. We're there now, and to Leigh's point, you know, the world that the utilities live in is, it's 2028 tomorrow. And so that's where the decision to, in terms of the exact timing, it's not a While we're extremely bullish on the uranium price, obviously, for all the reasons and more that Leigh has outlined in the opening remarks, it wasn't purchased on the basis that, you know, we're speculating on the uranium price. It's really tied to the development of the Arrow project as it Okay, I got it.
Tony <unk>: Yes.
Speaker Change #276: Her name is Travis here.
Speaker Change #262: Also just add that with respect to the timing like.
Tony <unk>: 342 years ago, even we werent at the point of these negotiations with the utilities are there now and <unk> point.
Tony <unk>: World that the utilities live in its 2028 tomorrow and so those.
Speaker Change #265: That's where the decision to in terms of the exact timing, it's not a while we're extremely bullish on the uranium price obviously for for all these reasons and more of that Lee has outlined.
Speaker Change #250: In the opening remarks, it wasn't purchased on the basis that we're speculating on the uranium price, it's really tied to the development of the Arrow project as it relates to contracting, which obviously feeds into the debt financing disc.
Tony <unk>: The discussions that we're having as well.
Leigh Robert Curyer: And then just building on that, then if it's tied to the utilities, should we expect more purchases from you guys? Or how should we look at that in terms of strategic contracts versus physical inventory? Yeah, look, what you're not going to see is like, materially fill, obviously, the production volumes that are coming out of Arrow.
Speaker Change #255: Okay got it and then.
Speaker Change #268: Just building on that then if it's tied to the utilities would we should we.
Speaker Change #256: Specced more purchases from you guys or how should we look at that in terms of a strategy contracts versus physical inventory.
Speaker Change #287: Yes look you are not going to see is like.
Speaker Change #262: Materially fell obviously the production volumes that are coming out of arrow.
Leigh Robert Curyer: And, you know, those contracts that we do sign will be filled predominantly by Arrow's production, the vast, vast majority of this, again, to Leigh's point, these 2.7 million pounds, and whether it grows from here or not, to be determined. But I think we're very happy with 2.7 million pounds that we got, because it does just provide a bit of an insurance policy to the utilities. And again, really, I think demonstrates that the understanding of the supply challenges, meaning the available insurance that exists out in the market is very limited, and Wallace's.
Tony <unk>: And.
Lee: Those contracts that we do sign will be filled predominantly by arrows production vast vast majority of it again to Lee's point, these $2 7 million pounds and whether it grows from here or not to be determined.
Speaker Change #252: I think we're very happy with $2 7 million pounds that we got.
Speaker Change #252: Because it does just provide a bit of an insurance policy to to the utilities and again really I think demonstrates that the understanding of the supply challenges meeting the available insurance that exists out in the market is very limited.
Tony <unk>: And we're all set.
Tony <unk>: <unk>.
Tony <unk>: Okay.
Leigh Robert Curyer: It is very, very unique to the nuclear fuel market in respect to mining. It is a necessity of a start-up operation, but it's not unique when you would have seen other developers do a similar thing as they approach production. BOSS Energy has done it, Denison has done it as well, so it's not unique in that sense, and it does reflect the aspect of commencing a uranium mine. It really does reflect that we are taking this project into production. Your next question comes from Katie Lachapelle from the Canaccord Junior League. Please go ahead. Thanks for taking my question. I have two, but I just want to quickly follow up on Puneet's question.
Tony <unk>: It is very very unique to the nuclear fuel market in respect to mining it is a necessity.
Speaker Change #254: Necessity of the startup operation.
Speaker Change #285: But it's not unique.
Tony <unk>: When you.
Speaker Change #144: When you when you would've saying other developers.
Speaker Change #144: Do a similar thing as they approach.
Speaker Change #144: Production plus energy had done it denison they've done that as well so it is not.
Speaker Change #144: Unique in that sense and it does reflect.
Speaker Change #144: The the aspect of <unk>.
Speaker Change #144: Commencing a uranium month.
Speaker Change #257: Okay got it thanks Leandra.
Speaker Change #259: It really does reflect we are tightening this project into production.
Tony <unk>: Okay great.
Tony <unk>: Okay.
Speaker Change #260: Your next question comes from Kt less Chapelle from Canaccord Genuity. Please go ahead.
Speaker Change #267: Hey, guys. Thanks for taking my question I'll ask you, but I just wanted to quickly follow up on <unk> question with respect to the contract negotiations that you're having right now what sort of volumes or tenure or would you be looking to lock down.
Speaker Change #260: When you are looking to sign contracts.
Julie: With respect to the contract negotiations that you're having right now, what sort of volumes or tenor would you be looking to lock down when you are looking to sign contracts? Well, I'll start with the question and hand it over to Travis. We are in current negotiations with four main utilities at the moment, all to different degrees. We've been very, very clear that we are looking for three-year off-take arrangements that are tied specifically to market prices at the time of delivery. Volume levels at the moment are commercially sensitive, but given the supply and demand gap that all market commentators are saying for 2028 and beyond.
Speaker Change #261: Well I'll start with your question and then hand over to.
Speaker Change #262: Travis we are current negotiations.
Travis: With the full nine utilities at the moment all bearing degrees.
Travis: I'm very very clear.
Travis: We are looking.
Travis: For three year.
Tony <unk>:
Speaker Change #312: I'll type arrangements.
Tony <unk>: Ed.
Tony <unk>: Specifically to market prices at the time of delivery.
Speaker Change #133: Volume levels at the moment are commercially sensitive.
Speaker Change #133: But given the supply and demand gap that all market commentators are saying 2020 and beyond and I'll say this morning that I missed.
Katie Lachapelle: And I see this morning that an Australian bank came out with a $150 uranium price forecast for the year-end 2025. I've got no doubt that we're going to be filling contracts to the tune of what Arrow is capable of producing annually. Yeah, I might just add, yeah, there, you know, the, there's no urgency.
Ed: <unk> bank came out with <unk>.
Ed: <unk> 50 dollar you're writing profitable costs for the year end 2025.
I: I've got no doubt that we're going to be filling.
I: Contracts.
I: To the tune of Av.
AV: What arrows capable of reducing annually.
Travis G. McPherson: We need to sign some contracts, or it's optimal to sign some contracts, you know, in this kind of timeframe that we're in now, in terms of the specific volume, say, day one, when we look out, you know, for the foreseeable, say, three to five years of ARROWS production. I mean, to the extent we take on and finance it with debt, which we're, again, going down that path right now, there'll be a minimum level.
Speaker Change #134: Yes, I might just add.
Speaker Change #269: Yes, they are.
Speaker Change #134: There is no urgency.
Speaker Change #134: We need to sign some contracts or its optimal to sign some contracts.
Speaker Change #134: Yes.
Speaker Change #134: In this kind of timeframe that we're in now.
Speaker Change #327: Terms of the specific volume say day, one when we look out.
Speaker Change #329: For the foreseeable say three to five years of arrows production.
Travis G. McPherson: I think, you know, in order of magnitude, it's minimal in the context of ARROWS' overall production to shore up the cash flows necessary to make those debt service payments and make it comfortable for utilities or the lenders. And then, as we progress from, you know, today onwards, I think you'll just see contracts and offtake negotiations and deals get done progressively as we, you know, march from today through to the ultimate startup of production. I got it. That's super helpful.
Speaker Change #313: To the extent, we take on and finance it with the debt, which we're again going down that path right now there'll be a minimum level I think in order of magnitude. It's minimal in the context of arrows overall production to to shore up the cash flows necessary to make those debt service payments and make it comfortable.
Speaker Change #134: For utilities.
Speaker Change #132: Are the lenders.
Speaker Change #131: And then as we progressed from today onwards, I think youll just see contracts.
Speaker Change #131: And offtake negotiations and deals get done progressed.
Speaker Change #131: Progressively as we March from today through to ultimate startup of production.
Katie Lachapelle: Maybe just one other question. In the prepared remarks, you mentioned that you guys are going to provide updated capital as well as operating costs around the end of this quarter or early Q3. Can you provide any detail on where you guys are seeing some of the largest impacts on the cost side? Yeah, I'll start and, again, hand over to Travis.
Speaker Change #131: Got it that's super helpful. Maybe just one other question in the prepared remarks, you mentioned that you guys are going to provide updated capital as well as the operating costs around the end of this quarter or early Q3.
Speaker Change #156: Can you provide any detail on where you guys are seeing some of the largest impacts on the cost side.
Leigh Robert Curyer: But on the cost side, and as I explained in an earlier call, the inflationary impact on the 1.3 billion Canadians as estimated in the 2021 feasibility study to date is at around $320 million. Labor wages are probably the biggest one out of everything on a weighted basis. We are also experiencing some decreases in raw materials as well. The biggest cost component of the construction is the two shafts, and we'll be entering into a contract which limits... Subsequent inflationary pressure on the construction of both the production and exhaust shafts.
Speaker Change #156: Yes, I'll start and again hand over to Travis, but on the cost side and as I explained in the earlier call the inflationary impact.
Travis: On the 1.3 billion Canadian that is estimated in the 2021 feasibility study to do.
Speaker Change #156: Is it around 320.
Speaker Change #135: <unk> million dollars.
I: Labor.
Travis: Wages has been yes.
Speaker Change #154: Probably the biggest one.
Speaker Change #145: Out of everything on a on a weighted basis.
Speaker Change #155: But we're also experiencing.
Speaker Change #155: Some decreases in raw materials as well.
I: The biggest cost component of the construction.
I: Is the two shops.
Speaker Change #311: And we'll be entering into.
Speaker Change #328: Our contract which limits.
Speaker Change #139: Subsequent inflationary pressure on the <unk>.
Speaker Change #141: Construction of both the production of exhaust chefs, but to answer your question Katy is predominantly around.
Travis G. McPherson: But to answer your question, Katie, it's predominantly around labour. Yeah, yeah. And I think, you know, just on the inflationary thing, I think it's important as well, that that is, is not some kind of, that is not calculated based on some kind of, you know, market indice like we went, unit cost by unit cost comparison from the feasibility site to today to make sure that we understand exactly what that is and then the remaining aspects over and above the inflationary impacts are being finalized now through some ongoing test work and and finalization there.
Speaker Change #153: Hey, Bob.
Speaker Change #146: Yes, yes, and I think just on the inflationary thing I think it's important as well, but that is not some kind of.
Speaker Change #136: It's not calculated based on some kind of market indices like we went.
Speaker Change #136: Unit costs by unit cost comparison from the feasibility study to today to make sure that we understand exactly what that is and then the remaining aspects.
Speaker Change #152: Over and above the inflationary impacts are being finalized.
Speaker Change #152: Now through <unk>.
Speaker Change #174: Some ongoing test work and Finalization.
Speaker Change #136: There.
Travis G. McPherson: With respect to, you know, the just we've got under just just shy of a billion dollars Canadian in the Treasury now, and with the debt process over, you know, expressions of interest over 1.4 billion US, we have got more than enough capacity with respect to even taking into account the impact of inflation on the feasibility study. We are very, very well financed in order to execute this project with our current, [inaudible] and Liquid Assets, including the debt expression of interest. Awesome. Thank you, guys. I appreciate the details. Thank you, Katie.
Speaker Change #157: With respect to say.
Speaker Change #157: Yes.
Speaker Change #136: Just under just just shy of the $1 billion Canadian in.
Speaker Change #138: In the Treasury now and with the debt process that.
Speaker Change #138: The expressions of interest side, the $1 4 billion U S.
Speaker Change #143: We have got more than enough capacity with respect to even taking into account the impact of inflation.
Speaker Change #137: Onto the feasibility study.
Speaker Change #137: Very very well.
Speaker Change #137: Next in order to execute this project with that comment.
Speaker Change #137:
Speaker Change #314: Cash and liquid assets, including that expression.
Speaker Change #149: Expression of interest.
Speaker Change #140: Awesome. Thank you guys I appreciate the detailed response.
Speaker Change #161: Thank you Eddie.
Julie: Your next question comes from Craig Hutchison from TD Cohen. Please go ahead. Hey, good morning, guys. Just a follow-up question regarding the timing of the purchases that you did, like, from my perspective, I thought, you know, your tier one assets, your one jurisdiction, that you guys would be in the driver's seat with regard to offtake discussions and that you would not have to enter into purchase agreements now. Um, can you just talk about those discussions? Are you seeing the utilities not that rushed right now to enter into contracts? Are they, are they not short, short material?
Speaker Change #161: Your next question comes from Craig Jetson from TD Cowen. Please go ahead.
Craig Hutchison: Hey, good morning, guys.
Craig Hutchison: Just a follow up question regarding the timing of the purchases that you did like.
Craig Hutchison: From my perspective, I thought your tier one assets tier one jurisdiction that you guys would be the driver's seat with regards to offtake discussions and that you would not have to enter into purchase agreements now.
Speaker Change #151: Can you just talk to those discussions or are you seeing in the utilities not that rush right now to enter into contracts are they are they not sharp sharp material.
Speaker Change #151: Just some sense on that because I think in previous discussions you guys had talked about potential to do.
Speaker Change #158: Even like a forward sale of uranium.
Craig Hutchison: Just some sense on that because, in previous discussions, you guys have talked about the potential to do, even like a forward sale of uranium. Yes. So Craig, and good morning.
Speaker Change #158: Yes.
Speaker Change #159: Let say Greg that in.
Speaker Change #147: Good morning.
Leigh Robert Curyer: The, in terms of box C, well, we're working with the utilities to get contracts in place and arrangements in place which meet a win-win. So, it's not like we're going to flex our muscles and have a win-loss situation. We are developing relationships with these key utilities for the long term, and that uranium purchase reflected our understanding. [inaudible] Yes, there is a possibility of a forward sale of a contract. But that may not necessarily be with a utility.
Speaker Change #140: The.
Speaker Change #160: In terms of that description bulk sale well with working with the utilities to get contracts in place and arrangements in place, which may win wins.
Speaker Change #160: So its not like were.
Speaker Change #140: Going to flex our muscles and have our win loss situation. We are developing relationships with these utilities for the long term and that uranium purchase reflected.
Speaker Change #148: Us and understanding.
Speaker Change #140: The sensitivities around startup operation, which exist for any startup operation and as were saying Denison and Bosch et cetera have done a similar thing which is very very astute and reflects our understanding of the contracting.
Speaker Change #140: Process there is no doubt.
Speaker Change #140: That the.
Speaker Change #140: Focus on the security of supply is now significantly elevated and elevating week by week with these market developments, we are entering into an unprecedented.
Speaker Change #140: Stage.
Speaker Change #162: Yes, there is a possibility of a forward sale.
Speaker Change #195: All of the contract.
Leigh Robert Curyer: We are receiving expressions of interest from not just utilities but also financial players with respect to that possibility. So our approach is one that understands the utility's specific requirements and one which is about a win-win for both the producer and the utility, taking into account the risks around producing nuclear energy. Yeah, I might just add, Craig, that this is really about optimization and our view of how to do that best. Like, we can get contracts without necessarily having purchased uranium. I mean, that's obviously been done before.
Speaker Change #162: That might not necessarily bay with utility.
Speaker Change #162: Where we're saving expressions of interest from not just utilities, but also.
Speaker Change #140: Financial plays with respect to.
Speaker Change #140: That possibility.
Speaker Change #140: So our approach is one that is understanding the utilities.
Speaker Change #140: Specific requirements.
Speaker Change #168: And one which is about.
Unknown Executive: A win win for both the <unk> and utility.
Speaker Change #140: Taking into account.
Speaker Change #171: The risks around producing nuclear energy.
Speaker Change #163: I might just add Greg but.
Speaker Change #163: This is really about optimization and our view of how to do that best.
Speaker Change #170: Got it.
Speaker Change #140: We didn't get contracts without necessarily having purchased uranium I mean, that's obviously been done before but business around.
Travis G. McPherson: But this is around, you know, really, I think the best way of thinking about it is that we're trying to maximize the value of the plus 350 million pounds we have in the ground. And, you know, buying some uranium now, like 2.7 million pounds, to help us potentially optimize what those contracts look like for the sale price of that plus 350 million pounds is a really good and astute move. So, yeah, it's not Look, you're right. And we're all right.
Speaker Change #173: Uh huh.
Speaker Change #179: Really I think the best way of thinking about it is we're trying to maximize the value of the plus 350 million pounds, we're having the ground.
Speaker Change #140: And buying some uranium now by $2 7 million pounds to help us potentially optimize what those contracts look for the sale price of that plus 350 million pounds is a really good and astute moves so.
Speaker Change #172: Yes, it has gone well.
Travis G. McPherson: This asset is what it is, and it represents what it represents in the uranium market, which is unique and of scale and quality. But this is around optimizing that. We're not just sitting back and saying, well, we have the best, so, you know, take it or leave it.
Speaker Change #182: You're right.
Speaker Change #319: We're all right like this asset is what it is and it represents what it represents in the uranium market, which is unique in and of scale and quality.
Speaker Change #182: But this is around optimizing that we're not just sitting back and saying well we have the best so.
Speaker Change #315: Take it or leave it this is about working with the utilities.
Speaker Change #140: Evolving the market overtime.
Leigh Robert Curyer: This is about working with the utilities and evolving the market over time. Okay, thanks for that, guys. And maybe just follow up, just given the expressions of interest you've had on debt and the financing you guys have done the last couple weeks here, you had talked previously about the potential to do project equity with a non-mining partner. Is that still on the table? Or is that sort of off the table, just given the recent financing? No, it's still a possibility, but I would say maybe less so, given the recent findings.
Speaker Change #165: Okay. Thanks for that guys and maybe just follow up just given the expressions of interest you've had on debt and the financing that you guys have done the last couple of weeks here you had talked previously about potential to project equity with a non marni partner is that still on the table or is that sort of off the table just given the recent financings.
Speaker Change #184: It's still.
Speaker Change #165: A possibility.
Speaker Change #169: But yes.
Speaker Change #169: I would say maybe less site.
Speaker Change #140: Given the recent.
Speaker Change #140: And look at.
Travis G. McPherson: I get the commentary about, well, why would you do it now when you've got such a significant, you know, milestone coming up with federal permitting? But similar to the uranium purchase of 2.7 million pounds, having the Treasury in place prior to approval is a necessity to give the CNSC and the federal government of Canada knowledge that we have the funds in place. It's a very important aspect, and so doing it prior to that federal approval news coming through, and obviously subject to concluding the process respectfully.
Speaker Change #175: Yeah, and I get the commentary about well why would you do it now when you've got such a significant.
Speaker Change #164: Milestone coming up with federal permitting.
Speaker Change #140: But similar to the uranium purchase of $2 7 million pounds, having the treasury in place prior to their approval is a necessity.
Speaker Change #140: Give the same assay and the federal government of Canada knowledge that we have the funds in place.
Speaker Change #140: It's a very important aspect in.
Speaker Change #140: And so doing it prior to that federal approval news coming through and obviously subject to concluding the process respectfully.
Leigh Robert Curyer: We now have that in place, and on receiving that approval... well-financed in order to construct the Rook One project, very, very clear. And we appreciate the opportunity to really provide the color behind that, because on face value, as I said, we get, well, you know, it's less dilutionary post a milestone, but this way, we've got it in front of it. And it reflects the practicality of building a mine with regulators but also, you know, gives that significant milestone to the company.
Speaker Change #186: We now have that in place and on receiving that approval well finance in order to construct the rook one project.
Speaker Change #140: Hi.
Speaker Change #166: I think that's.
Speaker Change #167: That's very very clear and we appreciate the opportunity to really provide the color behind that because on face value as I said, we get will.
Speaker Change #140: <unk>.
Speaker Change #140: Post post a milestone, but this way we've got in front of it and it reflects the practicality of building them on with regulators.
Speaker Change #202: But oh sorry.
Speaker Change #140: Is that significant milestone that the companies.
Leigh Robert Curyer: I'm going to deliver on federal approval, absolutely clear air for it to be reflected in the value of the organization at that time, so it's very, very exciting for all shareholders and stakeholders. Yeah, and Craig, just with respect to the joint venture you referenced, and it's true for the debt and everything else, I think all these things are negotiations. When you're in a negotiation, you know, demonstrating that you have other options is really important.
Speaker Change #317: Im going to deliver on on federal approval, absolutely clear air for to be reflected in the value of the organization at that time.
Speaker Change #140: It's a very very exciting grow shareholders and stakeholders.
Speaker Change #140: And Craig just with respect to the joint venture you referenced and it's true for the debt and everything else I think all.
Speaker Change #177: All of these things or negotiate ends up being in a negotiation.
Leigh Robert Curyer: So by having a really robust balance sheet today helps, you know, optimize the debt discussions that we're having because we're not [inaudible] Okay, thanks for that guys. Me just a quick question on the early works, I think your budget was about 46 million at the end of last year. Could you just give us an update kind of where that's at? And then, I think, on the last conference call, you said your budget for this year was around 170 million, excluding expiration. And is that still the case?
Speaker Change #177: Demonstrating that you have other options is really important so.
Speaker Change #177: By having a really robust.
Speaker Change #177: Balance sheet today helps optimize again the debt discussions that we're having because we're not.
Speaker Change #140: It's not.
Speaker Change #140: We're not in a weak position there like we have other options similar with the joint venture discussion like we can then work to actually optimize those Michelle we have other paths and other opportunities to fund it and we do it is true we have watched it shouldnt be surprising anyone there's lots of ways to fund this project.
Speaker Change #140: Under our stewardship.
Speaker Change #190: Okay, great. Thanks for that guys, maybe just a very quick question just on the early works I think your budget, it's been about $46 million to the end of last year could you just give us an update kind of where that's at.
Speaker Change #196: And then I think on the last conference call. You said your budget for this year is around 170, excluding exploration and is that still the case.
Speaker Change #191: Yes, it's subject to the timing of the federal permit.
Speaker Change #140: Yes.
Speaker Change #181: It is.
Speaker Change #199: The deployment of capital will increase significantly on immediately you were saying that federal approval.
Speaker Change #181: Sorry.
Speaker Change #140: We're well under budget frankly.
Speaker Change #140: Frankly for 2024 and incredibly well financed.
Speaker Change #140:
Speaker Change #140: Throw into 2027.
Speaker Change #180: Frankly based on the cash we have on hand at just under 1 billion Canadian.
Speaker Change #180: As we say.
Leigh Robert Curyer: Thanks. Yeah, it's subject to the timing of the federal permit. It's the the deployment of capital will increase significantly on immediately receiving that federal approval. So we're well under budget, frankly, for 2024, and incredibly well financed. [inaudible] through into 2027, frankly, based on the cash we have on hand at just under a billion Canadian dollars as we speak. Alright, thanks guys. Thanks, Craig. Your next question comes from Ores Waukodo from Scotiabank. Please go ahead. Hi, good morning.
Speaker Change #176: Alright, thanks, guys.
Speaker Change #177: Thanks, Greg.
Speaker Change #196: Your next question comes from Rs <unk> from Scotiabank. Please go ahead.
Julie: Two questions if I could. The first one, Leigh, your comments about having financing in place in order to show the government or give the government confidence in your ability to build the project, does that suggest that you plan to confirm all of the debt financing as well prior to the government approving it? Yeah, prior to or just after the federal government allows the debt, you know, the way it works is that the equity has to be spent first. So, um... It's not a... At the moment, we are working on the debt, but the debt is subject to federal permitting approval and getting into construction after you have spent the equity. So, um...
Speaker Change #183: Hi, good morning, two questions if I could the first one liter comments about having financing in place in order to show the government.
Speaker Change #207: It gives us confidence in your ability to build the project does that suggest that you plan to confirm all of the debt financing as well prior to permitting.
Speaker Change #185: Yes, prior or just at the federal permitting the debt the way. It works is that the equity has to be spent first.
Speaker Change #183: So.
Speaker Change #177: It's not a.
Speaker Change #177: Given that we will arrange that prior to federal permitting or just after we're working on it now but the debt is obviously subject to federal.
Speaker Change #177: Permitting approval and getting into construction and after you've spent the equity.
Speaker Change #177: So.
Ores Waukodo: I wouldn't say it's contingent on it, but it's functional. Okay, and then alternatively, just on the inventory and the purchase of physical goods, I think that surprised pretty much all of us in terms of that transaction. Your comments about you could add more are there, like when I look at what Cameco carries from an inventory perspective of 10 to 12 million pounds, that's about a third of their annual sales. Is that ultimately where you think you might have to get to in terms of volume on hand in terms of being able to sign offtake agreements down the road? No, look, they're completely different operations with completely different technical risks. So, as you're aware, Cameco's mines are in the sandstone, which requires freezing in order to keep the cavities open. We're in the hard rock genre.
Speaker Change #177: I wouldn't say, it's contingent on it but it's a function of it.
Speaker Change #198: Okay and then.
Speaker Change #198: Alternatively, just on the inventory and the purchase of physical I think that surprised pretty much all of us in terms of that transaction.
Speaker Change #177: Your comments about you cut out or is there like what I look at what cameco carries from a regulatory perspective 10 to 12 million pounds. That's about a third of their annual sales is that ultimately where you think you might have to get to in terms of.
Speaker Change #177: Volume on hand in terms of.
Speaker Change #188: Being able to sign offtake agreements down the road.
Speaker Change #192: No look they are completely different operations with completely different technical risks.
Speaker Change #187: As you're aware chemicals minds are in.
Speaker Change #189: The Samsung caused phrasing noted Kate the cavities open we're in the hard rock.
Leigh Robert Curyer: We drill a cavity into the hard rock, and it'll be open for a thousand years. So we have the flexibility to ramp production up and ramp production relative to market conditions at that time. We can afford having a far lower level of inventory on hand at any particular time, but during commissioning, having 2.7 million pounds on hand is very, very astute. It is a quantity which we have targeted and have acquired, with a very sound technical and economic basis behind it to help launch the company into production at that time.
Speaker Change #187: We drill a cavity into the hydraulic Canada will be opened for a thousand years say.
Speaker Change #187: We had the flexibility to ramp production up and ramp production.
Speaker Change #187: Relative to market conditions at that time.
Speaker Change #187: We can afford having.
Speaker Change #187: Lower level of inventory on hand at any particular time, but during commissioning having $2 7 million pounds on hand is very very steep so.
Speaker Change #187:
Speaker Change #200: It is.
Speaker Change #187: Quantity, which we had targeted.
Speaker Change #187: And have acquired.
Speaker Change #209: Yes very.
Speaker Change #187: Very sound technical and economic basis behind it G to help.
Speaker Change #187: Help launch the company into production at that time.
Leigh Robert Curyer: So, you know, Cameco's inventory, you know, up until a couple of years ago, was always over 30 million pounds, representing the entire year's production. I think that just goes to show the availability of supplies and fragility of supply of mine supply is very, very high at the moment, and so. I think it may have surprised people.
Speaker Change #187: Yes.
Speaker Change #187: Kevin.
Speaker Change #187: Inventory up until a couple of years ago was always over 30 million pounds representing.
Speaker Change #193: And Todd Yes.
Speaker Change #193: Production.
Speaker Change #205: I think that just goes to show the availability of supplies and fragility of supply is a month's supply is very very high at the moment and our site.
Speaker Change #193: I think the wall Street might have surprised people.
Leigh Robert Curyer: It is a function of a company going into production. I think in light of the market circumstances, which we have read very, very accurately since 2011, the astute nature and timing of that purchase will materialize in the near future. So two things, I definitely wouldn't read any parallels or correlations between, you know, the percent of anyone else's production profile and how much inventory they hold and draw a correlation to, therefore, how much we need to hold or anything. As I said, we don't need to have any pounds to get a contract. It's not like they're; it's a requirement to get a contract.
Speaker Change #194: It is a function of the of the company going into production I think in light of the market circumstances.
Speaker Change #194: Which we have read very very accurately since 2011.
Speaker Change #194: The the street nature and timing of that that purchase will materialize.
Speaker Change #194: In the in the near future yes.
Speaker Change #203: <unk> did not.
Speaker Change #225: So two things I wonder if it definitely wouldn't read.
Speaker Change #194: Any parallels or correlations between the percent of anyone else's production profile and how much inventory, they're holding dropped correlation to therefore, how much we need to hold or anything as I said, we don't need to have any pounds to get a contract. It's not like it's a requirement to get a contract it's about optimizing what.
Travis G. McPherson: It's about optimizing what those contracts look like, and we feel very comfortable with, again, this insurance policy, the amount that we have now to provide that to, therefore, optimize and maximize the value that those contracts that we do sign now represent, you know, again, all the pounds that we have. But I guess this 2.7 million pounds really makes a difference at the end of the day, given it's, call it 10% of your annual sales. Is that sufficient to actually move the needle with respect to giving utilities confidence? Yes. Yeah, because the concern is not around once you're wrapped up.
Speaker Change #194: Those contracts look like and we feel very comfortable with again this insurance policy would the amount that we have now.
Speaker Change #194: To provide that to therefore optimize.
Speaker Change #194: And maximize the value that those contracts that we do sign now.
Speaker Change #213: <unk> represents again, the all the bonds that we have in the ground.
Speaker Change #201: But I guess, there's 2.7 million pounds really make a difference at the end of the day given its call. It 10% of your annual sales is that sufficient to actually move the needle with respect to giving utilities confidence.
Speaker Change #201: Yes.
Speaker Change #201: Yes, because the concern is not around once you ramped up the.
Travis G. McPherson: Look, we're very confident in our ability to ramp up our minds. This isn't about our view on, you know, production, startup risks, or anything. This is just a perception that utilities could have or have around any new mind starting up that there are risks associated with that. And so having 2.7 million pounds, just again, it's an insurance policy, like an insurance policy; you don't buy that and cover all the value of whatever you're insuring.
Speaker Change #224: Look we're very confident in our ability to ramp up our mined this isn't about.
Speaker Change #201: Our.
Speaker Change #201: Our view on.
Speaker Change #201: Startup risks or anything this is just a perception that utilities could have or have around any new mines, starting up that there are risks associated with that and so having $2 7 million pounds. Just again, it's an insurance policy life insurance policy.
Travis G. McPherson: This is about just that small window of time, say three to six months when the mine's ramping up for the first bit, and just providing a bit of insurance around that to, therefore, again optimize the value of these contracts. Thank you very much. Your next question comes from Graham Tanaka from Tanaka Capital Management. Please go ahead.
Speaker Change #201: By that and cover all of the value of whatever you're ensuring this is about just that small window of time three to six months. When the mine is ramping up for the first bit and just providing a bit of insurance around that to therefore again optimize the value of these contracts.
Speaker Change #230: Okay. Thank you very much.
Speaker Change #215: Your next question comes from Graham Tanaka Tanaka Capital Management. Please go ahead.
Julie: Yeah, yes, thank you. So, trying to tie this all together, the establishment of inventory, I understand, is to help you stage, create an inventory in hand, and allow you to negotiate on stronger terms with utilities with greater confidence with inventory in hand, even as you're starting up the mines. So I'm trying to understand what your timing was on purchasing at current prices and financing it with quasi-equity with a convertible.
Graham Yoshio Tanaka: Yes. Thank you. So just wanted to understand so trying to tie this all together the establishing of inventory I understand is to help you stage create.
Speaker Change #210: Create an inventory in hand.
Speaker Change #216: Allow you to negotiate on stronger terms with utilities with greater confidence with the inventory and even as you're starting up the minds.
Speaker Change #201: So.
Speaker Change #220: Trying to understand what your timing was on purchasing at current prices and and the financing it with.
Julie: What were your alternatives? You could have waited. You could still wait and do this a year from now, or you could have done it a year ago. I'm just curious about your timing and what the current price and your outlook for prices in the future had to do with your timing. Thank you.
Speaker Change #218: Quasi equity with a convertible.
Speaker Change #222: What are your alternatives you could have waited you could still wait and do this a year from now.
Speaker Change #204: Could have done it a year ago I'm, just curious about your timing and what the current price and your outlook for prices in the future has to do with your timing. Thank you.
Graham Yoshio Tanaka: Thanks, Graham. As in the call, this specifically relates to the fact that the contracting cycle for 2028 and beyond is now. That that is what the utilities are focused on. And so when you're having those discussions for offtake in 2020 and beyond, it's relevant to buy the pounds now, so yes, we could have bought it earlier if we were just making a trade because we're always very confident the uranium price is going to be a lot higher, and we think it's going significantly higher in the future.
Speaker Change #205: Sure. Thanks, Thanks Graham.
Speaker Change #208: As in the coal it specifically relates to the fact that the contracting cycle for 2020 and beyond is now.
Speaker Change #205: That is what the utility.
Speaker Change #205: Our focused on than say when you're having those discussions for offtake in 2020 and beyond.
Speaker Change #220: It's it's relevant to buy the pounds now so yes, we could have bought it earlier, if we were just making a trade because we're always very confident.
Speaker Change #205: Uranium price.
Speaker Change #205: What's going a lot higher and we think it's going at a significantly higher.
Speaker Change #201:
Graham Yoshio Tanaka: At $92.50 it was at the time we bought it $93.85 on the spot market hundred thousand pound purchases over the last six months has resulted in at times greater than a dollar fifty increase in the spot price so if we bought those 2.7 million pounds on the spot market the price probably would have got driven up to over a hundred and twenty dollars a pound US based on those past transactions over the last at www.nexgen.com.au to our five-day VWAP, you know, only $14.80 Canadian, so, you know, incredibly Good use of an instrument which is on the identical terms to the one we've done with CEF very successfully, QRC very successfully, and more recently with Sol Patterson's out of Australia, we're very, It's not like your typical convertible, it's a bit of a hybrid that we developed with Warren Gilman, and it works very very well for us and has worked very very well in the past and when it comes with voting alignment and and it's with one party. We know exactly what we're dealing with, and it wasn't a drain on the current cash balance. The other aspect too, like we're very, very cost conscious. We avoided the broker fee of $10 million US in implementing that convertible as well.
Speaker Change #201: In the future $92 50.
Speaker Change #217: It was at the time, we bought at 93 five on the spot market.
Speaker Change #217: 100000 pounds purchases over the last six months has resulted in at times greater than a $1 50 increase in the spot price.
Speaker Change #217: We bought those $3 7 million pounds on the spot market the price probably would've driven up to over $120.
Speaker Change #217: A pound U S based on those Pos transactions over the last.
Speaker Change #201: Six months, so with bolt them extremely S.
Speaker Change #201: <unk> with respect to the financing of it in issuing a convertible debenture it was at a 30% premium.
Speaker Change #201: Two out five day they whack.
Speaker Change #201: Late $14 Canadian.
Speaker Change #201: So incredibly.
Speaker Change #201: Good use of an instrument, which is on identical terms to the one with them, we say very successfully to us a very successfully and more recently with soap medicines out of Australia, we're very.
Speaker Change #201: It's not like your typical convertible it's bit of a hybrid that we developed with the with Warren Gilman.
Speaker Change #201: It works very very well for us and has worked very very well in the past.
Speaker Change #212: When it comes with voting alignment and <unk>.
Speaker Change #211: One party.
Speaker Change #225: Exactly what we're dealing with.
Speaker Change #211: And.
Speaker Change #211: And it wasn't a drain on the current.
Speaker Change #211: Cash.
Speaker Change #211: Balance.
Leigh Robert Curyer: So it's a very successful transaction, and it was actually, whilst it was a 30 day, a 30% premium to our 5 day VWAP at the time, it was also a 33% premium to the raise we did in Australia only 7 days beforehand. So that speaks for itself in terms of the strength of that financing. I understand, and thank you very much for that explanation.
Speaker Change #211: The other aspect to it but we're very very cost conscious.
Speaker Change #211: We avoided the broker sales of $10 billion U S in implementing that convertible as well say.
Speaker Change #211:
Speaker Change #211: It's a very successful transaction and it's actually well sort of the 30 day.
Speaker Change #214: A 30% premium to al.
Speaker Change #214: Five <unk> at the time. It was also a 33% premium to the raise we did in Australia, only seven days before hand.
Speaker Change #214: That speaks for itself in terms of.
Speaker Change #214: The strength of that financing.
Leigh Robert Curyer: I'm just curious what the potential is for future equity raises. Should you deem the market attractive relative to what your needs might be for future expansion, whether it be for exploration? Say one or two of your other Patterson Corridor or other opportunities become very ripe for development. I hope I'm not getting too far ahead of myself here, but what could be your additional capital requirements going forward? Or is this enough now to take you through full production as well as continuing exploration? Thank you. This cash balance of just under cash and inventory just under a billion dollars Canadian plus with the debt expressions of interest, I think speaks for itself.
Speaker Change #214: Well.
Speaker Change #228: I understand and thank you very much for that explanation just curious.
Speaker Change #229: What the potential is for future equity raises should you deem the market attractive.
Speaker Change #229: Relative to what your needs might be on future expansion, whether it be for exploration.
Speaker Change #214: One or two of your other patterson quarter or are there other opportunities.
Speaker Change #239: Become very ripe for development.
Speaker Change #239: I hope I'm not getting too far ahead of myself here, but what could be your additional capital requirements going forward or is this enough now to take you through the full production as well as continuing exploration. Thank you.
Speaker Change #233: This cash.
Speaker Change #232: Cash balance of just under a passion and inventory just under $1 billion Canadian plus with the expressions of interest.
Leigh Robert Curyer: It's far in excess of the capex that we need to take Group 1 into production and receive the federal permit. This new discovery would be a completely exclusive aspect, which we're still in the very early days of understanding. It would be amazing, frankly, to have another arrow in our hand, and if we do so, and if that's what eventuates, we'll navigate that financing accordingly, I think. Whilst that may have shocked some investors, the close proximity of both of them, I hope today has explained the rationale behind it, which reflects a company that is taking a mine into production.
Speaker Change #234: I think speaks for itself that is far in excess of the capex that we need to take grew quite into production, we're saving the federal permit.
Speaker Change #223: This new discovery would be yes.
Speaker Change #214: Completely exclusive.
Speaker Change #214: Aspect, which was still in the very early days of understanding.
Speaker Change #214: It would be amazing frankly.
Speaker Change #214: To have another arrow on our hands.
Speaker Change #214: And he is doing site and.
Speaker Change #243: If that's what a bench whites will will navigate that financing accordingly, I think.
Speaker Change #214: Yes.
Speaker Change #227: That might have shocked some in <unk>.
Speaker Change #227: Investors the close proximity of Av.
Speaker Change #227: Both of them I hope today has explained the rationale behind it which reflects a company which ceased taking them on.
Speaker Change #227: In into production.
Leigh Robert Curyer: I've just asked everyone to look at our history of financing along the way. We've done it in the least diluted manner every time, in a very cost-efficient manner every time, in the context of the market, with very small discounts.
Speaker Change #227: Just ask everyone to look at our history of financing.
Speaker Change #227: Along the way we've done it in the most least dilutive manner every time at a very cost efficient manner.
Speaker Change #227: Every time in the context of the market very small discounts.
Leigh Robert Curyer: We've done it in the most cost-efficient manner every time, in the context of the market, at the spot share price at the time or at 30% premiums through the use of convertible instruments. And whenever we do raise money and if we do have another arrow in our hands, it'll be the same discipline and approach that we've always exhibited. But to, So in the short term, yeah, we are very, very well covered between what we have on hand plus the debt that we're working on to more than adequately get Arrow into production.
Speaker Change #227: To the share price at the time or at that you've sent premiums.
Speaker Change #227: Through the use of the convertible and whenever we do raise money in it.
Speaker Change #227: Do you have another arrow in our hands it'll be the same discipline and approach that weibo has exhibited.
Speaker Change #227: But to.
Speaker Change #227: In the in the short term yeah, we are very very well covered between what we have on hand plus the.
Speaker Change #214: <unk>.
Speaker Change #214: That that were working on two more than adequately get.
Speaker Change #236: Arrow into production and Graham if we.
Leigh Robert Curyer: Yeah, and Graham, if we, you know, your world, which is a very exciting world where, you know, this new discovery turns into the other Arrow. You know, what we have in terms of the plans, the CapEx, and all of that to build Arrow will stay what it is. You know, something new that comes along that we discover and looks like it can go into our minds and everything that will likely come into our lives later in the mind life.
Speaker Change #246: Your world, which is a very exciting world.
Speaker Change #214: Sure.
Speaker Change #214: This new discovery turns into the other aero.
Speaker Change #214: What we have in terms of our plan for Capex and all of that to build arrow will stay what it is.
Speaker Change #214:
Speaker Change #214: Something new that comes along that we discover and looks like it can go into our mind everything about it.
Leigh Robert Curyer: So it's not like, you know, say this turns out to be another arrow that I wouldn't think of it or there's no yeah, there's no way I'm thinking of it where, you know, all of a sudden, the capex is, you know, doubled because we made a new discovery or something like that. It really would come in later in the buying life and obviously all the infrastructure built to develop. So the timing of any future exploration in advance of even developing a second or third mine, should you be successful, will come when you are generating surplus cash flows anyway from the Rook One project, correct? Exactly Graham.
Speaker Change #235: Will likely come in later in the mine life, So it's not like.
Speaker Change #242: Sorry, if this turns out to be another railroad.
Speaker Change #235: I wouldn't think of it or there is no there's no way I'm thinking of it where all of a sudden the capex is done.
Speaker Change #235: Because we've got a new discovery or something like that it's really.
Speaker Change #214: Would come in later in the mine life, and obviously all of the infrastructure would be built to develop era.
Speaker Change #214: So you so the timing of any future.
Speaker Change #214: Exploration in advance of even developing a second or a third mine should you be successful.
Speaker Change #249: Will come when you are generating surplus cash flows anyway from the from the Brooklyn project correct.
Greg: Exactly Greg look I think there's the.
Travis G. McPherson: Look, I think there's, you know, the geological evidence suggests we didn't hit the big mother load on the very first drill hole back in 2014. This new discovery would suggest we've got a lot more mineralization on our hands. We've actually got significantly more mineralization at the bottom of Arrow and in and around Arrow that we haven't fully defined on our balance sheet. But 3.5 kilometers away, we'll come in to the, probably most likely come in during the end of the Arrow mine life, and we'll be fully funded from the cash that's generated out of Arrow. So I think your perspective on no future equity requirements is very, very real. That's great.
Greg: The geological evidence suggests.
Greg: We didn't hit the big mother load on the very first drill hall back in 2014.
Speaker Change #214: This new discovery would suggest we've got.
Speaker Change #214: A lot more mineralization on our hands, we've actually got significantly more mineralization at the bottom of arrow.
Speaker Change #214: And in and around <unk>.
Speaker Change #214: Haven't fully define.
Speaker Change #214: Defines.
Speaker Change #214: I'll now on our balance sheet.
Speaker Change #214: But three five kilometers away.
Speaker Change #214: We will come into the probably most slightly coming during the end of the ore mine life will be fully funded from the cash that's generated out of <unk>.
Speaker Change #251: I think your your perspective on.
Speaker Change #214: Not a future equity requirement seeds is very very real.
Graham Yoshio Tanaka: Changing the subject a little bit, I just got some industry feedback that there are some more traditional suppliers in the industry that are not, that confident, let us say that a price for long-term contracts at market prices, quote-unquote, would be unacceptable to many utilities. So I'm just curious, in your discussions with utilities, how many utilities have you had discussions with that are leading to your being confident that you can actually sign multi-year contracts from a new mine that are going to be priced at market? And what is the at market going to be a function of? You know, one or two or three markets, you know, spot market entities or what? How are you going to set that market price?
Speaker Change #244: That's great.
Speaker Change #238: Changing subject a little bit I just get some.
Speaker Change #238: Industry feedback that there were some more traditional.
Speaker Change #238: Suppliers in the industry that are not.
Speaker Change #237: That confidence shall we say that a.
Speaker Change #237: Pricing of long term contracts at.
Speaker Change #237: At market prices quote unquote would be.
Speaker Change #240: Acceptable too many utilities, so I'm just curious in your discussions with utilities, how many utilities have you had discussions with that.
Speaker Change #237: Leading to.
Speaker Change #253: You're being confident that you can actually signed multi year contracts.
Speaker Change #237: From a new mine that debt or it could be priced at market and what is the at market is going to be a function of.
Speaker Change #237: One or two which we market.
Speaker Change #237: No.
Speaker Change #237: Spot market.
Speaker Change #247: Entities or what how are you going to set that marketplace.
Leigh Robert Curyer: Thanks. Yeah, well, Graham, just frankly, you've heard that from other companies in the sector, be it other companies or anonymous people on social media, and only dealing with based on our discussions with utilities. So, you know, everyone's got an opinion.
Greg: Yeah, well, Greg just just frankly, you've heard that from other.
Greg: Companies in this in the safe bet.
Greg: Other companies or anonymous people on on social media.
Greg: Yes.
Greg: And finally dealing with based on discussions with utilities.
Speaker Change #237: Everyone's got an opinion.
Leigh Robert Curyer: It reminds me of Fortescue Metals Group back in the mid-2000s, you know, developing a mind between two majors, a lot of comments about well you can't do this, you can't do that, and analysts saying that they'll lie down on the railway tracks because there'll never be ore coming out from their mine. That happens, and I would just encourage everyone to focus on the actual facts as we present them, and we present the facts in full compliance with the rules and regulations under securities legislation.
Speaker Change #237: It reminds me of.
Speaker Change #237: Fortescue metals group.
Speaker Change #237: In the mid two thousands.
Speaker Change #237: Developing a mine in between two majors.
Speaker Change #237: A lot of comments about well you can't do this you can't do that analysts, saying that though lie down on the railway tracks because there will never be all.
Speaker Change #237: Coming out from from them on.
Speaker Change #237:
Speaker Change #237: That happens.
Speaker Change #237: And I would just encourage everyone.
Speaker Change #241: To focus on the actual facts as we present them.
Speaker Change #241: And we present the effects.
Speaker Change #241: With with full compliance with the rules and regulations under the securities legislation side.
Speaker Change #241:
Leigh Robert Curyer: That is evident, we're aware of it, but we're only going to continue to do so, and I'm telling you what our discussions are indicating, and that is what we're doing. But yeah, every situation is different. Our mind is completely different to whatever existed before.
Speaker Change #241: The.
Speaker Change #241: That is evident.
Speaker Change #241: We're aware of it but we're only going to continue to do in fact and on telling you would add discussions are indicating.
Speaker Change #241: And that is what we're doing but yes every situation is different and mine is completely different whatever has existed before it's going to follow a technical risk.
Leigh Robert Curyer: It's got a far lower technical risk, and hence it provides greater flexibility in terms of contracting, and the contracting will be different. Every mine's contracts reflect its technical risk. We are just leveraging that. If it's not common or hasn't been done in the past, so be it, moving forward into the future. And everyone's aware that the cost of pounds for a utility is such a small percentage of their overall operating costs
Speaker Change #241: And hence a provides greater flexibility in terms of.
Speaker Change #241: Contracting in the contracting will be different every mines contracts reflect this technical risk.
Speaker Change #241: And so have a lull and.
Speaker Change #241: And so we just labor ageing that so if it's not common or hasn't been done in the past.
Speaker Change #241: We are about.
Speaker Change #241: Moving forward into the future.
Speaker Change #241: And everyone's aware that the cost of pounds.
Speaker Change #241:
Speaker Change #241: For our utility is such a small percentage of their overall operating costs. So the ne.
Travis G. McPherson: So the need, and Matt Singh, is less weighted with oil coming from a project such as Ruk-One. Yeah, and Graham, I think there's lots of other future suppliers, which the world needs a lot more, future suppliers coming into production that are also undertaking this type of a strategy, which I think is helpful in moving the market and evolving the uranium market into something that has more transparency and liquidity. I think that's a good thing.
Speaker Change #241: In that sense.
Speaker Change #241: Is.
Speaker Change #241: Is less weighted with the with all coming from.
Speaker Change #241: A project such as requirement.
Graham Yoshio Tanaka: Yes, Graham I think theres lots of other future suppliers, which world needs a lot more future suppliers come into production that are are also undertaking this type of a strategy, which I think it is helpful.
Speaker Change #241: In moving the market evolving the uranium market into something that has more transparency and liquidity I think that's a good thing and.
Travis G. McPherson: And again, for us, I think we've also been clear that we're about maximizing the value of every pound that's produced. And so, you know, that's what we're about. And to us, that means, yeah, understanding our technical risks, understanding our resulting cost profile, which is industry-leading and low. And so we're able to confidently and prudently expose ourselves or stakeholders or shareholders to those optimal outcomes in a rising price environment and, subsequently, be completely protected in a world where uranium prices go down for whatever reason, both because of our cost structure, but also because we will hold supply back then and we So that is what we're targeting, what we're about, and I think it is undeniably in the best interest of all of our shareholders and stakeholders. Just another completely different subject.
Speaker Change #241: Again for US I think we've also been clear that.
Speaker Change #241: We're about maximizing the value of every pound that is produced and so.
Speaker Change #241: That's what we're about.
Speaker Change #241: To us that means yes.
Speaker Change #241: Understanding our technical risks understanding our resulting cost profile, which is industry, leading and low and so we're able to confidently and prudently.
Speaker Change #241: Expose ourselves our stakeholders, our shareholders to those optimal outcomes in a rising price environment and subsequently be completely protected in a world where the uranium prices go down for whatever reason, both because of our cost structure, but also because we will hold supply.
Speaker Change #241: Back then and we have the ability to ramp production up and down very quickly because of the technical settings. So.
Speaker Change #241: That is what we are.
Speaker Change #241: Targeting what we're about and I think undeniably is in the best interest of.
Speaker Change #241: All of our shareholders and stakeholders.
Graham Yoshio Tanaka: The debt financing, what do you anticipate roughly to be the total debt capital raise and what kind of interest rates are you assuming in your projections? You know, we've seen a rise in the yield curve. I'm just curious, you know, you're having discussions with the debt providers already, I'm sure, so I'm just wondering what kind of range that would be and to what extent that might have an influence on profitability going forward. Thanks. Yeah, we currently have US $1.4 billion in debt.
Speaker Change #241: Great.
Speaker Change #282: Just another completely different subject.
Speaker Change #272: The debt financing, what do you envision roughly to be the debt total debt capital raise and what kind of interest rates are you assuming in your projections, we've seen a rise in the yield curve I'm just curious.
Speaker Change #272: Are you having discussions with the debt providers already I'm sure. So I'm, just wondering what kind of range that would be and to what extent that might have an influence on profitability going forward. Thanks.
Speaker Change #270: Yeah. We currently have $1 4 billion in debt expressions of interest the rights that we're experiencing.
Leigh Robert Curyer: Unknown Executive, Brian MacArthur, Leigh Curyer, Travis McPherson, Katie Lachapelle, The debt decision is more driven by the structure, who it is with, and not having excessive penalties for early repayment. So that's our approach and our thinking around it. And so I know that you're talking about debt terms not being long because the cash flows from the mine production will be able to pay off the debt pretty quickly. Correct. Then
Speaker Change #270: Standard commercial rights that you were saying Graham, but yes.
Speaker Change #278: We don't spend an extra dollar then we have to but the interest coupon on the debt considering you'll be over such a short period of time will not be material to the company.
Speaker Change #278: That decision is more driven by the structure.
Speaker Change #273: It is with.
Speaker Change #283: And they are not.
Speaker Change #283: Having excessive penalties for early repayment, so that's our approach and thinking.
Speaker Change #273: <unk>.
Speaker Change #271: And so I know that you were talking about debt terms not being long because the cash flows from the mine production will be able to pay off the debt pretty quickly.
Speaker Change #271: Alright.
Speaker Change #271: Correct.
Speaker Change #271: Yes.
Leigh Robert Curyer: Thank you very much. Good luck. Thank you, Graham. Your next question comes from Fred Berliner, a private investor. Please go ahead. Good morning.
Speaker Change #284: Thank you very much good luck.
Speaker Change #286: Thank you Graham Thanks Graham.
Speaker Change #288: Your next question comes from Fred Berliner Private Investor. Please go ahead.
Fred Berliner: Good morning.
Julie: I am concerned that the whole complexion of the company has changed. You had vast landholdings of uranium, and now you're going into the mining business, which is fraught with cost, fraught with unpleasant surprises, and you are now debt-laden. I don't understand why at this point you would be gambling on the price of uranium when you can just sit there with a product in the ground and watch it rise. So please explain to me how you, I mean, going into the mining business is just so difficult, and for you to cross that divide, you have to have real expertise and experience, and I don't know if you have it. So please enlighten me.
Fred Berliner: I am concerned.
Fred Berliner: The whole complexion of the company has changed you had a.
Speaker Change #279: There's land holding.
Speaker Change #277: Uranium and now youre going into the mining business, which is fraught with cost fraught with unpleasant surprises.
Speaker Change #274: You will know that later.
Speaker Change #275: I don't understand.
Speaker Change #275: Why at this point, we would be gambling on the price of uranium when you can just sit there with a product in the ground and what should rise. So please explain to me how you.
Speaker Change #275: I mean going into the mining business is just so difficult.
Speaker Change #275: And for you.
Speaker Change #279: <unk> that divide you have to have real expertise and experience.
Speaker Change #279: If you got it.
Speaker Change #279: So please enlighten me.
Fred Berliner: Yeah, and good morning, Fred. Look, all are all valid risks of mining. Yeah, mining's not a simple endeavor, but everyone at the company has been in the business from very large mining companies to the smallest. I would say we faced far greater challenges earlier on in our incorporation back in 2011, with actually just trying to find a discovery in the first place than what we have in front of us. You know, when we went out to the other side of the basin, we were laughed at by some of the industry leaders, saying you'll never find economic mineralization out there. Well, we happened to have discovered the largest and most economic and environmentally elite mineralization that exists on the planet. We then got told we'd never get a permit.
Speaker Change #279: Yes.
Speaker Change #275: Fred.
Fred Berliner: Oh valid risks of mining Monty is not.
Speaker Change #275: A.
Speaker Change #274: Simple endeavor, but everyone at the company's vein in in the business from very large mining companies to the smallest then.
Speaker Change #274: I would say with faced greater challenges.
Speaker Change #274: Earlier on the now incorporation back in 2011, we've actually just trying to find the discovery in the first place than what we have in front of us.
Speaker Change #274:
Speaker Change #274: When we went out to the other sides of the basin, we'll lap that bought by some of the industry.
Speaker Change #274: Latest saying, you'll never fun economic mineralization out there, while we have to win.
Speaker Change #274: I've discovered.
Speaker Change #274: The largest and most economic.
Speaker Change #274: And environmentally late.
Speaker Change #274: Mineralization.
Speaker Change #274: That exists on the planet.
Leigh Robert Curyer: Well, we got the provincial permit in the quickest time ever and the first one in the last 20 years, and the federal permit will be no different. We have assembled the best of the best into the company and will continue to do so. Extraordinary organizations where we are going to be introducing additional innovation and optimizing efficiency and safety. So yeah, you're quite right, mining is a challenging game, no doubt about that, but our track record has... demonstrated clearly that we understand exactly what we're doing, the risks and the opportunities, and we approach it in a manner that employs fact-based objectivity from all the relevant disciplines required to be successful. The permitting aspect.
Speaker Change #289: We then got Tal, we you'll never get a permit well we got the provincial pyramid in the <unk>.
Speaker Change #289: Quick as Stan.
Speaker Change #289: And the first one in the last 20 years in the federal payment will be no different.
Speaker Change #289: We have assembled assembled the best of the best.
Speaker Change #289: Into the company and we'll continue to do so.
Speaker Change #289: We had a.
Speaker Change #289: Partnerships with.
Speaker Change #289: Extraordinary organizations, where.
We're going to be introducing additional innovation and optimizing.
Efficiency and <unk>.
Speaker Change #289: 50.
Speaker Change #290: So yeah, you're quite right mining is a challenging guy.
Speaker Change #290: About it but our track record has.
Speaker Change #323: Demonstrated clearly that we understand exactly what were doing the risks and the opportunities.
Speaker Change #290: And we approach it in a manner, which employees fact based objectivity.
Speaker Change #290: From all of the relevant disciplines required to be successful in and say.
Speaker Change #290: The permitting aspect.
Leigh Robert Curyer: Even when we're in production in the future, when we look back, what was the biggest risk? It was always going to be around the permit because it's got the most variables and the largest number of stakeholders involved. But we've already got the provincial permit, and the federal permit is in the final stages, and we look forward to that permit and getting just into construction. We're then narrowed down to just one aspect, and we love nothing more than having everything in our control, and construction will predominantly be 100% in our control. Very exciting time for investors. We're at a real inflection point.
Speaker Change #290: One way in production.
Speaker Change #290: And in the future when we look back what was the biggest risk it was always going to be around the Permian.
Speaker Change #290: Because it has got the most variables and the most variable.
Speaker Change #291: Largest number of stakeholders involved.
Speaker Change #291: We've already got the provincial permit and the federal permit is in the final stages.
Speaker Change #293: We look forward to that permit and getting just into construction within narrowed down to just one aspect.
Speaker Change #292: We love nothing more than having everything in our control and construction will predominantly be 100% in our control site.
Speaker Change #292: Exciting time for investors, where at a real inflection point in.
Leigh Robert Curyer: And the moment we receive that federal permit, we'll be constructing the mine and accelerating towards cashflow, which will take us into a top 10 mining company worldwide. So whilst you may not have seen NexGen as a brand, construct a mine, the people within our organization have in their previous roles. And so we're very excited and energised more than ever for this next phase. Yeah, Fred, I might just add that while this all sounds big, like a big mine going to produce lots of uranium, you're talking about if this were a gold mine, you wouldn't even have heard about it in terms of the tons that were moving a day.
Speaker Change #326: The amendment, we received that federal permit will be constructing the mine and accelerating towards Quechuas, which would take us into a top 10 mining company worldwide. So whilst you might notice, saying nextgen as a brand.
Speaker Change #292: Construct demand.
Speaker Change #292: The people within our organization has in the previous.
Speaker Change #292: Yes.
Speaker Change #292: Rose.
Speaker Change #292: And so.
Speaker Change #292: Yes.
Rose: We're very excited and energized more than ever these next slides.
Fred Berliner: And Fred I might just add too.
Fred: It's important to put in context that this while this all sounds big like a big mine going to produce lots of uranium you're talking if this is a goldmine you wouldn't have even heard about it in terms of the tons that we're moving a day like it's a very small physical mine all conventional and so yeah look if we're developing a very complex.
Leigh Robert Curyer: Like it's a very small, physical mine, all conventional. And so yeah, look, if we're developing a very complex, you know, you know, mine that's very large or complex, as I said. Yeah, I mean, on a risk-adjusted basis, you got to consider those things.
Fred Berliner:
Speaker Change #295: It's very large or complex as I said.
Speaker Change #295: Yes.
Speaker Change #298: On a risk adjusted basis, you got to consider those things, but for US we're building a very tiny little conventional underground gold mining.
Travis G. McPherson: But for us, we're building a very tiny little conventional underground gold mine in an effectively granite hard rock setting, using long hole stoping and conventional processing at surface, except the difference, obviously, is that the product that we're producing is extremely valuable and extremely strategic because it's actually an energy battle in the green energy transition. So yeah, mining is not easy, but the size of the prize here is enormous. Your next question comes from Reid Rubin from Private Investor. Please go ahead. This morning,
Speaker Change #295: Effectively granted hard rock setting.
Speaker Change #300: Using long haul stoping and conventional processing at surface like.
Speaker Change #297: Except the difference obviously being the product that we're producing is extremely valuable and extremely strategic because it is actually an energy metal in the green energy transition so.
Speaker Change #299: Yes, my name is not easy, but the size of the prize here is enormous.
Speaker Change #299: Your next question comes from Reed Rubin private Investor. Please go ahead.
Julie: On the mill, what is the budget for the completion of the mill? And what will the annual capacity be? And let me point out, as far as I know, there's only one mill in the lower 48.
Reed Rubin: Good morning on the mill what is the budget for the completion of the mill and what will the annual capacity.
Reed Rubin: And let me point out there as far as I know, there's only one mill in the lower 48.
Reid Rubin: Yeah, so as per the feasibility study of 2021, and hello Reid, it's been a while since we spoke pre-COVID, so appreciate the support throughout here. Yeah, so as per the feasibility study of 2021, the mill represented approximately a third of their overall capex. That's under, you know, they'll need the inflation adjusted numbers, and we'll provide those numbers at... or around the end of Q2. There is one, and we will be building a mill which has a capacity of 30 million pounds per annum. 30 million times more energy per atom than the sun.
Reed Rubin: Yeah.
Reed Rubin: The feasibility study of 2021.
Speaker Change #299: And Hello, right. It's it's a it's been a while since like with.
Speaker Change #305: <unk> spoken pre Covid. So I appreciate your support throughout here.
Speaker Change #304: Yes, so as per the feasibility study in 2021 the mill represented.
Mill Representative: Approximately a third of the overall capex.
Mill Representative: Capex.
Speaker Change #306: That's under yet.
Speaker Change #303: That will make the inflation adjusted.
Speaker Change #302: And we will.
Speaker Change #302: Those numbers.
Speaker Change #310: Or around the end of Q2.
Speaker Change #302: There is one.
Speaker Change #308: Yeah, and we will be building, a mill, which has a capacity of 30 million pounds per annum output.
Speaker Change #309: 30 mill per annum.
Speaker Change #308: Yes.
Leigh Robert Curyer: Yes. That's a fabulous meal. Thank you very much. Thank you, Greg. And there are no further questions at this time. I will turn the call back over to the CEO, Leigh, for closing remarks. Thank you, Julie. Yeah, so I thank everyone for their time and interest and questions on today's call. We are incredibly excited about the balance of 2024 and, as mentioned, this inflection point as we look to conclude the federal permitting process with the CNSC, with stories stronger than ever. Rook One went into production.
Speaker Change #318: That's a fabulous mill, thank you very much.
Greg: Thank you Greg.
Unknown Executive: And there are no further questions at this time I will turn the call back over to the CEO Lee for closing remarks.
Julie Welcome: Thank you Julie.
Julie Welcome: Yes, sorry.
Lee: I, thank everyone for their time and interest and questions on today's call.
Lee: We are incredibly excited about the balance of 2024 and as mentioned this.
Lee: Inflection point as we look to conclude the federal permitting process with the same let's say.
Lee: Storage stronger than ever work, one waiting production, we're going to be at the bottom of the cost curve and fully exposed to future uranium prices.
Leigh Robert Curyer: We're going to be at the bottom of the cost curve and fully exposed to future uranium prices. The provincial permit is in place, and the federal permitting is in the final stages. And this uranium market is entering into a new, unprecedented era, and NexGen is incredibly well positioned, ready, and Leigh Bridged to it all.
Speaker Change #324: The provincial permit is in place and the federal permitting is in the in the final stages and this Iranian market is entering into a new unprecedented era.
Lee: And.
Speaker Change #321: <unk> is incredibly well positioned ready.
Leigh Robert Curyer: So I thank you for your interest and look forward to our next call, the Q2 call for 2024. Thank you. Ladies and gentlemen, this concludes today's conference call. You may now disconnect.
Les: And Les reached two it'll so thank you for your interest and look forward to.
Lee: Mexico.
Mexico: The Q2 call for 2024, thank you.
Speaker Change #322: Ladies and gentlemen. This concludes today's conference call you may now disconnect. Thank you.
Speaker Change #322: [music].