Alligator Energy - Scoping Study Advances Samphire Uranium Project

• Alligator Energy Limited is a uranium development and exploration company currently advancing the Samphire Uranium Project in South Australia. They're moving through the early development stage and have a field recovery trial underway.
• The project is an ISR (In-situ recovery) project, with a planned feasibility study set for 2024 and aims for production thereafter. Additional uranium exploration activities are ongoing in the Northern Territory and Cooper Basin of South Australia.
• Alligator Energy has upgraded their resource to a higher cut-off grade, conducted two resource upgrades, and completed a scoping study.
• Upcoming plans include a pilot field recovery trial in the latter part of the current year. Extensive research and drilling activities have been conducted to improve the understanding and quality of the uranium resource.

Alligator Energy Well Positioned to Benefit from Rising Uranium Market

Australian uranium development company Alligator Energy (ASX: AGE) is advancing its flagship Samphire Uranium Project in South Australia towards production in 2027. With uranium prices on the rise amid supply constraints, Alligator Energy is one of the few uranium juniors well-positioned to capitalize on the strengthening market fundamentals.

Interview with Chief Executive Officer, Gregory Hall

Samphire Uranium Project

Alligator Energy's key asset is the Samphire Uranium Project located 250km north of Adelaide in South Australia. Samphire hosts a shallow sandstone-hosted uranium deposit amenable to low-cost in-situ recovery (ISR) mining.

• The project has a resource of 18Mlb U3O8 grading 250ppm U3O8 using a 250ppm cut-off. This includes 10.5Mlb in the Indicated category.
• A scoping study completed in early 2023 outlined plans for a 1Mlb pa uranium production operation over a 12-year mine life, producing 10Mlb in total.
• The scoping study returned positive economics including an NPV of US$205M and 29% IRR with uranium prices at US$65/lb.
• Drilling is underway in 2023 aimed at expanding the resource which could support a larger production profile beyond 1Mlb pa.
• A field leach trial is planned for Q3 2023 which will derisk the project and provide key inputs into a full feasibility study in 2024.

Ideal Location

Samphire benefits from its location in mining-friendly South Australia which already hosts several uranium mines. The project area has established infrastructure, and ready access to groundwater, and is located close to the railway line and Stuart Highway. The paleochannel-hosted deposit occurs at shallow depths of 60-80m, advantageous for low-cost ISR mining.

Rising Market Fundamentals

After a prolonged downturn, the uranium market has undergone a marked improvement since 2018 on the back of rising demand and constrained supply. Uranium prices have risen from US$25/lb to over US$50/lb currently. Meanwhile, global political developments have strengthened the investment case for uranium:

• Increasing focus on energy security and reducing reliance on Russian energy imports. This is already driving a shift away from Russian uranium supply in North America and Europe.
• Strong bipartisan political support for nuclear energy in the US, underpinned by policy shifts and funding in the Inflation Reduction Act.
• Japan restarting reactors, with 9 reactors newly approved for restart.
• Ambitious new reactor construction targets announced in several countries as part of a nuclear renaissance, especially in Asia.

Adding to supply-demand tightness, mine closures and project deferrals during the uranium bear market have constrained mine supply growth. Several idled mines are now looking to restart but this new supply is already largely spoken for. With demand strengthening, analysts widely expect a structural supply deficit to emerge during the late 2020s. This is anticipated to drive uranium prices up to US$75-100/lb over the next decade.

In this context, Alligator Energy's Samphire Uranium Project is well-timed to commence production in 2027 to supply into rising uranium demand. As a potential low-cost ISR operation based in a Tier 1 mining jurisdiction, Samphire should attract interest from uranium buyers. Marketing activities have commenced with nuclear utilities in North America and Europe.

Well-Funded to Reach Production

With A$20M in cash following a capital raising in late 2021, Alligator Energy is funded through to completion of the Samphire feasibility study in 2024. The company also has an agreement with global commodities trader Traxys, whereby Traxys may provide a US$15M finance facility to fund later-stage development in return for marketing rights over a portion of future production. This provides a pathway to production without necessarily requiring a return to equity markets.

Additionally, Alligator Energy has a strong board and management team with extensive uranium project development experience to progress Samphire to production.

Other Exploration Upside

Beyond Samphire, Alligator Energy has an extensive exploration portfolio covering known uranium provinces in South Australia and the Northern Territory. While early-stage, exploration success could deliver additional uranium resources to complement Samphire as a multi-project developer. The company also holds nickel-cobalt projects in Italy.

With strengthening uranium market fundamentals, exposure to a potential low-cost ISR uranium development project could be an attractive component for investor uranium portfolios. Alligator Energy provides this leveraged uranium exposure along with an experienced team to deliver. With exploration upside, Samphire's projected production profile could continue growing. As de-risking milestones are achieved over the next 2-3 years, Alligator Energy should begin to capture increasing investor interest.

Investment Thesis

Leveraged to Rising Uranium Prices

As a uranium developer, Alligator Energy provides leveraged exposure to anticipated increases in the uranium spot price. Analyst consensus suggests uranium prices could double over the next 5-10 years as the supply-demand balance tightens. Any upside in uranium prices has an outsized benefit to Alligator as a producer.

Low-Cost Production

The Samphire project is projected to be in the lowest quartile of industry production costs based on a shallow ISR operation and favorable jurisdiction. This gives Samphire a competitive advantage, allowing profitable production even at lower uranium prices. The company estimates cash costs of US$31-33/lb U3O8.

De-Risking Milestones

As Project de-risking milestones are met over the next 2-3 years, this can catalyze share price re-ratings. Upcoming catalysts include resource expansions, positive field trials, permitting progress, and off take agreements.

Scarcity Value

With very few uranium developers left globally, there are limited options for investors seeking leveraged uranium exposure. Alligator provides a rare listed uranium developer opportunity.

Exploration Upside

Exploration success across Alligator's portfolio could uncover satellite uranium deposits to support Samphire project growth over time.

Management Pedigree

An experienced board and management team reduces execution risk, increasing the likelihood of successful uranium project development.

In summary, Alligator Energy offers investors leveraged exposure to rising uranium prices, low-cost production potential, project de-risking catalysts, scarcity value, exploration upside, and proven uranium development expertise.