Peninsula Energy Faces Delay But Strengthens Long-Term Position By Bringing Resin Processing In-House

• Peninsula Energy has decided to bring resin processing in-house for its uranium-loaded resins. They will develop the in-house capability to produce dry uranium yellow cake after their contractor gave notice that they no longer want to provide the service.
• The immediate focus is to become an independent uranium yellow cake producer and invest energy into implementing the necessary circuits at the Lance facilities.
• Peninsula Energy has been working on a revised plan, assessing how much time and money it will take to build the new circuits in the plant. They hope to have the information completed and available for public release before the end of August.
• The delay in production may affect the company's 2024 sales commitments, but they are working with their customers to adjust the delivery schedule.

Peninsula Energy Limited is an Australian uranium mining company focused on restarting production at its 100% owned Lance Projects in Wyoming, USA. With uranium demand growing globally, bringing Lance into production will position Peninsula as a major new supplier of uranium to nuclear power utilities.

Change in Strategy

Peninsula recently received notice that its long-time resin processing provider, Uranium Energy Corp (UEC), is terminating their agreement in 270 days. This led Peninsula to accelerate plans to bring resin processing in-house at Lance, as outlined in Stage 2 of its 2022 Definitive Feasibility Study.

While the in-house processing will delay Lance's restart, Peninsula believes it will ultimately allow faster ramp-up to full capacity under a more efficient, lower cost, and self-sufficient operation. Peninsula has the strong balance sheet to fund this, with US$21.5 million in cash and US$11.8 million in unsold uranium inventory as of June 30, 2023.

Ongoing Work at Lance

Peninsula remains focused on advancing Lance, with work underway on the additional plant circuits needed for on-site resin processing. Wellfield development continues to prepare for production restart. The company aims to release full capital and timing estimates by end of August.

Growth Opportunity

With growing global uranium demand, bringing Lance fully in-house positions Peninsula to become a major independent US uranium producer. Peninsula offers investors a unique opportunity to capitalize on the accelerating uranium market through an undervalued US-focused uranium developer.

Accelerating resin processing capabilities will ultimately strengthen Peninsula's production profile and shareholder value. Investors should consider building a position before Peninsula's transformed low-cost production comes online.

The in-house processing delay creates uncertainty around the timeline. Investors will need patience as the ramp-up may take longer than originally planned.

The long-term opportunity remains compelling. In-house processing will reduce costs and provide full control over operations. This positions Peninsula for an efficient production ramp-up and robust cash flows once uranium sales commence. The accelerating uranium market provides a strong backdrop amid rising demand and constrained global supply.

Investors must weigh the ramp-up risks against the long-term growth potential as Peninsula transforms into a major US uranium producer. With upside tied to uranium prices, patient investors could see substantial returns by holding through this transitionary period.

5 Takeaways for Investors

1. Bringing resin processing in-house will strengthen Peninsula's long-term position as a low-cost, independent uranium producer.
2. The in-house shift will delay the restart of production at the Lance project in Wyoming, creating some near-term uncertainty.
3. Peninsula has a strong balance sheet to fund the revised strategy, with $21.5 million in cash and $11.8 million in uranium inventory.
4. The company remains focused on advancing Lance, with plant and wellfield work continuing. Full capital estimates expected by end of August.
5. With uranium demand growing globally, Peninsula offers substantial upside as it transforms into a major US uranium supplier over the next 1-2 years.