Producing Uranium Globally & Taking Advantage of Positive M&A Environment

• Boss Energy is a uranium producer with 100% ownership of the Honeymoon mine in South Australia, a 30% stake in Alta Mesa project in South Texas, and an 18.4% holding in Laramide Resources.
• Honeymoon is ramping up production to 850,000 pounds by June 2025, 1.6 million pounds by June 2026, and 2.45 million pounds at full capacity.
• Boss Energy has a strong balance sheet with nearly $250 million AUD, no debt, and is approaching positive cash flow by the end of Q2 2025.
• The company expects its combined production with Alta Mesa to exceed 2 million pounds annually, with expansion potential.
• Despite current market uncertainty in uranium, CEO Duncan Craib believes consolidation opportunities exist for well-funded producers.

Boss Energy (ASX: BOE) is positioning itself as a significant uranium producer during a period of market uncertainty for the nuclear fuel. In a recent interview, CEO Duncan Craib outlined the company's production ramp-up at its Honeymoon mine, strategic investments in other uranium assets, and perspectives on the broader market dynamics. With uranium prices having retreated from the highs at the beginning of 2024, Boss Energy is leveraging its production capabilities and strong balance sheet to build a diversified portfolio of uranium assets across multiple jurisdictions. The company's strategy centers on establishing reliable production first, then making strategic acquisitions of high-quality assets that can provide growth over the longer term.

Boss Energy's Asset Portfolio

Boss Energy currently operates with three main assets in its portfolio. The company owns 100% of the Honeymoon uranium mine in South Australia, which is currently in production. Additionally, Boss holds a 30% stake in the Alta Mesa project owned by enCore Energy, providing exposure to the US uranium production. Most recently, the company has acquired an 18.4% stake in Laramide Resources, gaining access to the Westmoreland deposit in Queensland, Australia, which contains approximately 70 million pounds of inferred & indicated resources, and several other proejctsin the US and Kazakhstan.

The Honeymoon mine serves as Boss Energy's flagship asset, with production gradually ramping up as planned. The Alta Mesa project represents an entry point into the US market for Boss, while the Laramide stake is viewed as a longer-term strategic position, particularly given the current moratorium on uranium mining in Queensland. Regarding the Laramide investment, Craib explained: 

"We've been looking at Laramide for many years. We think their flagship resource called Westmoreland in Queensland is a fantastic asset. It's nearly 70 million pounds of inferred & indicated resource, in a jurisdiction that hosts large ore bodies."

Production Ramp-Up & Good Margins

The Honeymoon mine is on track to reach production of 850,000 pounds by June 2025, with plans to increase to 1.6 million pounds by June 2026, and ultimately to the nameplate capacity of 2.45 million pounds. The company is employing in-situ recovery (ISR) mining methods, which typically involve a gradual ramp-up as new wellfields are brought into production.

The February 2025 production exceeded the entire December 2024 quarter, indicating strong progress in the ramp-up. The company reports that the tenor of uranium from the wellfields is higher than forecast, and the lifespan of the first two wellfields appears to be longer than initially expected. The durability of the resins used in the ion exchange columns has also exceeded expectations.

Importantly, Boss Energy maintains competitive production costs, reporting C1 costs of $23-25 per pound, which provides a substantial margin at current spot prices around $65 per pound. This cost advantage is attributed to the ISR mining method, which is generally less expensive than conventional mining approaches.

Alta Mesa Project Development

The Alta Mesa project, in which Boss Energy holds a 30% stake, is also ramping up production. The second ion exchange circuit has recently been brought online, which increases throughput capacity. A third circuit is scheduled to come online by the end of 2025, which will bring the operation to its nameplate capacity of 1.5 million pounds annually. Boss Energy is entitled to 30% of this production, or approximately 450,000 pounds per year at full capacity.

While the Alta Mesa project has faced some challenges in meeting production targets, Craib indicated that these were largely related to the availability of drill rigs needed to develop new wellfields. With these issues being addressed, the project is expected to continue its ramp-up as planned. The operation has the potential to expand beyond its current nameplate capacity to 2 million pounds with appropriate licensing already in place.

Interview with Chief Executive Officer, Duncan Craib

Strategic Investment in Laramide Resources

Boss Energy's recent acquisition of an 18.4% stake in Laramide Resources represents a strategic move to secure future growth potential, particularly in Queensland, Australia. The Westmoreland uranium deposit in Queensland is currently subject to a moratorium on uranium mining, but Craib believes this could change with the right approach.

"Queensland is attractive to us. The new premier representing the Liberal National Party or combined Coalition, Premier Crisafulli, was previously the Minister for Mines and energy within that state when they were last in power. And during that time he lifted the moratorium in the state for uranium mining."

The investment in Laramide was possible due to Boss Energy's strong balance sheet, and the company views it as a long-term strategic position that could yield significant value if the regulatory environment in Queensland becomes more favorable. Additionally, Laramide has assets in New Mexico and Kazakhstan that could provide further opportunities for development or consolidation.

Financial Position & Future Outlook

Boss Energy maintains a strong financial position with approximately $250 million AUD in liquid assets and no debt. The company expects to achieve positive cash flow by the end of the June 2025 quarter as production continues to ramp up. This financial strength provides flexibility to pursue additional strategic opportunities if they arise, particularly if market conditions create value in the sector.

Looking ahead, Boss Energy will report its March quarter results in April 2025 and aims to hit its production guidance of 850,000 pounds by June 2025. The company will also announce its all-in sustaining costs in the June quarter, providing further transparency on its operational efficiency.

The combination of Honeymoon's production and Boss Energy's share of Alta Mesa output positions the company to become a 2 million pound-plus producer in the near future, with the potential for further expansion. This established production base, coupled with strategic investments and a strong balance sheet, positions Boss Energy well within the uranium sector despite current market uncertainties.

Industry Consolidation Potential

Craib expressed support for industry consolidation, particularly to reduce corporate overhead and create operational synergies. He suggested that companies with strong cash flow and balance sheets, like Boss Energy, may be well-positioned to pursue acquisitions if other developers struggle to advance their projects in the current price environment.

The company's approach to M&A has been strategic rather than aggressive, focusing on assets that can economically produce uranium. With many uranium development projects potentially delayed or unable to secure financing at current prices, opportunities for consolidation may increase in the coming years.

The Investment Thesis for Boss Energy

• Established Production: Already producing uranium at Honeymoon with a clear ramp-up to 2.45 million pounds, eliminating development risk faced by many peers.
• Strong Economics: C1 costs of $23-25/lb provide substantial margins at current spot prices (~$65/lb).
• Robust Balance Sheet: ~$250 million AUD in liquid assets with no debt provides flexibility and resilience during market volatility.
• Approaching Cash Flow Positive: Expected to achieve positive cash flow by Q2 2025, reducing financing risk.
• Diversified Asset Base: Production in Australia (Honeymoon), exposure to US market (Alta Mesa), and strategic position in Queensland resources (Laramide).
• Expansion Potential: Both Honeymoon and Alta Mesa have expansion capacity beyond current nameplate levels.
• Positioned for Consolidation: Financial strength enables potential strategic acquisitions during a period of sector weakness.
• ISR Mining Advantage: Lower-cost in-situ recovery mining method provides operational flexibility and competitive production costs.
• Contract Protection: Sales mix includes contracted volumes, providing some insulation from spot price volatility.
• Management Experience: Demonstrated ability to bring mines into production in challenging market conditions.

Uranium Market Analysis

The uranium market is experiencing a period of substantial uncertainty, with prices having retreated significantly from early 2024 highs. This volatility stems from multiple factors, including uncertainty around tariffs, questions about Russian sanctions, temporary demand hesitation from utilities, and potential inventory selling from investment vehicles and producers needing cash flow. Nuclear utilities typically maintain strategic inventories and can afford to temporarily step back from purchasing during uncertain periods, exacerbating price weakness.

Despite these near-term challenges, the fundamental demand case for nuclear energy remains intact. As Duncan Craib notes, 

"Nuclear accounts for about 17% of [US] energy needs and it's baseload, dependable 24/7 power supply. So it's part of the energy mix that's needed in a dependable grid." 

This baseload reliability provides a long-term foundation for uranium demand, particularly as global energy transitions progress.

The supply side faces significant constraints, with major projects experiencing regulatory delays and higher price requirements for new development. Craib's perspective is clear: 

"There's enough uranium in the world, it just needs a higher incentivized price to mine it." 

This supply-demand dynamic suggests the current market weakness may be temporary, with industry analysts anticipating improvement in the second half of 2025.