The Peninsula Energy (ASX: PEN) share price continues to fly

The Peninsula Energy Ltd (ASX: PEN) share price is looking to extend its miraculous run in 2021. Earlier today, Peninsula …

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The Peninsula Energy Ltd (ASX: PEN) share price is looking to extend its miraculous run in 2021. Earlier today, Peninsula announced that the company has begun trading on the OTCBQ Venture Market in the US. At the time of writing, the Peninsula share price was trading at $0.17, up 6.25%.

Let’s take a closer look at the announcement and what this means for the Peninsula share price. 

Today’s Announcement

According to the announcement, Peninsula Energy was given the green light by OTC Market Group. The company will be trading under the ticker ‘PENMF’.

Shares in Peninsula Energy have been upgraded to the middle tier of the OTC market. This comes after trading on the OTC Pink Market since January. In the announcement released earlier today, Peninsula advised investors that the upgrade was in response to strong trading volumes.

Listing on the OTCBQ is reserved for penny stocks and small foreign companies. As a result, this will allow overseas investors greater access to securities in Peninsula Energy.

Peninsula’s CEO, Wayne Heili, noted the milestone, stating:

U.S.-based investors have demonstrated a keen awareness of Peninsula and our flagship Lance Project located in the state of Wyoming but they have been limited to trading of shares during Australian market hours.

In response to the update, the Peninsula share price is trading more than 6% higher for the day.

What does Peninsula Energy do?

In the US, there has been bipartisan support to ‘decarbonise’ the country’s power sector by investing in US-produced uranium. This was culminated in the US passing the Omnibus Budget Bill. As part of the initiative, the US Department of Energy has allocated US$75 million towards the establishment of a national strategic uranium reserve. 

Peninsula Energy is an ASX-listed uranium mining company that is poised to benefit from the initiatives of the US government. The company’s flagship Lance Project is located in Wyoming, USA. Notably, it is the only US-based uranium project using a low pH, In-Situ Recovery (ISR) process.

In addition, Peninsula is the only junior uranium producer with long-term sales contracts. The company currently has contracts for up to 5.5 million pounds at US$51-$53 per pound of uranium.

For the fourth quarter of 2020, Peninsula delivered 75,000 pounds of uranium. This allowed the company to generate a net cash margin of US$1.4 million.

Since the start of November, the Peninsula share price has surged more than 170%, reflecting investor optimism in the company.

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Motley Fool contributor Nikhil Gangaram has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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