ASX All Ords share Peninsula Energy Ltd (ASX: PEN) is having a shocker on Thursday.
The uranium mining and development company fell to a 52-week low of 8.7 cents per share in earlier trading today. The Peninsula Energy share price is currently 9 cents, down 25% on yesterday's close.
By comparison, the S&P/ASX All Ordinaries Index (ASX: XAO) is in the green today by 0.07%.
Here's why this ASX All Ords mineral explorer is having a rough day.
Image source: Getty Images
ASX All Ords share dives on restart news
The uranium developer has announced today that its Lance ISR Projects in Wyoming in the United States won't restart until late 2024 under a revised life of mine plan.
The restart was previously scheduled for the middle of this year.
It was delayed after Peninsula revealed in July that its long-term resin processing provider, Uranium Energy Corp (UEC) had terminated their agreement.
Shareholders sure didn't like that, with the ASX All Ords mining share tumbling 28% on the news.
Peninsula told investors that, as a result, it would accelerate the in-house development of an expanded and fully optimised production plant to produce a high-quality yellowcake.
The upside of this plan was that, in the end, an in-house operation would ultimately deliver expanded production capacity and lower operating costs in the long term.
The downside was that this would take time to plan and, thus, would significantly delay Lance's restart.
Today, the company has released details of that restart plan. Let's review.
Peninsula reveals Lance restart plan, costs, and timeline
The newly revised life of mine model for the Ross and Kendrick Production Areas is based on a total estimated resource base of 21.8 Mlbs of dry yellowcake (U3O8). The revised plan excludes the adjoining Barber Resource Area.
The model features a complete 5,000 GPM uranium InSitu Recovery (ISR) plant. The plant will produce up to 2 Mlbs per annum of dry yellowcake.
The remaining CAPEX spend required to reach first production capacity will be US$53.4 million.
Peninsula will spend another US$17.4 million in the ramp-up period between first production and full flow-rate capacity. The company estimates C1 direct operating costs of US$21.69 per pound.
Construction is scheduled to commence late this year after final engineering and procurement work is completed. Production is expected to start in "late CY24", according to the ASX All Ords miner.
The company is targeting positive cash flow for the project in its first full year of production.
That will be 2025.
What did management say?
Peninsula's managing director and CEO Wayne Heili said:
Peninsula remains committed to bringing Lance back into production as quickly as reasonably achievable. The new model is underpinned by a quality resource and detailed technical evaluations.
The results generated demonstrate the favourable economic potential of Lance and importantly, confirm that the Company is well positioned to move ahead with the plant expansion and production restart within the current dynamics of the uranium market.
We have a worldclass project, strong economic and operational numbers, and the team in place to establish Peninsula as a fully independent end-to-end producer of dry yellowcake.
'Unique competitive advantage' for ASX All Ords share
Heili reiterated that Peninsula has a unique competitive advantage as the only ASX-listed, US-based uranium company authorised to use the low pH ISR method.
He said:
Based on the advanced development stage of the Project, Peninsula has a rapid pathway to complete the facility additions and to return Lance to production in late calendar year 2024.
Peninsula Energy share price snapshot
This ASX All Ords share has tumbled 32% in the year to date. Peninsula Energy shares are down 56% over the past 12 months.
