Interview with Gavin Chamberlain, CEO of Bannerman Energy Ltd.

Our previous interview: https://www.cruxinvestor.com/posts/bannerman-energy-otcqxbnnlf-leveraged-upside-as-uranium-mine-nears-build-4942

Recording date: 28th March 2024

Bannerman Energy (ASX:BMN) is advancing its flagship 8 million ton per annum Etango Uranium Project in Namibia at an opportune time in the uranium market cycle. With a mining license in hand and a rising uranium price environment, the company is progressing funding and offtake discussions to bring this world-class asset into production.

Bannerman recently completed conceptual studies examining the potential to expand production to 16 million tons per annum or extend the mine life from 16 to 27 years. While not the immediate focus, these studies demonstrate the inherent scalability and optionality Etango offers to grow with the uranium market.

On the funding front, Bannerman is pursuing a dual-track process evaluating both strategic partnerships and traditional debt/equity financing. With A$35 million in cash, the company is well funded to complete detailed engineering through year-end while the optimal financing package is assembled. Importantly, this cash buffer provides flexibility and leverage in these discussions.

Bannerman is also in advanced discussions with utilities on long-term uranium sales contracts to underpin the project financing. The company is targeting 75-80% of production under long-term contracts while retaining a portion to sell into the spot market. This strategy aims to strike a balance between security of offtake and preserving exposure to further uranium price upside.

Detailed engineering on Etango is well advanced, with lead engineer Wood Group nearing completion. Bannerman has gone to market to tender packages representing 80% of the capital cost estimate, with initial results coming in line with the DFS estimate. This provides a high degree of confidence in the capital cost projections and is a positive signal in the current inflationary environment.

The macro outlook for uranium is exceptionally strong. The growing recognition of nuclear power as a critical pillar in the clean energy transition is driving a fundamental shift in the market from a decade of oversupply to a structural deficit. At the same time, supply is constrained by years of underinvestment and a lack of new development projects. These factors are supportive of a sustained rise in uranium prices to the incentive level required to bring new supply online.

With a world-class asset, strong cash position, and proven management team, Bannerman Energy offers a compelling investment opportunity in the uranium sector. The company is well positioned to be among the first projects to enter production in the coming uranium bull market, with further upside potential from future expansion and extension optionality.

View Bannerman Energy's company profile: https://www.cruxinvestor.com/companies/bannerman-energy

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