Aura Energy Ltd (ASX: AEE, AIM: AURA), a company specializing in uranium and future metals exploration and development, is on the threshold of transitioning into a full-scale producer.
The company’s primary project, the Tiris Uranium Project in Mauritania, Africa, is nearing production readiness. This project, which has the backing of the Mauritanian Government with a 15% stake, is fully licensed, including exploration and environmental permits, and is supported by a 30-year Mining Convention.
Aura aims to establish Tiris as a cost-effective, long-term mine. The project boasts a mineral resource estimate of 58.9 million pounds of uranium, projected to sustain 16 years of operation with a post-tax net present value (NPV) of US$226 million and a post-tax internal rate of return (IRR) of 28%.
In the context of a warming uranium market, January 2024 saw uranium prices hit a 16-year peak, surpassing US$100 per pound. This surge is driven by a global shift towards decarbonization and net-zero goals, favouring nuclear power alongside wind and solar energy.
Morgan Stanley (NYSE:MS) has released a report forecasting a continued rise in uranium prices, with a bullish average price of US$119 per pound for the 2024 financial year. Uranium contracting volumes are at their highest since 2012, a trend expected to persist as Europe extends the lifespan of its nuclear plants and new ones are constructed globally.
Aura Energy, poised to begin uranium production by late this year or early next, is well-positioned in this expanding market. The company has secured a US$10 million offtake financing agreement with Curzon Uranium, a London-based firm, with provisions for doubling this facility.
This agreement includes the sale of 800,000 pounds of uranium at fixed prices, 750,000 pounds at market-linked prices, and an additional 1.05 million pounds as optional volumes for Curzon.
Beyond Tiris, Aura Energy also manages the Häggån Polymetallic Project in Sweden and the Tasiast South Project in Western Australia. These projects, rich in critical and battery minerals, align with Aura’s strategy to supply essential minerals for the global market.
Häggån hosts various battery metals, including vanadium, nickel, molybdenum, and zinc, as well as sulphate of potash, a key agricultural fertilizer. Tasiast, still in early exploration stages, shows potential for nickel, cobalt, and gold.
Collectively, these projects underscore Aura’s commitment to producing key minerals for clean energy and a low-carbon future.
The leadership team at Aura Energy boasts extensive industry experience. Non-executive chair Phil Mitchell has a background in business development and strategy at Rio Tinto. Non-executive director Patrick Mutz brings significant uranium expertise, having led Deep Yellow, another Africa-focused uranium company.
Warren Mundine, another non-executive director, is a renowned public figure with over four decades of experience in various sectors. Bryan Dixon, also a non-executive director, is recognized for his expertise in managing mining projects. Finally, David Woodall, the managing director and CEO, has a 30-year track record in the mineral resources industry, including roles at Rio Tinto, Fortescue Metals Group, Newcrest Mining, and Ivanhoe Mines.
This team’s collective experience positions Aura Energy at the forefront of the transition from exploration to production, ready to capitalize on the growing demand for uranium and other critical minerals.
