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TORONTO, June 15, 2022 /CNW/ - Global Atomic Corporation ("Global Atomic" or the "Company") is pleased to advise that it has received a Letter of Intent for the procurement of uranium from a major North American utility. The award follows a comprehensive due diligence process conducted by the utility, and reflects the confidence the fuel buyers have in the Dasa operation.
The award defines the supply of 2.1 million pounds U3O8 over a six-year period commencing in 2025, representing approximately 7 percent of Dasa's production over the period.
Pricing is designed with two components to provide a blend of predictability and market exposure. The market component is linked to the uranium spot price index, subject to a floor and ceiling. The floor price ensures that the all-in sustaining costs of the Dasa operation are comfortably covered, and the ceiling allows the Company to benefit from the improving market environment.
This award, with revenue potential valued at over US$110 million in real terms, is consistent with the Company's strategy of establishing sales contracts with Tier 1 global utilities, at volumes sufficient to underwrite debt financing, thereby limiting equity dilution as the Dasa operation moves into production.
The award is subject to the successful conclusion of a purchase-sale contract, which the Company will now progress.
Global Atomic President and CEO, Stephen G. Roman commented, "This is a significant milestone for Global Atomic and the Dasa operation. We are cognizant that contract awards for greenfield uranium projects are not made every day, and this is among the first in this market cycle. It reflects the faith the fuel buyers have in our project and the team, and we look forward to fostering this important relationship over the decades to come. Despite market volatility, the need for low carbon nuclear power remains undiminished, as does the need for secure fuel supply. This news follows the recent LOI ("Letter of Interest") from Export Development Canada for up to $75 million as the cornerstone to our project financing. These recent milestones continue to build the foundations for Global Atomic as a new, emerging Uranium producer."
About Global Atomic
Global Atomic Corporation (www.globalatomiccorp.com) is a publicly listed company that provides a unique combination of high-grade uranium mine development and cash-flowing zinc concentrate production.
The Company's Uranium Division includes four deposits with the flagship project being the large, high-grade Dasa Project, discovered in 2010 by Global Atomic geologists through grassroots field exploration. With the issuance of the Dasa Mining Permit and an Environmental Compliance Certificate by the Republic of Niger, the Dasa Project is fully permitted for commercial production. The Phase 1 Feasibility Study for Dasa was filed in December 2021 and estimates Yellowcake production to commence by the end of 2024. Mine excavation began in Q1 2022.
Global Atomics' Base Metals Division holds a 49% interest in the Befesa Silvermet Turkey, S.L. ("BST") Joint Venture, which operates a modern zinc production plant, located in Iskenderun, Turkey. The plant recovers zinc from Electric Arc Furnace Dust ("EAFD") to produce a high-grade zinc oxide concentrate which is sold to zinc smelters around the world. The Company's joint venture partner, Befesa Zinc S.A.U. ("Befesa") listed on the Frankfurt exchange under 'BFSA', holds a 51% interest in and is the operator of the BST Joint Venture. Befesa is a market leader in EAFD recycling, with approximately 50% of the European EAFD market and facilities located throughout Europe, Asia and the United States of America.
The information in this release may contain forward-looking information under applicable securities laws. Forward-looking information includes, but is not limited to, statements with respect to completion of any financings; Global Atomics' development potential and timetable of its operations, development and exploration assets; Global Atomics' ability to raise additional funds necessary; the future price of uranium; the estimation of mineral reserves and resources; conclusions of economic evaluation; the realization of mineral reserve estimates; the timing and amount of estimated future production, development and exploration; cost of future activities; capital and operating expenditures; success of exploration activities; mining or processing issues; currency exchange rates; government regulation of mining operations; and environmental and permitting risks. Generally, forward-looking statements can be identified by the use of forward-looking terminology such as "plans", "is expected", "estimates", variations of such words and phrases or statements that certain actions, events or results "could", "would", "might", "will be taken", "will begin", "will include", "are expected", "occur" or "be achieved". All information contained in this news release, other than statements of current or historical fact, is forward-looking information. Statements of forward-looking information are subject to known and unknown risks, uncertainties and other factors that may cause the actual results, level of activity, performance or achievements of Global Atomic to be materially different from those expressed or implied by such forward-looking statements, including but not limited to those risks described in the annual information form of Global Atomic and in its public documents filed on SEDAR from time to time.
Forward-looking statements are based on the opinions and estimates of management at the date such statements are made. Although management of Global Atomic has attempted to identify important factors that could cause actual results to be materially different from those forward-looking statements, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements. Accordingly, readers should not place undue reliance upon forward-looking statements. Global Atomic does not undertake to update any forward-looking statements, except in accordance with applicable securities law. Readers should also review the risks and uncertainties sections of Global Atomics' annual and interim MD&As.
The Toronto Stock Exchange has not reviewed and does not accept responsibility for the adequacy and accuracy of this news release.
SOURCE Global Atomic Corporation
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