Hi Goldbull22, I appreciate your enthusiasm but I think that you...

Hi Goldbull22,

I appreciate your enthusiasm but I think that you are a little too optimistic at present.

Firstly, PEN don't have 6m lb locked in at $51-53 lb. A chunk of this (1.4m lb from memory) is optional supply at the discretion of the utilities.

Thus, this will not get exercised unless the price is > than $51-53 lb, as such it is really a non-issue and provides PEN will no real protection from low prices (as the utilities won't exercise their option and simply buy at lower prices on the spot market).

I also think that you are forgetting that the lb produced at Lance are much higher cost than those purchased on the Spot market and as such have an overall negative FCF implication.

In addition, who will buy PEN at this point? Uranium mining is a very niche activity. There is not a single market participant that is in a position to lob a cash TO offer at PEN and it is far too early for generalist PE firms to have a crack or related energy entities.

The U sector is still in the bottoming/ stealth phase at present and this may last for some time.

I don't think that PEN's next round of sales will yield anything close to the $20m in revenue that you are suggesting. Remember, the last period included sales from the 935k lb of future contracted sales.

I still haven't seen a publicly disclosed announcement from the Company that adequately discloses the company's position in relation to:

(1) How many lb remain contracted at $51-53 lb up until 2021 post-transaction of the sale of 935k lb

(2) From the answer provided in (1) above, how are these lb going to be sourced - what will be the split between the high cost Lance operation and the Spot Market

(3) Given that large buyers are now entering the Spot Market (Yellowcake, UPC, CCJ) does PEN have a locked in supply of spot market lb to meet the obligations of (1) above that ensures positive FCF until the, assumed successful, permits for low pH operations at Lance are granted and the transition is successfully executed.

Don't get me wrong. I own PEN and, if things work out, it will be a multibagger.

I think, however, that you need a great deal of patience here (and not all your eggs in one basket) to receive the full benefit here. It may take some years to play out.

Cheers
John