Aurora Energy Metals: Filling the gap in the US uranium market

As part of President Joe Biden’s climate agenda and the US$368 billion Inflation Reduction Act, the government announced $20 billion in awards to expand access to clean energy across the nation. 

This latest initiative follows a decision by the US House of Representatives in December 2023 to ban unirradiated, low-enriched uranium from Russia. 

As a result, the US will now lose 12% of its uranium supply from 2028. It’s a blow that is set to affect a collective goal of tripling nuclear capacity by 2050, as agreed upon at the 2023 COP28 convention alongside some 20 other leading nations (excluding Australia). 

The US government’s offer was not lost on Aurora Energy Metals (ASX:1AE) Non-Executive Chairman Peter Lester. In a wide-ranging interview with, Lester explains how the company will look to lobby for the US funds to assist in developing its flagship Aurora Uranium Project in south-eastern Oregon. 

It is here the company is well-advanced in its Scoping Study in what Lester reiterates is the “largest mineable, measured, and indicated uranium mineral resource in the US”.

In its latest quarterly report, the latest mining study is based on the Aurora Mineral Resource Estimate comprising 107.3 million tonnes (Mt) @ 214 parts per million (ppm) U3O8 for 50.6 million pounds (Mlbs) U3O8. 

The Scoping Study identifies a mid-case pit containing a total of 20.7Mt of mineralised material at 380ppm uranium, with a strip ratio of 2.1:1 and a project life of 11 years. A conventional open pit mining method was selected, potentially using one 120t class excavator matched to 60t class trucks to achieve the targeted 2 million-tonnes-per-annum (Mtpa) run-of-mine (ROM) production rate. 

What’s more, the company states the project has access to infrastructure in an immediate area which has no known impediments to permitting and regulatory approvals. 

“I would envisage the Prefeasibility Study starting in early 2025

Lester, who is a 40-year mining veteran having dedicated tenures as a mining engineer, as well as several senior executive positions with various listed and private companies, says Aurora, while being measured in its approach, is wasting no time in advancing to the next stage. 

“I would envisage the Prefeasibility Study starting in early 2025,” he tells this news service. 

“And an important thing to note is the project is actually the largest mineable, measured and indicated uranium deposit in the US, which is a uranium hungry place, tier-one jurisdiction. The next point to make is that in the report, we really clarified the pathway to development. It covered mining, which is a progressive backfilling process. And the reason for that is it reduces the footprint on the ground in Oregon.”

The US-focused and emerging uranium producer is already lining up another bout of metallurgical drilling around the northern hemisphere autumn period to gather additional samples to refine the process route in preparation for the PFS, as reported by

And what better time to undertake these operations than in the shadow of a looming US uranium supply deficit slated for 2028. 

Interestingly, despite being the biggest consumer of uranium and having 93 nuclear reactors in its arsenal, the US only produced 194,000 pounds of uranium (roughly 0.5% of demand) as per Aurora’s latest ‘Scoping Study Interim Update’ presentation —  a sheer drop from the just shy of 5 million pounds it produced just a decade ago. 

What’s more, Canaccord Genuity’s view in its forecast report dubbed ‘Uranium | Durable demand, fragile supply’ is that the market will remain in a structural deficit through 2027, and a return to a balanced market will be highly predicated on the advancement of greenfield projects, which it says remain beset with risks. 

Supply Deficit 

Demand for the nuclear energy metal is growing, however as Canaccord Genuity explains in its forecast report, supply is as fragile as ever and any near-term supply disruptions could lead to further panic buying given the low inventory levels recorded in both US and European utilities. 

Now while the US is renowned for its uranium capabilities, consumption, and fleet of reactors, domestic production only accounts for 0.5% of the current demand. 

That is according to Aurora’s latest ‘Interim Update’ presentation, which also highlights the US imported up to 40.5 million pounds of uranium from various global jurisdictions.  

Further, GlobalData projects uranium production world-wide to grow by 11.7% to more than 60.3 megatonnes in 2024, predominantly fueled by rising output from key producers such as Kazakhstan and Canada. It is expected to grow with a compound annual growth rate (CAGR) of 4.1% from 2024 to 2030 as output reaches 76,800 tonnes in 2030.

Today, Kazakhstan supplies a quarter of all uranium needed to power the US, although it must be noted that recent projections from Kazatomprom — the top uranium producer — indicate production in 2024 to be in the range of 21,000 to 22,500 tonnes on a 100% basis, and 10,900 to 11,900 tonnes of uranium on an attributable basis — 20% below the levels stipulated in the Subsoil Use Agreements. 

Kazatomprom lays the slight decline in production at the feet of challenges related to the availability of sulphuric acid and construction delays at newly developed deposits. 

GlobalData adds the continuous ramp-up of Canada’s McArthur River Uranium Mine is also poised to contribute to the global increase.

When asked about how the US will compete with Kazakhstan and Canada, Lester explains it is the strong demand for local, ‘American-made’ production, coupled with ongoing issues in Kazakhstan, which will pave the way for a US uranium revival.

“One, the DOE (Department of Energy) and various legislations that have come in recently in the US are very strongly supporting domestic production,” he says.

“Two, Kazakhstan has got an issue at the moment in asset supply. They’ve had a major shortage of acid and most of their processes require sulphuric acid. And that’s really nipped a lot of their production in the bud.”

Therefore, Lester reaffirms that with supply concerns in Kazakhstan and the looming cut-off from Russia, local source of production again remains the most logical resolution. 

“It’s got to come out of the ground if the US does what it says it wants to do. So I’m not concerned about Kazakhstan and Canada. What happens in Kazakhstan and what happens in Canada and so on is less of an influence because the trend in the US is supply from the US.”

This uptick in a domesticated uranium supply chain runs in parallel with the US late last year deciding the time was now to triple its respective nuclear power station capacity by 2050 at the COP28 convention.

What followed was record-breaking uranium prices upwards of US$106 per pound to close off 2023 and herald in 2024.  

However, the uranium market as of late has witnessed a slump from its record-breaking highs, sitting just above the US$90 per pound threshold as of 17 April 2024, according to Trading Economics. 

The slight stumble in the market is testament to investors continuing to assess the future of the uranium market dynamics following the 2023 surge.   

Still, current prices are 76.67% higher than this time last year (when prices were just sitting around the US$52 per pound mark) supported by bets of bullish long-term demand and risks to supply. 

“The bottom line in COP28 from our point of view was the US’ position. They led the charge on the tripling of production by 2050, and everyone followed. Everyone signed off on it.”

However, that is a hard task to achieve with looming supply deficits slated for 2028 set to disrupt the US’ nuclear ambitions.

One must remember, legislative developments in the US, such as the likely restriction of Russian imports from 2028, provide impetus for the development of US uranium projects to provide domestically sourced uranium.

Therefore, as Lester points out, the question on most uranium pundits’ minds is: “Where’s it going to come from? How are they going to fill that gap? Who’s going to fill the gap?” 

“That circles around people like us,” he says. 

Putting the ore in Oregon

Headquartered in Perth, Western Australia, Aurora Energy Metals owns the Aurora Energy Metals Project in southeast Oregon, US — a large deposit considered prospective for both uranium and lithium — which has direct access to hydroelectricity, sealed and unsealed roads, a major highway, and an airstrip.  

“The US is hungry for (nuclear) power,” Lester explains to

“It’s hungry for uranium and is mandated to provide its own uranium. At the moment, they don’t produce any uranium. It’s all imported for their power stations and they don’t provide a single pound of that themselves. 

So by the time 2028 comes on, which is when the import of 12% from Russia stops, they’re going to need a lot of uranium. It feels as though this project is extremely well poised to provide the uranium that’s needed.”

As mentioned, Aurora’s project has an indicated 11-year life-of-mine targeting 2Mtpa ROM production rate, with beneficiation testwork data demonstrating an average mine grade of 385ppm. 

Although, this grade has potential to be upgraded to a feed grade above 480ppm into a leach circuit, Aurora notes. More notably, the project is scheduled to come online in conjunction with the looming US domestic supply crunch from 2028. 

Other than IsoEnergy’s (TSX.V:ISO) Coles Hill Mine in Virginia, which houses the largest uranium resource in the US at over 140 million pounds, Aurora is one of the only uranium companies slated to come online in the near future to fill the supply lull with its 50.6Mlb resource and associated 19Mlb core. 

One must recall that Virginia imposed a moratorium on uranium mining in 1982. This ban was upheld in the Supreme Court of Virginia, rendering the Coles Hill Mine obsolete.

“We’re the next cab off the rank,” Lester says. 

“We’re also the largest in measured and indicated resource, whereas the others are largely inferred resources, which means that we’re far more advanced”

“We’re also the largest in measured and indicated resource, whereas the others are largely inferred resources, which means that we’re far more advanced.” 

As such, the company believes its namesake flagship asset provides an easy answer for the US to fill the void left behind from Russia’s exclusion, as well as the issues emerging in Kazakhstan. 

Canaccord Genuity projects an increase in supply to about 150Mlbs U3O8 (+7% YoY) in 2024, driven by project restarts. In the global financial services firm’s view, these are the “easy pounds”. 

However, it says these alone will not be sufficient to rebalance the market — “difficult pounds” will also need to be developed.

When asked if Aurora’s asset is the ‘easy pounds’ or the ‘difficult pounds’ Canaccord is referring to, Lester says the company’s flagship asset is “easier than many of the others.” 

“It’s a hard-rock operation, which means it’s mining,” the Non-Executive Chairman adds. 

“Hard rock mining is easy. It’s easier also in a couple of senses than the low stripping ratio, but most of it doesn’t require any drilling and blasting either. There’s a little tiny bit of drilling and blasting, but from a mining engineering point of view, I’d call that easy. 

I wouldn’t quite go so far as to call it gardening, but it’s mining. The processing is pretty much uranium processing, tried and true around the planet, in Nevada.

We’ve so far studied three different process routes. We’re narrowing that down to one. You can’t say it’s easier or harder, it’s pretty much the same.”

To aid the current determination of a suitable processing route, the company on 12 March 2024 announced it was in discussions regarding the need to transition to a locally focused team, preferably based close to its namesake project as reported by    

“We’ve always talked about having a team in the US,” Lester says. 

“This is a US asset, and I’ve done a lot of work in the US in my career for bigger companies, and we always had [local] teams. It’s the only way you can do it there.

I’ve been on the [Aurora] board for two years and it was on day one that we had a discussion and it was all about progressively trying to build up a team, should the project be worth it and at this stage it is.”

With the Scoping Study nearing completion within the early June 2024 quarter, it has become clear to the company, there’s a need for its Aurora project to come online sooner rather than later.

Nuclear power 

Canaccord Genuity flags in its forecast report that as a low-carbon, reliable source of baseload energy, nuclear power is increasingly being viewed as critical to global decarbonisation and energy security. This was evident at the COP28 convention when the globe’s leading nations opted to triple their respective nuclear capacity.  

This, among other developments, has led to Canaccord upgrading its demand forecasts. It now expects nuclear capacity to grow at a CAGR of 3.5% through 2035 (3.2% previously), however, these forecasts do not include the deployment of small modular reactors (SMRs). 

As already discussed, mine supply looms as a potential limiting factor for the embrace of nuclear energy, a situation increasingly being acknowledged by utilities who are watching their uranium inventories dwindle. 

Consequently, while pricing signals started to emerge at the backend of 2023, for this concentrated and fragile supply chain, Canaccord Genuity believes more is required.

Global inventory overhang is now depleted and production shortfalls are the future’s reality. Reports estimate since 1990, net inventory depletion is at 1.357 billion pounds of uranium, as per a presentation from Aurora in January this year.

The company flagged this shortfall will continue for at least the next decade. Lester provides a clear understanding of what this means. 

What happened after the 1990s into the 2000s, when the uranium price went up to around US$120 per pound, the power demand wasn’t what it is now,” Lester explains. 

“The move to domestic supply wasn’t what it is now. In the US’ case, they sold a lot of their strategic inventory to overseas countries who had uranium power plants such as Japan, places in Europe. They depleted or reduced those inventories. They didn’t build them back up again because there was no strong desire to do so. Many mines shut.

The inventories provided the slack for the power stations. Unfortunately, over time, the mines weren’t there suddenly in this burst of enthusiasm to get more uranium.”

Aurora’s Chairman also reaffirms that it is the company’s greenfields asset, like other greenfields uranium projects, which are now in the box seat to satiate the hunger of the US for uranium and re-fill its dwindling uranium inventories.

Prices powering up

As mentioned, Canaccord Genuity says there is yet for a greenfield project to enter production for some time, despite uranium prices being close to a widely accepted “incentive price”.

After ending 2023 at a 15-year high of US$91 per pound U3O8 (+90% YoY), price volatility continued into 2024 with the spot price hitting US$106 per pound in early February before retreating back to its current level of US$90.65 per pound as of 17 April. 

While more than 80% of uranium is traded on the more important term market, investor sentiment and equity performance have, historically, been more strongly correlated with spot prices.

Given low or immobile inventories, a risk of production shortfalls, and extreme tightness in the spot market, spot prices could trend higher over the course of 2024, and now model an average price of US$105 per pound in 2024 (+15% vs. previous).

Lester clarifies that given these reasons, the uranium spot and contract prices are destined for a nexus towards more than US$90 a pound, which he describes as a damn good price”.

“The shortfall is going to cause the price to go up,” he says. 

“And one thing we are seeing is that the long-term contract prices are now edging into the low US$80s, which is where the spot price is. And we’re seeing this thing where the difference between the contract price, which is usually lower than the spot price, are edging towards each other.” 

“At those prices our project is a gift”

As a result, Lester says the US$85 per pound price, which was used as part of the company’s Scoping Study, could soon eclipse more than US$90 per pound.  

“In fact, the range of contract prices that are being negotiated at the moment have a floor in the low US$80s, that means people aren’t negotiating below that.”

But the scope for further price jumps doesn’t end there, with analyst John Quakes in a X (formerly Twitter) post on 15 April 2024 highlighting that the Bank of America in Q1 2024 expected supply to rebalance with nuclear fuel demand in 2025, before extending that by four years.  

Now, the multinational investment bank is expecting a supply deficit through 2030 with an associated price forecast to US$120 in 2025.  

“At those prices our project is a gift,” Lester adds. 

The way forward

With all of this information in mind, coupled with the fact that there is no way around the looming US uranium supply deficits, Lester only has one message for the market.

“This is the largest undeveloped uranium resource in the US,” he concludes. 

“And it’s going to come on stream at a time when the US is screaming for domestic supply.”

But another thing Lester wants to get across to potential investors is the fact that the company holds “a high degree of leverage.” 

“The enterprise value for all the Australian ASX-listed uranium companies on average is about US$4 per pound. We’re trading at US$0.24. We believe we’re significantly undervalued when you consider the massive projected increase in global electricity demand.”

Aurora currently has a market capitalisation of about $16 million and is trading at $0.090 on the Australian Securities Exchange (ASX).

Write to Adam Drought at

Images: Aurora Energy Metals
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Written By Adam Drought
Born and raised in the UK, Adam is a sports fanatic with an interest in Rugby League and UFC/MMA. When not training in Muay Thai and Brazilian Jiu Jitsu, Adam attends Griffith University where he is completing his final year of a Communication & Journalism degree.