Boss Energy takes enCore with US expansion 

Boss Energy (ASX:BOE) has secured a 30% stake in the Alta Mesa ISR Uranium Project in South Texas, US for US$60 million in cash from enCore Energy (NASDAQ:EU) and its wholly owned subsidiary enCore Energy U.S. Corp. 

Boss Energy, which has a $1.9 billion market capitalisation, says the acquisition paves the way for increases in production and cashflow while securing further exposure to a booming uranium market. 

The Alta Mesa Central Processing Plant and Wellfield hosts a fully licensed and constructed ISR uranium plant sitting on 200,000 plus acres of private land in Texas. 

Total operating capacity of the plant is 1.5 million pounds U3O8 per year, with the project historically producing nearly 5 million pounds between 2005 and 2013 when full production was curtailed as a result of low uranium prices.   

Boss Energy Managing Director Duncan Craib says Alta Mesa shares many key similarities with its existing Honeymoon Uranium Project in South Australia, where it is set to produce the first drum of uranium in the coming weeks. 

“This acquisition marks another major milestone in Boss’ strategy to continue growing our uranium inventory, production and cashflow in tier-one locations. 

Alta Mesa will also enable us to diversify our production on both a project and geographical basis. 

Our strong production and growth outlook is underpinned by a robust balance sheet with no debt and a strategic uranium stockpile now worth $195 million based on current spot prices. 

We look forward to developing future opportunities to collaborate with enCore. 

The combination of the significant commissioning progress and ramp-up at Honeymoon, the exploration success which will underpin growth there, the Alta Mesa acquisition, our very strong balance sheet and impending cashflow means we are ideally positioned to capitalise on the strong demand for uranium from tier-one locations”.

On 6 December 2023, Boss Energy entered into a master transaction agreement with enCore and its subsidiary pursuant to which Boss Energy agreed to acquire a 30% stake in a new limited liability company that was formed to hold the Alta Mesa Project. At present, enCore holds a 70% equity in the joint venture (JV) company. 

Pursuant to the JV agreement enCore will act as manager of the JV company, which will distribute uranium from production at the project on a pro rata basis to enCore and Boss Energy’s ownership interest.  

As part of the subscription agreement, Boss Energy has gathered just over 2.564 million common shares of enCore at a discounted price of US$3.90 per share for total proceeds of US$10 million to enCore. 

The parties also entered into a uranium loan agreement providing for up to 200,000 pounds of uranium to be loaned by Boss Energy to enCore, and is expected to be transferred to enCore next week. 

The principal loan, valued at the prevailing spot price, plus interest of 9% will be repayable in 12 months in uranium or cash at the election of Boss Energy. 

Meanwhile, Boss Energy has also received an exclusive Australian licence for, and collaborating on the development of, enCore’s Prompt Fission Neutron exploration and production tool technology under a strategic collaboration agreement. 

enCore Energy is a US domestic uranium developer focused on providing clean, reliable, and affordable nuclear energy. 

Boss Energy is an ASX-listed uranium company focused on restarting its Honeymoon Mine in South Australia. The project is fully permitted, with $170 million of established infrastructure already in place, including a well-maintained plant. 

As of December 2023, Boss Energy had $226.717 million cash and cash equivalents at hand, according to its latest quarterly report. 

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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.