Berkeley Energia Ltd (LON:BKY) won support from the EU regulator for the Salamanca Mine in Spain as it signed off the company’s first uranium supply deal.
The EURATOM Supply Agency, the governing body for all nuclear fuel, said: "We particularly welcome the emergence and development of a new EU based uranium mining project and believe that it will contribute to the security of supply of natural uranium for the community users."
Berkeley will supply two-million pounds of metal over a five-year period to Curzon Resources, Interalloys Trading, with the scope to increase this to three-million pounds.
WATCH: 'Very important' sign off for Berkeley Energia ...
The stand-out feature of the deal is the price being paid, which at US$43.78 per pound is almost double the current spot price and provides a healthy gross margin on production costs of US$15 per pound.
At full production, Salamanca will be Europe's largest uranium producer accounting for 10% of the total requirement and will be important to the EU's security of supply, which currently relies on Russia, Kazakhstan and Niger for almost 60% of its uranium.
“We are very encouraged by the strong and growing support for the investment in the Salamanca mine amongst all our stakeholders,” said managing director Paul Atherley.
“Not just from the EU but also from the various levels of government and community, as evidenced by the rising number of job applications from within the local villages.”