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Peninsula Energy to strengthen balance sheet with debt restructure

A partial contract monetisation is expected to generate US$10-11 million to pay down debt.

Peninsula Energy Ltd - Peninsula Energy to strengthen balance sheet with debt restructure
The company’s key asset is its Lance Uranium Projects in the US state of Wyoming

Peninsula Energy Ltd (ASX:PEN) has agreed on terms for a proposed restructure of the existing US$17 million convertible note facilities.

These terms include a planned significant reduction to the principal outstanding and an extension of the repayment date for the balance owing to 22 April 2021.

Peninsula will repay the majority of outstanding loans through a partial monetisation of its contract regarding uranium concentrate sales and purchases worth around US$10-11 million.

If the contract monetisation completes by 30 April 2020, the repayment date of residual debt will be extended to 22 April 2021.

Furthermore, the residual debt will be amended to straight term loans meaning the convertible component will be removed, and the annual interest rate will be reduced by 2%.

Official documentation representing the proposed agreed terms is expected to be executed before the end of the calendar year.

Restructure allows more time for market to recover

Peninsula’s managing director and CEO Wayne Heili said: “Substantially reducing this debt and strengthening the balance sheet through a non-dilutive mechanism has been a key corporate focus of the company.

“We are very pleased to have reached agreement with our collective lenders (and shareholders), RCF VI, Pala and the Collins Street entities, to enable this debt reduction, and to extend the remaining loan repayment date until a time where markets have hopefully improved.”

Key step achieved in transition to low pH uranium mining operation

Peninsula continues to advance the transition of its Lance Uranium Projects in Wyoming from an alkaline ISR operation to a low pH ISR operation.

A report summarising the results of the field demonstration to date was recently submitted to the Wyoming Department of Environmental Quality (WDEQ).

Heili added: “This positive news on the corporate front follows the announcement yesterday of the approval by the Wyoming Department of Environmental Quality of the Interim Operations Report, which is a key step in the progression of our ambition to be the first U.S. based uranium ISR project to utilise the cost effective and efficient low pH methodology.”

Quick facts: Peninsula Energy Ltd

Price: 0.064 AUD

Market: ASX
Market Cap: $56.46 m

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