Peninsula trims debt as lender backs equity swap for US uranium project

Peninsula Energy Limited has delivered a tidy piece of balance-sheet good news that is likely to keep the bulls happy after the company completed a partial conversion of its convertible loan facility.

The move to swap US$4.1M (A$6M) of debt into equity marks the second reduction of the US$15M (A$22M) debt package the company secured with Davidson Kempner in July last year, leaving only US$4.2M (A$6.1M) outstanding.

The convertible loan arrangement was a key plank of Peninsula’s broader funding strategy, underpinning a fully underwritten US$70 million equity raise at A$0.30 per share in August 2025. The raising fundamentally reset the company’s capital structure and funded the all-important commissioning of its Lance uranium project in Wyoming.

Under the latest conversion, the company issued about 19.8 million new shares at A$0.30 apiece in exchange for cancelling US$4.1M of debt. Notably, the conversion price lines up with the August 2025 capital raise, reinforcing consistency in valuation and signalling alignment between the company and its funding partner.

We are building momentum as we meet our milestones and targets

Peninsula Energy managing director and chief operating officer George Bauk

The convertible facility stepped in as a timely stopgap last year, giving Peninsula the breathing room to fire up commissioning works and roll out wellfield development ahead of its jumbo raise, all while shifting gears toward steady uranium output.

It slots neatly into a bigger 18-month reset that has seen the company tear up legacy uranium contracts, recapitalise in a big way and push Lance closer to full stride – all with its sights firmly set on riding a strengthening United States uranium market.

With this second conversion now largely stripping out the convertible component, Peninsula has materially reduced its debt burden ahead of schedule. The move has significantly lowered financing risks and sharpened the balance sheet at a time when execution at Lance is front and centre.

Peninsula Energy managing director and chief operating officer George Bauk said: “We are building momentum as we meet our milestones and targets, with funding in place and a sustainable and disciplined approach to achieving full production in the years ahead.”

Operationally, Peninsula has been busy ticking off key milestones. The company recently produced its first uranium yellowcake at Lance, advanced wellfield flow rates and continued to optimise plant performance as part of its staged ramp-up.

Earlier updates through late 2025 and early 2026 pointed to improving flow rates, steady commissioning progress and a clear pathway to scaled production.

Originally commissioned in 2015, Peninsula’s Lance uranium project in Wyoming began production using an alkaline leach method to recover uranium via in-situ recovery, where solution is pumped underground to extract uranium without conventional mining.

As uranium prices slumped to ultra-low levels in 2019, the company made a strategic call to transition to a lower-cost, low-pH acid leach system, similar to competing operations. Test work across 2020 and 2021 confirmed the ore responded strongly to the new method, however, it then took several years to redesign wellfields, secure funding and tick off regulatory approvals.

With those hurdles cleared, production was finally restarted in 2025, coinciding with a sharp rebound in uranium prices and a more supportive US nuclear policy backdrop.

With debt rapidly shrinking and production now back on track, Peninsula appears to have turned a critical corner. A cleaner balance sheet, stronger uranium prices and a fully funded ramp-up at Lance leave the company well positioned to capitalise on strengthening US demand.

If execution continues to match momentum, Peninsula could soon emerge as a key domestic uranium supplier with serious long-term leverage to the sector’s revival.

Is your ASX-listed company doing something interesting? Contact: mattbirney@bullsnbears.com.au