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Peninsula Energy Nails $36M Financing For Lance Uranium Projects In Wyoming

Peninsula Energy's (ASX: PEN) chairman Gus Simpson has pulled off a coup raising $36 million in equity and convertible notes to construct its Lance uranium projects in Wyoming.

Peninsula will receive US$22 million in financing from BlackRock Financial Management by issuing senior secured notes.

Peninsula will raise a further A$14.6 million through equity issue to BlackRock and Pala Investments, 10 per cent of the share capital.

The proceeds from the issue of the Notes and Shares will be used to complete pre-SML construction, including deep disposal wells, monitoring wells, central processing plant (NYSE:CPP) site works, civil works, ancillary roads, plant long lead items and working capital.

BlackRock has a first right of refusal on planned US$80 million in debt financing in 2013.

Peninsula executive chairman Gus Simpson said, "Having BlackRock-managed funds as a debt funding partner and major shareholder is a solid endorsement of the Lance Projects.

The ongoing relationships with BlackRock and Pala will accelerate our plans to become a significant uranium producer."

Details

The Notes will be issued by Strata Energy Inc. at an issue price of 100% of their face value, mature two years from the date of issue and have a coupon of 11%. Attached to the Note facility Peninsula will also issue BlackRock 90,000,000 unlisted options exercisable at $0.08 expiring December 5, 2017.

The drawdown of the proceeds of the Notes is conditional upon the grant of the Permit to Mine and Peninsula entering into a U3O8 sales agreement on terms satisfactory to BlackRock including a net present value equal to the principal amount of the Notes.

Following several months of legal, environmental, regulatory and technical due diligence on the Lance Projects Peninsula has granted BlackRock a first right of refusal on a second debt financing planned around the grant of the final Source Materials License (SML) for an amount up to US$80 million.

Placement

Peninsula has also agreed to place 293,004,848 fully paid shares to BlackRock at A$0.04 and 152,362,521 free attaching PENOC options, raising A$11,720,622.

The share issue will result in BlackRock holding 10% of Peninsula's share capital after a placement of 71,888,075 shares and 37,381,799 free attaching PENOC options to Pala, raising an additional A$2,875,523.

The placement to Pala is in accordance with its right to maintain shareholding granted in the Pala-Peninsula shareholders agreement dated 16th December 2010.

Wyoming stepping up to the plate

Peninsula has also commenced the application process with the Wyoming Business Council for US$70 million in Industrial Development Bonds (IDB).

Crook County, the issuer of the IDB's, has voted to unanimously support the application and the granted bonds would complete the debt financing requirements for the Lance Projects allowing the completion of the CPP, CPP expansion, satellite ion exchange plant and well-field development.

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