Peninsula Energy's (NYSE:PEN) cornerstone investor, Pala Investment Holdings, has provided the company with a capital injection of A$4.3 million with the exercise of 144.1 million options before the 30 June 2012 expiry.
Also demonstrating their confidence in the company executive chairman Gus Simpson and other directors have also exercised their options, totalling 15.9 million, delivering Peninsula a further cash injection of over $476,000.
Further strengthening Peninsula's cash position, Pala has agreed to underwrite any unexercised options up to the extent that it will hold 19.9% of the company.
Should all of the almost 381.9 million options expiring on 30 June 2012 be exercised, Peninsula could be looking at a cash injection of about A$11.45 million, allowing it to fast track its Lance ISR Uranium projects in the Powder River Basin, northeastern Wyoming.
This includes the start of construction in the second half of 2012 and ordering of long lead time items of the Central Processing Plant prior to the issue of the Nuclear Regulatory Commission (NYSE:NRC) Source Material Licence.
Construction work will include installation and testing of a deep disposal well, installation of production monitoring wells as well as civil works for the Central Processing Plant.
These pre-licensing construction activities are permissible, subsequent to changes to the NRC guidelines, and will shorten the overall project development timeline.
Lance ISR Projects - moving to production
The Lance ISR Projects host a JORC Resource of 51.5 million pounds U308 and is targeted for production in the second half of 2013.
A Feasibility Study, which excludes the vanadium credits, has estimated a project cash flow of $905 million on revenue of $2.2 billion.
Importantly, project funding is on track for Lance and this latest capital injection builds on the $13.8 million cash in the bank Peninsula had at the end of the March quarter.
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