Paladin up on long-term off-take deal

Paladin Energy stocks jumped on the ASX today, after the Perth-based uranium miner announced a six-year off-take contract with a major utility for ore from its African mining operations.

The company said the agreement, for the supply of a total of 13.73 million pounds of uranium, spanned from 2019 to 2024 and featured a $US200 million pre-payment.

Paladin shares finished trade up 9.5 per cent, trading at $1.38.

Uranium sold under the agreement will be sold at prevailing market prices, Paladin said.

A 60.1 per cent stake in Paladin’s Michelin project, in Canada, will be held by the undisclosed utility as security for the deal.

“The specific nature of the long-term offtake contract, leveraging off forward production, is in itself a strong indication of the uranium industry’s future supply challenges and fully endorses Paladin’s development vision to date,” managing director John Borshoff said in a statement.

“The company will now re-evaluate its strategic options in light of this major achievement.”