Canadian uranium miner NexGen Energy is in regular discussions with mining giant BHP about its Rook I project in Saskatchewan, raising the possibility of an equity partnership as demand for nuclear power grows.
NexGen Chief Executive Officer Leigh Curyer told Reuters that the company maintains an open dialogue with BHP and regularly shares technical information with the mining giant.
“We always speak to them. We have a very open dialogue in terms of technical information,” Curyer said.
He noted that BHP had acquired a large parcel of land near the Rook project in Canada’s Athabasca Basin, adding that the miner was seeking to increase its exposure to politically stable countries.
“Let’s see where the future goes,” Curyer said when asked about the possibility of BHP taking an equity stake in the project.
Two sources familiar with the matter told Reuters that BHP’s business development team had assessed NexGen last year under its former CEO, Mike Henry. BHP declined to comment.
BHP’s new CEO, Brandon Craig, who took over on July 1, has also indicated that he intends to take a closer look at uranium. An investor familiar with his comments said Craig planned to take a “really good look” at the commodity, while acknowledging the challenge of achieving sufficient scale.
NexGen began construction of the Rook I project on Thursday and plans to raise about C$1 billion in capital over the next nine months.
The company is considering several financing options, including prepayment agreements with utility companies, debt financing and direct equity investment in the project.
Rook I is expected to begin production by 2030 and is designed to become one of the world’s largest uranium mines. The project, located around Patterson Lake in the Athabasca Basin, has helped drive NexGen’s market capitalisation to C$9.68 billion, roughly double its value a year ago.
The increase has prompted some investors to question whether NexGen may now be too expensive for BHP to pursue.
BHP already produces about 5% of the world’s uranium as a byproduct of its Olympic Dam copper operations in South Australia, although it has previously ruled out expanding uranium production there.
The mining giant is also strengthening its presence in Saskatchewan, where it is developing what is expected to become the world’s largest potash mine.
The Athabasca Basin contains the world’s largest known uranium deposits and some of its highest-grade resources, according to Canada’s natural resources ministry. The region is also home to major uranium producers including Cameco and Orano Mining.
NexGen is not the only company advancing uranium projects in the region, with miners including Denison Mines and Paladin Energy also progressing construction plans.
Growing demand for electricity from artificial intelligence and data centres is fuelling expectations of increased investment in nuclear power, while governments are seeking to diversify energy supplies amid geopolitical uncertainty.
NexGen’s Rook I project is targeting a position among the world’s largest uranium producers. Canadian investor and television personality Kevin O’Leary, who hosted Thursday’s groundbreaking ceremony, described the project as a “great energy story”.
Broker Canaccord said in an April research note that global uranium demand could triple by 2035 from 2025 levels, underscoring the growing interest in new sources of supply.
Boluwatife Enome
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