Nexgen Energy Ltd T.NXE

RBC

[retiredcf]

December 4, 2024

NexGen Energy Ltd.
Announces initial contracting for 5Mlbs over 5-years with US utilities

TSX: NXE | CAD 11.44 | Outperform | Speculative Risk | Price Target CAD 15.00

Sentiment: Positive

Our view: We expect a positive reaction from NexGen shares to the announced initial contracting which we view as an important de-risking milestone. The company telegraphed potential contracting on the Q3 call, indicating it would likely come before year- end; however, now with initial contracts in hand and ~2.7Mlbs of stockpiled U3O8, we see NexGen as well-positioned to secure project financing post a potential Federal approval in 2025. The terms of the contracts are aligned with the company's strategy to maximize market-related exposure and importantly are contingent on achieving commercial production, which mitigates the risk from potential delays in project start-up.

Summary: NexGen announced the first contracted volumes from the Rook I project with multiple US utilities. The offtakes total 5Mlbs over the first 5-years production with annual delivery of ~1Mlbs/year from 2029 to 2033 subject to commencement of commercial production. The agreements include market-related pricing mechanisms at time of delivery with the below sensitivity table provided to illustrate the potential realized price at different spot uranium prices. NexGen highlighted the company remains in ongoing discussions with additional global utilities for further offtake agreements.