Paladin Energy leads uranium stock rally as rebound hopes raised

Paladin Energy led a rally in uranium stocks after stronger than expected production figures at its flagship Langer Heinrich Mine in Namibia raised hopes of a sector rebound.

Paladin Energy’s Langer Heinrich mine in Namibia.

Paladin Energy led a rally in uranium stocks after stronger-than-expected production figures at its flagship Langer Heinrich Mine in Namibia raised hopes of a sector rebound, with the Minerals Council of Australia and Coalition flying the flag for onshore producers.

Paladin produced 745,484 pounds of uranium oxide at the mine in the third quarter, the highest amount since the operations restarted last year.

Macquarie said the ramp-up in production came despite major rainfall in March.

The mine, located in central western Namibia about 80km east of Swakopmund and 85km northeast of the Walvis Bay major deepwater harbour, can at its peak produce about six million pounds of uranium oxide each year.

The Mining Council of Australia is urging Australia to use uranium as a bargaining chip in trade negotiations with the US and opposition resources spokeswoman Susan McDonald is pressing Labor to reveal whether uranium figures in its plans for a critical minerals strategic reserve.

Senator McDonald confirmed the Coalition would add uranium to Australia’s critical minerals list if it won government on May 3.

Paladin shares rose 12.1 per cent to $5.56 on Thursday with its weekly gain totalling 23 per cent. The stockmarket was closed on Friday for Anzac Day.

The uranium sector has been hit by a slide in spot prices, which have fallen from a decade-long highs of $US107/lb to $US64/lb from early 2024, leading companies to pause new developments and delay final investment decisions (FID).

Ord Minnett said catch-up demand for uranium oxide should push prices high following the easing of concern over a US-inspired tariff war.

Uranium developer Deep Yellow shares rose 9.63 per cent to $1.02 Thursday after it reported financing for its Tumas mine in Namibia continued to be advanced even as it delayed a final investment decision on the project.

Deep Yellow chief executive John Borshoff.

Deep Yellow chief executive John Borshoff said the company was in the “enviable position having one of the most rigorously evaluated greenfield projects in the world ready to hit the ‘go’ button.”

“The extended detailed engineering and associated studies that have been completed provide even greater confidence of what can be delivered,” he said.

“Water and power supply agreements have been completed as we push ahead with the off-site infrastructure needs, and project financing is proceeding well.

“The project is ready to take the next step to development but, as we have consistently stated, a healthy prevailing uranium market is a key prerequisite.

“The final project approval will therefore be delayed until uranium prices fully reflect a sustainable environment essential to encourage development of new projects.”

Boss Energy shares rose 8.43 per cent to $2.83 after it announced it was accelerating uranium production at its Alta Mesa uranium in Texas.

Bannerman Energy gained 6.67 per cent to $2.08 after it reported positive progress on its Etango Uranium project during the quarter in Namibia.

Bannerman executive chairman Brandon Munro said that despite seeing progress the company was not seeing the appropriate market conditions to warrant finalising offtake and financing arrangements

“However, we remain optimistic on the potential for a recovery in broader uranium trading conditions,” he said.

“Accordingly, we continue to target a positive final investment decision on Etango during 2025, market conditions permitting.

“In the meantime, our strong balance sheet means that we can comfortably progress our early construction works program, putting ourselves in a stronger position to finalise suitable offtake and financing agreements when the time is right.”

Originally published as Paladin Energy leads uranium stock rally as rebound hopes raised