Funding and Resource Risks Shadow GTI Energy’s Lo Herma Uranium Ambitions

• 7-year mine life with 5.98 million pounds U3O8 production target
• Pre-tax NPV8 of ~US$110M for central processing plant option
• Low capital expenditure estimated at US$67M for CPP
• Operating costs around US$32 per pound U3O8
• Project based on 32% Indicated and 68% Inferred JORC-compliant resources

A New Chapter for Wyoming Uranium

GTI Energy has released a comprehensive Scoping Study for its 100% owned Lo Herma Uranium Project, situated in Wyoming’s Southern Powder River Basin. The study, prepared by BRS Engineering Inc., outlines the potential for a competitive, low-cost uranium operation leveraging in-situ recovery (ISR) technology. This method, known for its minimal surface disturbance and cost efficiency, is well suited to the geological setting of Lo Herma.

The project targets an annual production of 800,000 pounds of uranium oxide (U3O8) over a 7-year mine life, totaling nearly 6 million pounds. The study presents two development scenarios – a central processing plant (CPP) and a satellite operation, both demonstrating strong financial returns. The CPP scenario forecasts a pre-tax net present value (NPV8) of approximately US$110 million and an internal rate of return (IRR) of 52%, while the satellite option shows even higher returns with an NPV8 of US$118 million and IRR of 66%.

Economic and Technical Highlights

Capital expenditure is notably modest, with the CPP option requiring an estimated US$67 million and the satellite operation around US$57 million. Operating costs are competitive, averaging about US$32 per pound of U3O8, positioning Lo Herma among the lower-cost uranium producers in the region. The project’s payback period is estimated at roughly 2.5 years from production start, with a breakeven uranium price near US$65 per pound.

The resource base underpinning the study totals 8.57 million pounds of uranium, with 32% classified as Indicated and 68% as Inferred under the JORC Code. While the Inferred portion carries inherent geological uncertainty, GTI Energy’s ongoing drilling programs aim to upgrade these resources and potentially extend the mine life beyond the current 7-year plan.

Geological and Environmental Context

Lo Herma’s uranium mineralization occurs as roll-front deposits within permeable sandstone units, ideal for ISR mining. The project benefits from proximity to existing infrastructure, including power lines, roads, and a skilled local workforce, which reduces development complexity and costs. Environmental assessments indicate minimal impact on local wildlife and ecosystems, consistent with Wyoming’s long history of uranium ISR mining.

GTI Energy has engaged in preliminary stakeholder consultations and is preparing for the extensive permitting process required by federal, state, and local agencies. The company emphasizes the importance of ongoing community engagement and environmental stewardship as it advances the project.

Next Steps and Market Outlook

To progress towards production, GTI Energy plans further hydrogeological testing, metallurgical studies, and resource drilling to refine project parameters and increase confidence in the resource base. The company anticipates commencing construction as early as 2028, with production targeted for 2029.

The study’s economic assumptions are underpinned by a uranium price forecast of US$90 per pound, reflecting current market trends and expert outlooks. While the uranium market remains subject to volatility, the robust project economics provide a solid foundation for GTI Energy to seek development funding.

However, the study cautions that funding is not yet secured, and permitting and resource conversion risks remain. The satellite operation scenario, while financially attractive, depends on securing toll processing agreements, which are currently not in place.

Bottom Line?

GTI Energy’s Lo Herma Project charts a promising path in uranium ISR mining, but securing funding and advancing resource confidence will be critical next steps.

Questions in the middle?

• How will GTI Energy secure the estimated US$43 million pre-production funding amid market uncertainties?
• What progress will be made in upgrading the 68% Inferred Mineral Resources to Indicated or Measured categories?
• Can GTI finalize toll processing agreements to realize the satellite operation’s economic potential?