Even if the TRL/6 demo is successful the date will be sometime in the second half of CY/24. Currently Cameco is spending C$9m (A$10,2) a quarter so even current cash burn roughly A$60m will be required to take GLE to the end of CY/24. However GLE is still recruiting and it's probably prudent to assume that SLX's contribution to the TRL/6 demo will be about A$60m. On top of that funding will be required for medical isotope and also IMO it's unlikely that the ZS Si will be cash flow positive in CY/24 so it's prudent to think that ~A$80m will be required to get SLX to end of CY/24. Currently we SLX has cash of around A$138m - so roughly $A58m will be left at the end of CY/24.
However between now and end of CY/24 GLE also has (hopefully with DoE support) will need to provide 51% of the funds (unless Cameco take up their 26%) for the FEED study and NRC construction approvals for FID (Financial Investment decision) for construction of the PLEF in CY/25. This FEED/NRC approval activity will (dependent upon the amount of DoE support) eat into the $A58m projected balance for end of CY/25.
On FID GLE then needs to put up around 20% of the capex for the PLEF (assuming a USG guaranteed loan for 80% - this is evidently the norm). The cost of the PLEF is estimated to be at least US$1BN (i.e A$1.5Bn) which (at 25%) will cost SLX around A$100m.(for it's 25% of the 20% GLE support funding for the PLEF - their bit NOT covered by the USG guaranteed debt). Thus it would appear to me the capital required to get to start of CY/28 (when the PLEF is complete - it still has to be commissioned - possibly another 6 months to a year before revenue).is at least A$158m (25% of 20% of USin FY/23 money) to support it's contribution to the PLEF funding (assuming that Cameco takes up it's 26% before end of CY/27). See SLX announcements (see
HERE)"
This option can be exercised by Cameco from two years from completion of the transaction (i.e., from January 2023) up until 30 months after the technology is satisfactorily demonstrated at commercial pilot scale (TRL-6) (anticipated to be in the mid-2020’s)."
This means that the Cameco 26% option concludes (assuming TRL/6 success at the end of CY/24) by about July 2027. In the worst case (assuming TRL/6 success by Dec 2024) SLX may not have this money from Cameco if FID for the PLEF is to be at the beginningt of CY/25.
On a more positive note my feeling is that majority ownership of GLE by Cameco will be required to get DoE approval of a USG guaranteed loan for the PLEF debt (only Cameco have the necessary investment grade credit rating) and thus (assuming success of the TRL/6 demo) Cameco will exercise their 26% option prior to FID (around the beginning of CY/25) and SLX will then have the funds to support their 25% of the PLEF capex (and maybe give a capital return/Divvy) to SLX shareholders). However I think it more likely that any surplus on the sale of the 26% of GLE is more likely to support capex on medical isotopes/ZS Si production.after deducting SLX contribution to their upfront funding (i,e 20%) of their 25% of the PLEF.
Just my thoughts.
(20min delay)