NexGen raises cost of Canadian uranium project to $1.6 billion

Bloomberg News | August 1, 2024 | 

NexGen’s Rook I project. Credit: NexGen Energy

NexGen Energy Ltd. raised the cost to build its flagship uranium mine in northern Canada, citing inflationary pressures and engineering expenses in a remote region.


The company’s Rook I project in Saskatchewan will now cost $1.6 billion, up from an earlier estimate of $940 million, NexGen said in a Thursday statement. Rook I is seen as one of the best uranium projects in development, but the company has yet to secure financing to build it.

NexGen is advancing talks with “various prospective financing entities” including commercial lenders, export credit agencies and alternative sources to secure financing for the project, the company said in the statement. The Vancouver-based firm said it is receiving interest in “significant” new sources of potential project financing.

NexGen is one of several firms racing to develop uranium projects in Saskatchewan’s uranium-rich Athabasca region, which has become a hub of mining activity as the world warms to nuclear power.

While uranium prices have rallied as supply concerns escalate, only a handful of companies actually operate mines for the radioactive metal. Rook I, one of the biggest projects, would account for about 13% of the entire global uranium supply, according to Bank of Nova Scotia.

NexGen shares fell as much as 9.7% on Thursday in Toronto to a low of C$8.31, its biggest intraday decline since May.

Uranium stocks fell broadly following updated guidance from Kazakhstan’s Kazatomprom, the world’s top producer, that indicated it will boost output of the nuclear reactor fuel.

(By Jacob Lorinc)