The multi-year uranium forward sales agreement between Madison Metals and Sanmiguel Capital Investment is paying off.
Madison owns an 85% undivided interest in EPL 8531 and 8115 in the Erongo region, where Madison already holds 85% rights to EPL 7011 and has an agreement in place to acquire a 90% interest in mining licence 86A and acquire a 24% direct interest in mining licence 121.
Sanmiguel Capital Investment (Bahamas) Ltd. is a financial advisory firm assisting with the administration.
The parties signed the 10-year deal in May 2023, which commits Madison Metals to deliver the first 20 million pounds of U308 from its Namibian assets to Sanmiguel Capital Investment.
In return, Sanmiguel Capital Investment would facilitate market trades at a price to be determined at the time of the transaction within the market context.
The agreement states that the transaction sales floor would be set at US$45 per pound, with Madison Metals receiving 50%.
In a statement Monday, Madison says it has been receiving funds for its first tranche of the forward sales agreement since November 2023 at an average price of US$65 per pound – US$20 more than the contractual US$45.
Madison Metals says since there is no price ceiling, the sales agreement provides upside potential for advantageous pricing as the market surges.
The company further says given the exceptional performance of the current uranium market, with an 88% spot price increase in 2023 and an additional 10% increase in the first two weeks of 2024, it is well-positioned to leverage these robust market conditions.
Madison Metals CEO Duane Parnham says their strategic mining assets in Namibia, backed by decades of expertise, position them as a leading upstream explorer and developer that can fast-track to uranium production.
“We’re not just creating value for our shareholders; we’re setting the pace for the future of sustainable energy. This is more than a market trend – it’s a fundamental shift in the global energy market. Madison is positioned to be a major player at the heart of it,” Parnham said.
