Wedoany.com Report-Mar 18, Lotus Resources, through its 85%-owned subsidiary Lotus Africa, has signed a binding uranium offtake agreement with a North American utility.

Lotus is set to begin producing its first uranium from the Kayelekera project in Q3 2025.

This contract involves the sale of 600,000lb of triuranium octoxide (U3O8) from the Kayelekera project, scheduled for delivery between 2026 and 2029.

The agreement reflects a fixed US dollar price based on long-term market prices, with a minor discount applied.

The contract includes a fixed-price escalation percentage per annum, aligned with the Reserve Bank of Australia’s long-term inflation target, applicable from the first delivery year.

This pricing was achieved through competitive discussions, ensuring favourable terms for Lotus Resources.

Lotus managing director Greg Bittar said: “Formalising this offtake arrangement with a key customer is an important milestone for Lotus as we continue to progress production restart plans at Kayelekera towards our Q3 2025 goal.

“Notwithstanding recent weakness in spot prices, our engagement with customers and potential customers, comprising mostly North American utilities, has demonstrated to us the continuing strength in the term contracting market, as uranium customers continue to secure long-term contracts and actively seek to support new supply.”

Additionally, Lotus has formalised a previously announced agreement with Curzon into a “take-or-pay agreement”.

This agreement covers a minimum of 700,000lb of uranium for 2026–29, with potential escalation to one million pounds (mlb) by 2032.

The pricing structure mirrors the fixed-price escalation terms of the North American utility agreement.

These agreements, along with previously announced PSEG Nuclear offtake term sheets, represent the sale of up to 3.2mlb of uranium, with a minimum of 2.9mlb, to be produced at Kayelekera from 2026.

Lotus Resources continues to refine its offtake strategy, prioritising long-term linked prices over spot market reliance to achieve premium pricing with reduced volatility.

Lotus remains actively engaged with potential offtake customers, particularly focusing on North American nuclear power utilities, to secure more substantial volumes of U3O8 from Kayelekera.

The company aims to leverage the ongoing demand for contract pricing based on both fixed and long-term uranium prices, thus minimising its exposure to uncontracted or spot market fluctuations.

Lotus is set to begin producing its first uranium from the Kayelekera project in the third quarter of 2025.