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Berkeley Energia (BKY) - Retortillo Fully Funded


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Berkeley Energia (BKY) has secured funding for the second stage of development for the Retortillo uranium mine and processing centre, part of the greater Salamanca Project in Spain. The Company has entered into an agreement with the sovereign wealth fund of the Sultanate of Oman (State General Reserve Fund ([SGRF]), who will issue BKY an unsecured interest free loan to the value of US$65m which can be converted into ordinary shares at £0.50 (A$0.82), an 11% premium to the 10-day VWAP. In addition, SGRF will be issued 50.4m unlisted options with a weight average exercise price of £0.85 (A$1.39) over three tranches. The loan will fund final development of the Retortillo uranium mine and processing centre and the options will largely fund the second mine, Zona 7, located ~10 km from the Retortillo plant. Argonaut maintains a BUY recommendation with a $1.70 target price. BKY is the only listed uranium developer globally with near term, large scale production capability. We regard this funding agreement as a creative, low dilution (relative to current pricing) and unencumbering financing solution.   

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