Nexgen Energy Ltd

TSX:NXE

Earnings Call Analysis

NexGen Energy sees strong demand for uranium as projects progress.

NexGen Energy's recent earnings call highlighted strong demand for uranium due to increasing global consumption, particularly from tech giants recognizing nuclear energy's importance. The Rook I Project is nearing regulatory approvals, with expectations to begin construction shortly after, potentially by mid-2025. Financially, NexGen holds CAD 540 million in cash and CAD 314 million in uranium inventory, positioning the company well for growth. Negotiations for multiple offtake contracts are active, reflecting robust interest from utilities seeking to diversify their uranium supply amidst a tightening market. With a commitment to sustainability and local community involvement, NexGen aims to be a leader in the nuclear energy revival.

A Transformative Shift in Nuclear Energy

NexGen Energy is at a pivotal moment, with significant shifts in the perception of nuclear energy by major tech leaders such as Microsoft, Amazon, and others acknowledging its importance for their future operations. This shift is largely driven by the unprecedented demands of artificial intelligence (AI) and data centers, which require much more power than traditional sources can supply. This growing demand, combined with the instability of current uranium supplies—70% of which is sourced from regions with geopolitical risks—points to an urgent need for Western nations to develop new uranium mines quickly. Market analysts predict a substantial increase in uranium prices due to this supply-demand gap, which is expected to last into the next decade.

Rook I Project Development Progress

NexGen's primary focus is the Rook I Project, which is progressing through the regulatory approval process with the Canadian Nuclear Safety Commission (CNSC). The company is optimistic that remaining approval steps will conclude soon. Once the Environmental Impact Statement is approved, shovels could be in the ground within 60 days, marking the start of major construction. Currently, NexGen is preparing for construction by finalizing contracts, with a strong emphasis on sustainability and community engagement, positioning itself to be a leader in environmentally responsible uranium mining.

Strong Financial Health and Growing Demand

NexGen reported approximately CAD 540 million in cash and CAD 314 million in uranium inventory, providing a solid financial foundation for ongoing operations and future projects. The company is actively engaged in advanced discussions regarding multiple uranium offtake contracts with various global utilities, further demonstrating the strong demand for their future production. The exclusive partnership with WMC, a renowned uranium marketing firm, is expected to enhance NexGen's ability to secure these contracts and further position itself in the competitive energy landscape.

Exciting Exploration Results and Future Plans

NexGen has also achieved notable exploration success with its Patterson Corridor East (PCE), drilling over 34,000 meters and confirming strong mineralization across numerous holes. The discovery is significant as it adds to the company's resource base and bolsters its market position. Plans for the future include continuing similar-sized drilling campaigns in 2025, aiming to expand on this success. The high-grade subdomain at PCE has shown remarkable results, indicating the potential for even greater discoveries.

Community Engagement and Sustainability Initiatives

A cornerstone of NexGen's operations is its commitment to community and environmental sustainability. The company has launched educational and training programs tailored for local populations, ensuring that they gain the skills needed to participate in the workforce as the Rook I project progresses. The recognition received for these initiatives reflects NexGen's dedication to building strong community ties and fostering economic growth within the region.

Future Outlook: Growth and Challenges Ahead

As the global energy landscape evolves, NexGen is exceptionally well-positioned to capitalize on the nuclear resurgence fueled by increasing demand. The finalization of regulatory approvals is critical for NexGen to accelerate construction and start producing uranium when the market necessities heighten. While there are challenges, including the requirement for skilled labor and the need to navigate through complex logistical frameworks, NexGen's strategic planning and foresight contribute positively to a robust future outlook within the uranium sector.

Earnings Call Transcript 2024-Q3

[Operator]

Good morning. My name is Elvis, and I will be your conference operator today. At this time, I would like to welcome everyone to NexGen Energy's Q3 2024 Financial Results Conference Call. [Operator Instructions] Mr. Leigh Curyer, CEO and Director of NexGen Energy, you may begin your conference.

[Leigh Curyer, executive]

Thank you, Elvis. Welcome, and thank you all for joining NexGen Energy's Q3 2024 update and financial call. I'm Leigh Curyer, Chief Executive Officer of NexGen. I'm joined on today's call by Travis McPherson, Chief Commercial Officer; and Benjamin Salter, Chief Financial Officer.

During this call, I will review our key achievements this quarter, including the latest updates from the nuclear industry, as NexGen is witnessing tremendous broad-based support on the demand side with respect to the offtake of our future production.

Further, we will provide updates on the regulatory approval process for the Rook I Project, which is advancing well and nearing conclusion; financial highlights and our ongoing exploration success at Patterson Corridor East announced this morning.

Additionally, I'll provide an update on our sustainability and community initiatives, which remain at the core of our operations, as well as the progress made on project development and project construction financing. Following this, we encourage questions and provide open lines for all participants on today's call. We will make forward-looking statements throughout the call, so please visit our website for the relevant disclaimers.

This quarter marked a transformative shift in how technology leaders view nuclear energy, particularly driven by AI's unprecedented and insatiable power demands. The industry reached a pivotal moment this quarter with major tech leaders, including Microsoft, Alphabet, Amazon, Meta and Oracle; publicly recognizing nuclear energy as critical to their future operations and initiating significant financial deals at a premium to secure long-term power supply.

NVIDIA's CEO, Jensen Huang, whose company is at the forefront of AI development; has been especially vocal about the energy challenges ahead. He emphasize that AI workloads are now demanding power equivalent to that of small nations, creating unprecedented strain on traditional power grids and requiring nuclear energy to supply this growth. This new and exponential growth in demand is on top of the growing demand globally for baseload energy as the world electrifies more broadly.

Further, this demand growth is in the face of tremendous fragility of existing uranium supply, which is currently exhibiting significant sovereign risk, with 70% of the world's mine supply hosted by countries or influenced by countries in military conflict.

The consequence being it is incumbent on Western world countries and their governments to immediately focus and develop multiple new mines into production, incorporating the high regulatory standards to service this demand. Otherwise, it's simple. Lights will turn off, industry and domestic power users, families will experience power shortages.

Reliable cost-effective power is the primary element in the standard of living, and the need for action is now for multiple new mines to be brought online this decade. The current and enlarging demand and supply gap for uranium will result well into the next decade and most likely at materially higher prices than currently marketed.

The broader nuclear landscape continues to evolve favorably. Switzerland reversed its ban on new nuclear builds, japan continued to revive its nuclear fleet, South Korea has returned to pronuclear policies, while India and China are aggressively advancing their nuclear expansion plans with a combined 41 gigawatt under construction between these two nations alone.

September World Nuclear [ Symposium ] saw unprecedented interest and record sold-out attendees. Discussions centered on surging demand, with utilities highlighting power grids at maximum capacity and facing exponential growth from electrification, data centers and artificial intelligence. Multiple utilities alluded to the forthcoming nuclear supply agreements, underscoring the urgency to secure their uranium suppliers and support new mines to diversify the high concentration in the two incumbents.

Turning to the Rook I Project, we continue to make substantial progress on all fronts of our business, which includes detailed engineering, procurement, training and development, uranium marketing, exploration and permitting. With respect to permitting, the most critical step in unlocking the generational opportunities for all of our stakeholders, the Canadian Nuclear Safety Commission, which is the federal nuclear regulator, continues to finalize and conclude the remaining aspects.

We are very confident based on our submissions, which have been 100% formalized support from our projects, local indigenous communities and leaders; the Environmental Impact Statement will be deemed final and the scheduling of the commission hearing and subsequent license decision immediately thereafter.

Our indigenous nation partners are eagerly awaiting the finalization of the federal EIS and the commission hearing as this enables the project to advance through construction, which will unlock game-changing opportunities for our local communities.

Project development activities continued to advance, with strategic focus on critical path items. The mine hoist has been ordered and commencement of fabrication. The shaft award is progressing and the advancement of detailed engineering and procurement. This ensures optimization of the project's critical path and capital spend efficiency to maintain a ready state for construction on receipt of the final CNSC approvals.

This quarter saw the installation and commissioning of a solar power plant at our existing camp, demonstrating one of our commitments to sustainable operations. The [ summer ] site activity, including our gravel-crushing program, has been extended, and we've completed the majority of our 2024 geotechnical field verification program in support of continued detailed engineering activities.

As reported this morning, our PCE drilling, Patterson Corridor East, has delivered exceptional results again with the completion of our 2024 drilling campaign of more than 34,000 meters across the total of 46 holes. Upon initial discovery of the intense mineralization at PCE as reported on March 11 of 2024, we [ redirected ] all drilling activity to focus exclusively on PCE, whereby 19 of 30 holes have now intersected mineralization.

Bold and systematic spacing of drill holes intercepts have quickly grown the discovery from a single hole to a broad and continuous new uranium discovery. Real-time evaluation of results throughout the drilling -- throughout the duration of the program focus on determining the overall [ out ] extent of the ore body and in parallel, precisely targeting high-grade subdomains.

As detailed earlier today, a high-grade portion has now presented itself within the overall mineralized zone of 600 meters strike length and 600 meters of depth extent, with upgraded intensity mineralization in the now best hole to date RK-242022 -- sorry, RK-24-222, a 17-meter wide vein with multiple occurrences of off scale greater than 61,000 counts per second mineralization.

In addition, RK 24-220 and -223 intersected strong mineralization of up to 41,000 CPS and 40,000 CPS, respectively, including multiple intercepts of greater than 10,000 CPS.

System strength is confirmed by these zones, characterized by semi-massive to massive replacement by uraninite. The high-grade subdomain of the mineralized footprint now covers 100 meters of strike extent and 170 meters of depth extent, with potential growth in all directions. The high-grade intersection in RK-24-222 represents the [ fifth ] drill hole at PCE to return off scale of greater than 61,000 counts per second during previous significant intersections in -183, -197, -202 and -207 .

Sustainability, a cornerstone of our operations, is reflected in our transparent engagement platforms, which continue to elevate and set a new standard within Saskatchewan and the broader community, recognized by both regulatory agencies and peer companies.

Over the past quarter, we significantly expanded our community mentorship and education programs. This included engaging more summer students than ever before, after receiving the highest number of applicants in history of our Summer Student Program. Our training and certification programs also expanded, with more than 365 community participants this year alone.

Notably, we launched our Pathways to your Future Career in Mining Program, developed and led by the NexGen team to equip community members with the knowledge and skills to explore career paths and thrive in the uranium mining industry, which is resonating across all ages within the community.

Our continued investment in the community has been further validated with our nomination of several community and industry recognition awards, including being the recipient of the prestigious 2024 ABEX Community Involvement Award from the Saskatchewan Chamber of Commerce, celebrating a business that actively contributes to the betterment of their communities and demonstrates a genuine dedication to making a positive impact in areas that extend beyond the core business function.

This award is reflective of NexGen's innovative and genuine community programs that are contributing to building generational change benefits.

Financially, NexGen maintains a strong position with approximately CAD 540 million in cash and another CAD [ 314 ] million in strategic uranium inventory. Interest from the financial sector has intensified following Climate Week in New York, with 14 global financial institutions signing on to the declaration to triple nuclear energy, which was originally launched at COP28 last year.

Since that announcement, NexGen has seen even more interest in [ lending ] discussions on what will be one of the world's elite mining projects. We are evaluating the many options we have to finance the construction capital, and we'll determine the optimal capital stack on conclusion of the final federal approvals.

NexGen has significant funding options at hand to ultimately construct and operate Rook I whilst maintaining low risk and high leverage to the future prices of uranium.

Development of Rook I for the quarter and 2024 full year focuses on advanced engineering, note, all initial-stage construction programs are fully engineered; procurement of long lead time items, project development, exploration, permitting, community programs and corporate development, whilst maintaining NexGen's industry-leading ratio G&A spend relative to project spending.

[ No ] uranium mineral resource of greater than 300 million pounds worldwide has been discovered and defined through to feasibility level and provincial environmental approval as officially in terms of time and cost on a per pound basis, a direct reflection of NexGen's Board, executive and team culture of elite standards in every aspect of the business.

On the contracting front, following our strategic uranium purchase in May 2024, utility interest and activity increased materially with numerous utility site visits to Rook I over the summer of 2024. We are advancing multiple offtake contract negotiations with various global utilities to demonstrate a very strong demand for NexGen's future production. These discussions are specifically focused on their need for Western world production and diversification. A focus and long-term uranium procurement is intensifying.

Furthermore, we have established an exclusive relationship with [ WMC ], a highly experienced and successfully uranium marketing firm, who is now exclusively marketing only for NexGen. [ WMC's ] alignment on NexGen's unique industry positioning and correlated marketing approach will further enhance NexGen's key role in the energy transition.

In order to meet demand, the market needs new discoveries. The projects [ known ] being restarted and expanded would not be enough. In fact, multiple new Rook I site projects must be discovered, permitted, financed and constructed in the coming years.

There are currently less than a handful of projects globally in Tier 1 jurisdictions capable of reaching any level of production within the next decade. This scarcity of new projects makes our recent exploration success at Patterson Corridor East all the more significant, with the Southwestern section of Athabasca Basin presenting itself as the epicenter of future Western world mined uranium.

Looking ahead, we have several exciting and highly material catalysts on the horizon, including the financial -- the finalization of the Federal Environmental Assessment technical review and the commission hearing. NexGen is exceptionally well positioned to lead the nuclear energy resurgence, with Rook I representing the largest and highest-quality environmentally sensible uranium project globally in the Tier 1 jurisdiction.

Our unique position at Canada's Athabasca Basin is the attracting utilities seeking to diversify supply chains and reduce geographical concentration risk, a crucial advantage in today's geopolitical climate. Our commitment to excellence in all aspects of development, coupled with our robust financial position and unwavering focus on sustainability, including our people, will continue to set us apart as we work to deliver this generational project.

I now hand over to the operator to answer any questions.

[Operator]

[Operator Instructions] Our first question comes from Alex Pearce from BMO U.K.

[Alexander Pearce, analyst]

I was just hoping you could give us a little bit more detail on which areas within the review process is still under scrutiny. And then let's say, assuming the EIS is approved on the 19th, which, I think, is the next deadline; what's your current estimate when you could get shovels in the ground for the main domain project?

[Leigh Curyer, executive]

Yes, sure. So Alex, we had an update as recently as late last week. There are no issues presented to us, as we are currently made aware. We understand also that there's very few aspects left to conclude and that the CNSC is working very diligently on the conclusion of those aspects.

Now as I've often stated, we are incredibly respectful of the process. And it's one of the reasons why we chose Canada because it's highly regulated and -- as uranium mining should be. But we are nearing the final conclusion of that. The 49 aspects that they required additional information on, has been publicly released by the CNSC. But we are very, very confident, based on that meeting last week, that the process is nearing conclusion. And they'll be the first to notify the company when that occurs.

From there, a commission hearing date will be set. And then the process is that it's 60 days for final signing by the Federal Minister, at which point, after that, shovels will be able to go on the ground.

[Alexander Pearce, analyst]

And then maybe I can ask a second question, which is you flagged in your remarks, obviously, your discussions with utilities are ongoing about future offtakes. We're seeing, at least from some of the reporting agencies, there's been a bit of a slowdown since, let's say, the WNA. I just wondered whether you can just talk about how you've seen discussions changed over the last month. Are you also seeing a slowdown in terms of a need for future contracts?

[Leigh Curyer, executive]

Yes. Look, Alex, I can only speak to what we're experiencing. It's been quite the opposite. We're actively engaged on a number of offtake agreements with multiple utilities globally. So no, we personally haven't experienced that at all.

[Operator]

Our next question comes from Orest Wowkodaw from Scotiabank Toronto Canada.

[Orest Wowkodaw, analyst]

My questions are sort of more of the same as Alex'. Leigh, of the 49 sort of outstanding questions that were -- that you mentioned earlier, how many of those are still outstanding as of today?

[Leigh Curyer, executive]

As of today. Well, I can't tell you simply which ones are outstanding, except to say that the CNSC have indicated that they're nearing conclusion of the process. And we have not been notified of any outstanding issues or seeking additional information, as I speak. So look, it's a process where the CNSC and the company will share information and look to conclude and close out certain aspects.

What I can say overall is that it's been indicated to us that the process is nearing conclusion. And we're very confident, based on the responses that we have given, that it will be concluded in the very near future.

So I can't give a date and -- or a specific number of where that process is, out of respect to the CNSC in conducting their process. But I take it on face value that the process is very close to conclusion in terms of those 49 aspects being closed out. And we very much look forward to that and then the commission hearing date being set.

Look, the community in the project area are obviously closely involved in the whole process and the meaning of that for them as a community. And it was conveyed to me by one of the community chiefs late last week that they are very interested in having this process concluded in the very near future.

So there's a number of stakeholders, including the province of Saskatchewan, who are of the same view. But ultimately, all of us is very respectful of the federal CNSC process concluding in the appropriate manner, and we understand that to be in the very near future.

[Orest Wowkodaw, analyst]

And Leigh, just on the timing, like assuming you do get the final sign-off on the EIS, say, at the end of the year, are we talking like 60 to 90 days to set a hearing date and then 60 days post that hearing date? Like is that -- sort of are we talking more like mid-'25 now for kind of realistic timing of construction ready?

[Leigh Curyer, executive]

Well, it's totally at the discretion of the CNSC, and I respect that. I don't have a timeline on it, I understand everyone's and our own. We would like it to be as soon as it can be, respecting everything that needs to occur prior to that commission hearing date. We're not looking for a shortcut or anything in that respect.

So we respect the CNSC's discretion in setting that date. I think the CNSC is well aware of all the stakeholders desire to have that as soon as it practically can be respecting the CNSC's processes. And we are ready for it as a company, as a community, as a province to have that commission hearing and then have it finalized in order to commence construction.

[Operator]

Our next question comes from Andrew Wong from RBC Capital Markets.

[Andrew Wong, analyst]

Just given the increased interest from utilities, I'm just wondering, does that give you more line of sight on signing an offtake contract this year? And does that process hinge on the approvals process moving forward?

[Travis McPherson, executive]

No, it doesn't end on the...

[Leigh Curyer, executive]

Yes. Travis.

[Travis McPherson, executive]

Yes. It doesn't hinge on the permitting approvals necessarily. But we are negotiating them and in final negotiations on a number of them. Obviously, it's always hard to pin down an exact timing of signing anything you're negotiating, frankly. But obviously, extremely motivated parties on their side and on our side, so -- and there's no issues or anything, and it's very advanced.

So yes, it seems completely reasonable that we will execute and announce potentially a number of contracts before the end of the year.

[Andrew Wong, analyst]

Okay. And do you have enough physical uranium available to backstop those contracts? And just given that uranium prices have come down recently, do you see that as an opportunity to maybe add to your current inventory?

[Travis McPherson, executive]

It's a good question, Andrew. I would say, answering your question in order, no, we're satisfied with the amount that we have. We don't see a need to buy it. Again, when we bought it originally, there wasn't -- we're not like timing the market and trying to trade the market. So uranium prices coming down, going up, frankly, doesn't really change the rationale for doing that transaction or any future transactions with that uranium.

The uranium has proven to be very useful in these discussions that we're having, particularly with a few counterparties that are as used to supporting a new mine because, frankly, there hasn't been a new mine in uranium in a couple of decades, at least one that's material. So, it's proven to be very helpful in those negotiations. And so yes, we're satisfied with how much uranium we have and aren't looking to purchase anymore.

[Leigh Curyer, executive]

Yes. And Alex -- sorry, Andrew, I think it's two factors. One, the market and the way it's evolving, but also the recognition by the utilities of where NexGen is in the permitting process and that it is nearing finalization. So I think it's a number of factors which has increased that activity with respect to those negotiations, specifically with NexGen.

[Operator]

Our next question comes from Puneet Singh from Eight Capital.

[Puneet Singh, analyst]

Saw that in the [ US ] Weekly, where [ WMC ] was touting being brought on as your exclusive partner, and you had mentioned in the opening remarks as well. I know they do some work with the Sprott Trust. But maybe touch on that decision to bring them on and talk about how that could be a strategic advantage for you guys.

[Leigh Curyer, executive]

Yes. I might start and let Travis take over. But look, [ WMC ] are highly qualified and experienced in the uranium marketing industry worldwide. They approached us, wanted to become our exclusive marketing arm for the offtake of NexGen Rook I Project.

I think that reflects a couple of things. One, they identify with our position and approach to the marketing of offtake. They have fantastic long-standing relationships with all the major utilities. And I just think that's -- it's an excellent reflection on where we are as a company and where we're heading.

Also, with -- yes, they have purchased uranium for Sprott Uranium Trust. There's no relationship between NexGen or the Sprott Uranium Trust. So I just want to be clear on that. The arrangement is to exclusively market offtake on behalf of NexGen from the Rook I Project. We're very excited about it, for obvious reasons. As I said, I think it reflects our position in the market, but also about our approach to the future marketing of the uranium.

[Operator]

Our next question comes from Craig Hutchison from TD Cowen.

[Craig Hutchison, analyst]

Just one follow-up on the permitting front. Do you guys know at this point whether the hearing -- the commission hearings will be a one-part hearing or two-part hearing? Have they given you any sense on that at this stage? Or is it too early?

[Leigh Curyer, executive]

No. No. They've indicated that it will be both the permitting and the licensing concurrently.

[Craig Hutchison, analyst]

Concurrently, okay, great. And then just on the exploration front, can you just give us a sense of what the turnaround time is on assay results? I think you guys mentioned you expect some assays in the fourth quarter and next year. And what's sort of the plan in terms of meterage for drilling next year?

[Leigh Curyer, executive]

Yes, sure. So look, we batch the assays. And considering that it is a -- occurring in parallel to the development activities at Rook I Arrow with the confirmation of the geotechnical setting, we have been batching the assays. So we're not sending in 1 hole to the lab after each hole, we're doing batches. And so it will be a bit lumpy with respect to the way those assays come back.

The other aspect, too, is -- look, the scintillometer gives us a very good feel, and we're at the stage of just identifying the area of mineralization and looking for the interior high-grade domains.

Now we still haven't defined the outer limits of the mineralization, nor the high-grade subdomains within that. So the -- we want to understand that first. And then we have batched and sent the core to the lab, and those will be coming in during Q4. But yes, I just want to make the point that where it's not one hole, send the hole to the lab, we're batching them, and we'll report them in batches as they come in.

So that's happening. I think you'll see a very similar size program. The 34,000 meters at PCE was the largest in the entire Athabasca Basin for 2024. Based on what we see today, I would say that at a minimum will be around that many meters plus probably some more, dependent on other results. But this is an incredible discovery, only 3.5 kilometers from the Arrow deposit, entirely contained within the basement rock and at the same time, exhibiting greater off scale than what we saw at Arrow.

So, we are incredibly excited about it. But when we are running -- we haven't been distracted with it in terms of we are very focused on the permitting and development of Arrow. And this running in parallel and the background is incredibly exciting for everyone involved, not just the people at the company, but also the community, the province as well. So it's an incredible development. Has presented itself only earlier this year, so we -- it's very early stages, but looking incredibly exciting.

[Operator]

Our next question comes from Katie Lachapelle from Canaccord Genuity.

[Katie Lachapelle, analyst]

It's nice to see another positive update on the drilling. I do want to go back to sort of the offtake negotiations that are underway and the [ WMC ] energy agreement. What has been the sort of response that you've received from utilities on the back of that? And have you seen some of the contract negotiations, I would say, improve or evolve since bringing in [ WMC ]?

And then maybe one follow-up as well, I'm not sure if you can answer this. But if there were to be some sort of change of control or something at the company level, is [ WMC ] guaranteed that agreement going forward? Or is there something in place where that could potentially fall out?

[Leigh Curyer, executive]

Yes. Travis, go ahead.

[Travis McPherson, executive]

I was just going to say, yes, no, everything was progressing very well prior to [ WMC ] coming on. [ WMC ] obviously has the infrastructure in place as well as expanded long-standing relationships across the whole globe, frankly, with respect to that. I would say that, yes, NexGen was progressing these offtakes on a stand-alone basis, this has added to it.

So I think natural progression hard to say on these first few contracts. I don't think anything would have materially changed as a result of bringing WMC on. But for sure, as you look ahead and as we expand, the reception to us announcing bringing them on, unanimously positive, which I think speaks to both WMC's reputation in the industry as well as NexGen's and then that combination of alignment.

And then with respect to the change of control provisions, I would say -- without getting those specifics, I would say they're fairly standard for this type of contract and would not necessarily live on through in perpetuity.

[Katie Lachapelle, analyst]

Got it. Maybe one more question for me and sort of pivoting. On the shaft award, you said that's still progressing. It felt like a couple of months ago, that felt like it was imminent. So I'm wondering -- I don't want to say there's a delay, but what's been leading to sort of the awarding of the shaft taking a little bit longer than maybe previously expected?

[Leigh Curyer, executive]

Nothing -- sorry, Travis.

[Travis McPherson, executive]

No, no, go ahead.

[Leigh Curyer, executive]

Yes. Look, nothing other than it's taken time. Look, it's a massive contract. And we -- taking many review hours, et cetera. And that's just a function of how material that contract is to the overall construction schedule. The other aspect, too, is that we are awaiting final approval. So we can't really launch into any major construction until final approvals and ministerial sign-off. So yes, nothing, other than that.

And I'll just say also, just add to the thing about [ WMC ], we are very focused on executing this project. And by virtue of the volume of inbound calls we were getting, it just made sense to work with [ WMC ] to do that in a manner in which it deserves. And as Travis said, they've got exposure across the entire globe. And we are incredibly pleased to be working with them.

[Travis McPherson, executive]

And Katie, I might just add on the shaft side of it as well. Like -- these large contracts like this, there would be like phases. And so we have advanced through a limited notice to proceed on those critical path, detailed engineering and procurement phase of that contract. So notwithstanding the fact that the whole contract is not executed, you do advance under the early phases of what will become those contracts. So everything on the critical path with respect to the shafts is maintained, despite this contract not being fully executed as of yet.

[Operator]

Our next question comes from Mohamed Sidibe, from the National Bank of Canada.

[Mohamed Sidibe, analyst]

So just on the uptake on -- I think you mentioned interest from utilities globally, but I just wanted to understand, given various announcement of maybe contracting being slower than expected this year, are you seeing particular interest from a specific jurisdiction? And from your point of view, are you really more focused on supplying a specific jurisdiction like North America or really open to uptakes from anywhere in the world?

[Travis McPherson, executive]

Yes. Thanks, Mohamed. I would say there's 3 primary jurisdictions that have been the early focus anyways, which has been North America, so Canada and the U.S., and then as well as Western Europe and Japan. We are speaking to effectively everyone around the world, but I would say that those are the most advanced. And so we're kind of just going with that.

I think yes -- well, from a -- if we could choose how it gets split up in terms of -- yes, I think, obviously, times [ wise ] and where the asset is, of course, North America should and likely will have a heavy focus. But yes, we'll sell to anyone that's aligned with us and we're legally allowed to sell to. But those would be the primary 3 jurisdictions that have shown tremendous interest over the last couple of years.

[Mohamed Sidibe, analyst]

And just my second and final question here, just on the financing portion and the express of interest that you had and maybe timing, I think last time we chatted, you said that it would be post permitting approval that we could see an announcement on the financing front. Is that still the case? Or could we see something prior to maybe a commission hearing date being finalized?

[Travis McPherson, executive]

Yes, we could -- we're targeting -- obviously, it's a bit of a moving target because we don't know exactly when the commission hearing day will be. Obviously, a lot has been spoken to about that. But we don't know exactly where that is. Obviously, every focus and energy is on making sure that that's as expedient as it can possibly be. But we don't know when that is. So we're advancing this [ debt ] and overall project financing options, of which there are many, altogether.

And so, yes, there's a chance that, that can get finalized ahead of that. But again, it just depends on when that commission hearing date exactly is relative to how these things progress in advance. But we want to be at a decision point, for sure, kind of around the point of that commission hearing with our own internal estimates of kind of potentially when that hearing could be.

[Leigh Curyer, executive]

Yes. Obviously, the conclusion of the federal permitting process is the main gate to be offtake bit, construction financing finalized, all of these things are getting run in parallel, but are effectively dependent on that final federal approval process concluding.

The fact that we haven't concluded the debt to date, even though we have been in a position to, has resulted in more avenues of financing. And as this market continues to evolve, we are ensuring that we will take the most optimal package available that maintains leverage to the future prices of uranium.

We have a very, very simple story. We have a very large, very high-grade project in the best jurisdiction to develop and operate a uranium mine in Saskatchewan, Canada, right next door to the biggest nuclear fuel market in the world in the U.S. And we're incorporating elite environmental standards and community participation and engagement.

So we have a very simple story. And hence, we're attracting a lot of interest, be it from offtake or debt or financing providers. And the big gate to that is concluding this federal permitting process. And we are confident that, that is imminent, whilst respecting the CNSC process to conclude.

[Operator]

Our next question comes from [ Aaron Chang ].

[Unknown Analyst]

Thank you for this comprehensive summary of all the recent transformative [ uses ] across all aspects really of NexGen. With these exciting prospects of future projects in development and what sounds like really limitless potential and demand, there are a lot of questions I'd actually love to explore in more depth. But I'm going to hone in on a pretty functional logistics.

Given the unprecedented pioneering nature of your projects, I wonder about the workforce driving the execution of these projects, the adequate supply of skilled labor workforce, does that present a risk to project progress and timeline? Is there a real obstacle?

I've seen how it is in other significant projects in the energy sector. And considering the complexity and scope of projects and end-to-end timelines from shovels in the ground to product in the marketplace, how robust is this skilled workforce pipeline?

And the other challenge I hear a lot about in project execution in the energy sector is in supply chain delay for parts and components related to the engineering and infrastructure projects. So I'm really just wondering about these logistics. And to what extent are these projects are exposed to those risks as well?

[Leigh Curyer, executive]

And that's an incredibly relevant question. Those two aspects, you've got to look at two things. One, the technical nature of the asset. We have a very, very -- in a mining sense, very simple mine. We're in competent basement rock. It's shallow. And we'll be moving ore of 1,300 tonnes a day. It's actually one of the world's tiniest hard rock underground mines. So we're in a very technical -- simple technical setting and environmental setting.

The other aspect with respect to labor forces and delays is the way the company manages the execution of the project. Now we have been a lead in our project execution since inception.

And when it comes to the labor, we have a community 150 kilometers from the project of 4,500 people. We've been there since 2011. And we have run a number of programs starting back in 2022 with a very enthusiastic community and working with the various technical colleges in Saskatchewan, in a number of job skill programs to ensure that, that community has the access to the jobs at Rook I and appropriately qualified.

Now, a lot of those people who have gone through our programs, are now currently working in other parts of Canada, but can't wait to come back once the project is approved and construction commences.

So we've recognized this many years out, and we've been working towards it since we made the decision to go to develop this mine back in 2017. And so as we speak, we're very, very pleased with where we are with respect to that training and the availability of the appropriately qualified labor, which will -- which does exist in the local community.

And as a philosophy, our company, we want our workers living as close to the project in the local community as possible. And it's going to be another example of successful partnership, collaboration between the company and community and the successful execution of the resources project.

So your question is incredibly valid, one which we have been aware of and planning for since 2017. And the success of those programs, which I touched on earlier in our call, are having an excellent impact, as we speak.

So, on top of that, the nature of the project and the culture of the company has been attracting elite talent from around the world. We have a very strong perspective on this line -- on this mine being the most environmentally well-managed mine globally, and that's a function of its natural technical setting, but also the design aspects that we've chosen to incorporate. The underground [ tailings ] management facility is one of them.

And so we're really pleased with where we stand currently for our level of activity, and we're prepared for the next stages, once they are approved, to move forward in a sustainable and sensible manner.

[Unknown Analyst]

And you also touched on my second question, which was going to be about that initiative that you're already implementing in the community. So thank you for segueing naturally into that.

[Operator]

There are no further questions at this time. Ladies and gentlemen, this concludes the conference call for today. We thank you for participating and ask that you please disconnect your lines.