NexGen Energy Q2 Earnings Call Highlights

Key Points

• Rook I construction remains on schedule and within budget: NexGen completed key milestones, including commissioning a 3,000-foot airstrip and occupying its accommodation complex. The company has not materially changed its C$2.2 billion construction estimate, with shaft sinking targeted for early 2027.
• Funding and uranium sales efforts are advancing: NexGen ended Q2 with C$970 million in liquidity and is evaluating project financing, government support, strategic transactions and uranium prepayments. It has contracted 11.3 million pounds and is seeking agreements that preserve exposure to future uranium prices.
• Exploration at Patterson Corridor East continues: About half of the planned 42,000-meter drilling program has been completed, with another 20,000 meters expected by year-end. The work is aimed at expanding the discovery and defining high-grade zones ahead of a potential resource estimate.

NexGen Energy NYSE: NXE said construction activities at its Rook I uranium project in Saskatchewan advanced on schedule and within budget during the second quarter of 2026, as the company continued to pursue uranium sales agreements and evaluate financing options for the project’s remaining construction needs.

Founder and Chief Executive Officer Leigh Curyer said NexGen had completed its planned construction milestones during the quarter. The company commissioned a 3,000-foot airstrip, completed and occupied its accommodation complex, and continued major earthworks and surface-infrastructure work. NexGen said the site workforce totaled about 300 people and was growing as construction activity accelerated.

The company said the airstrip is expected to be extended to 5,840 feet by December 2026. During the remainder of the year, work is expected to focus heavily on earthworks, including preparation for shaft sinking scheduled to begin in the first quarter of 2027. NexGen expects to begin concrete foundations for shaft headframes, a hoist house and a winch house in the fourth quarter, along with installation of a temporary freezing plant and construction of a primary batch plant.

Construction Costs and Project Execution

Responding to an analyst question on capital-cost inflation, Curyer said the company had not identified any material change to its August 2024 construction-cost estimate of C$2.2 billion. He said NexGen had recently signed its shaft-sinking and underground-engineering contract, which represents more than half of the project build, at levels in line with the prior estimate.

“To date, we have not seen anything material in that move, in that C$2.2 billion guidance,” Curyer said, adding that the contract includes incentives tied to shaft-sinking development rates.

Chris Copley, NexGen’s director of engineering, said confirmation drilling had validated prior assumptions for the shaft-freezing program. He said the company expects freezing to begin in early 2027, followed by pre-sinking by the middle of that year. Copley also said dry-mix and wet-mix batch plants are being prepared for the site to support foundation work and other construction activities.

Curyer said NexGen had C$970 million of liquidity at the end of the second quarter and that the heaviest project spending is not expected to begin until February and March 2027. He said expenditures currently being made on Rook I are being deducted from the C$2.2 billion construction estimate.

Uranium Contracting Strategy

NexGen said it executed a term sheet during the quarter to sell an additional 1.3 million pounds of uranium to a U.S. utility customer. Curyer described the agreement as a short-duration arrangement priced at market levels at the time of delivery, intended to establish a longer-term customer relationship.

The company said it has 11.3 million pounds contracted and is negotiating additional agreements with utilities in the U.S., Asia and Europe, including one potential agreement covering up to 20 million pounds. Curyer emphasized that the latest 1.3 million-pound agreement should not be viewed as a template for future contract volumes or durations.

Instead, management said its primary commercial objective is to preserve exposure to uranium prices at the time of delivery. Curyer said NexGen’s contracts are structured differently by customer and can reference spot uranium prices, rolling spot-price averages, and potentially three- or five-year market pricing. The company said 96% of its reserve base remains available for future sales.

NexGen reiterated that its approximate break-even contracting level is 3.7 million pounds annually. Curyer said that even at that level, the company would retain 26.3 million pounds of annual production exposure to future uranium prices.

The company cited TradeTech pricing data showing uranium’s term market reached $97 per pound during the quarter, while the five-year forward price stood at $105 per pound. Curyer said the spot price had consolidated in the mid-$80s per pound.

Funding Options and Government Interest

Management said NexGen is considering several options to fund the remaining construction capital, including project financing, strategic corporate or asset-level transactions, government support and prepayments for future uranium deliveries.

Chief Commercial Officer Travis McPherson said there is interest from Canadian and U.S. government-related sources, as well as other parties, in supporting Rook I. He did not identify specific agencies, amounts or potential timelines.

Curyer said discussions regarding uranium prepayments have been positive and could preserve price exposure through structures in which the number of pounds delivered changes depending on uranium prices. He said a hypothetical 10 million-pound prepayment at an $85-per-pound price would amount to $850 million, though he stressed NexGen is not seeking to fix uranium prices at that level.

Exploration at Patterson Corridor East

NexGen said approximately half of its planned 42,000-meter drilling program at the Patterson Corridor East, or PCE, discovery had been completed. The company plans to drill roughly 20,000 additional meters through the remainder of 2026, with some drilling also planned at the SW3 target.

Curyer said the program is focused on expanding the mineralized footprint and defining high-grade subdomains. NexGen expects to release scintillometer results from recent drilling in batches in the coming months, while assay reporting will depend on laboratory processing capacity. He said the timing of a potential resource estimate for PCE will depend on the results and the extent of additional drilling needed to define the discovery.

The company plans to hold an Investor Day webinar in early September to provide a more detailed update on the Rook I construction pathway and project team.

About NexGen Energy (NYSE:NXE)

NexGen Energy is a Canada-based uranium exploration and development company focused on advancing its flagship Rook I project in the Athabasca Basin of northern Saskatchewan. The company's primary activities include resource delineation, feasibility studies, and permitting for its high-grade Arrow deposit, one of the largest undeveloped uranium discoveries in the region. NexGen's technical team employs advanced drilling, geophysical and geochemical techniques to expand and define its resource base, with the aim of delivering a robust, low-cost supply of uranium to global nuclear power markets.

The Rook I project sits within one of the world's most prolific uranium districts, offering excellent infrastructure access, a skilled local workforce and a supportive regulatory regime.

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