Good morning, ladies and gentlemen, and welcome to the NexGen Energy Year-End and Q4 2023 Conference Call. Note that all lines have been placed on mute to prevent any background noise. After the speakers' remarks, there will be a question-and-answer session at the end. [Operator Instructions] Also note that this call is being recorded. Mr. Leigh Curyer, CEO and Director for NexGen Energy, you may begin your conference.

Thank you, Sylvie, and thank you everyone for joining NexGen's year-end and Q4 2023 financial results conference call. I'm Leigh Curyer, Chief Executive Officer of NexGen Energy, with Travis McPherson, Chief Commercial Officer, and Benjamin Salter, Chief Financial Officer, who are joining me on today's call. I'll provide an update on the exciting progress made this quarter and reiterate the key accomplishments from the past year regarding the rainy market, permitting, project development, financing and for those who have seen the news release this morning, a very exciting discovery of new intense mineralization in a greenfield discovery only 3.5 kilometers from Arrow. After that, we'll move into the Q&A portion of the call. We will make forward-looking statements throughout the call. So please visit our website for the relevant disclaimers. As we collectively navigate the global energy transition, nuclear power has emerged as a pivotal force. It presently accounts for approximately 10% of the global electricity mix with targets set to elevate to 20% to 25% in the coming decades to meet three generational goals, the provision of power for an increasingly energy intensive world, two, decarbonization and, three, providing access to power to those who currently do not have it. The commitment to expanding global nuclear capacity was prevalent at COP28, when NexGen presented on a panel with the Premier of Saskatchewan regarding the province's commitment to sustainably producing uranium to meet the global nuclear requirement. This was further reflected at COP28 where countries pledging to triple nuclear capacity by 2050 acknowledging its essential role in achieving carbon neutrality, ensuring energy reliability and enhancing national security. India recently announced it will be constructing an additional 18 civil nuclear reactors by 2032, aiming to boost its nuclear generation to 2.42 gigawatts, a tripling of its current capacity. Canada supports these…

Thank you, sir. [Operator Instructions] And your first question will be from Katie Lachapelle at Canaccord. Please go ahead.

Hey, good morning guys, and thanks for taking my question. Also, congrats on the new discovery announced this morning. I was just wondering if you could, sorry, Leigh, go ahead.

No, I was just saying thank you. Yeah, we're very excited about it.

That was awesome to see that, especially now that you guys have pivoted back to the regional exploration to show the prospectivity of the land package that you have outside of Arrow. But on Arrow specifically, I was just wondering if you're able to provide any more granularity on the progress that you're going through right now with the federal regulators with respect to the nature of some of the remaining technical questions. As well, when are you expecting to provide a response to those questions?

Yeah. Thanks, Katie. We're really pleased with the report card that we got back on February the 12th from the CNSC. It was effectively an A+. We're down to about 48 remaining items that require a response to the CNSC and we're in the process of triaging those 48 remaining items. And we expect to hand back our responses to those questions and a blackline of the EIS in the coming weeks. So, given the speed of reply, it really does signify the materiality of those questions overall. Whilst every question is very, very important, we assess the materiality of them to be low and will be easily clarified and concluded. So when you consider when you start this process, you've got thousands and thousands of questions if not easily probably about 20,000 aspects to address. We are in the final stages of the process and we also have full community support with respect to our EIS as currently presented and we expect a pretty efficient process here on out with respect to the federal approval.

Awesome, maybe just one follow up. You've obviously made pretty considerable progress with advanced engineering as well as procurement now underway. When, if at all, are you expecting to update the market with revised capital costs as well as operating cost figures? And in your view, are those a requirement to trigger the debt or the potential signing of a long-term contract this year?

Yeah, sure. And so we're in that process at the moment. We are subject to inflation like everyone else in this industry. And the feasibility study of February 2021, we have been impacted by inflation and we are finalizing the exact design scope of the project. Costs have gone up but as we speak, I don't believe that they will have affected the overall after-tax economics of the project. In fact, given the commodity price movement, I would dare say that the payback period has even been shortened from what was presented back in February of 2021. We will be updating the market with respect to those aspects in the second half of this year once that process is concluded.

Awesome. Thank you guys. That's all my questions.

Thank you. Next question will be from Alexander Pearce at the Bank of Montreal. Please go ahead.

Great, thank you. Morning, Leigh. My question is just around obviously permitting and talking about targeting a decision point, maybe in H2 this year. I just wondered in terms of the climate up in Saskatchewan, how much of an impact -- if it is a little bit later in the year, how much of an impact it could have on your kind of critical path timing for first production given, it obviously gets very cold up there?

Yeah, sure. And look, we're very eagerly awaiting the conclusion of this federal permitting process, but, look it is ideal to commence activities during the dry months but it's not an absolute requirement. We can commence the full scale construction at any time during the year. So yeah, it -- certainly it won't be terribly determinant or impactful with respect to when we start, but ultimately, yeah, we would love to be starting the full-scale construction at the earliest point in time. We're ready. We know exactly what we're building. It's well understood by ourselves and also the local community. And we just look forward to the conclusion of this federal permitting process.

Great. Thank you.

Thank you. Next question will be from Craig Hutchison at TD. Please go ahead.

Good morning, guys. Thanks for taking my question. Just with regards to setting up the hearing for the federal government, do they require all the responses to be complete from the information requests or could that be set up in advance of that? And then just can you give us some sort of sense of what the timing is once they've set up that hearing to potentially make a final decision? Thanks.

Yeah, we see that there's -- it's fair enough for us to receive a Commission Hearing Date. We believe the nature of the remaining 48 questions, well not that we believe, we know that the nature of the remaining questions whilst every question is important in an overall context they're determined as fairly immaterial. Whether the CNSC choose to provide a commission hearing date in advance of concluding those 48 or not, time will tell. But we're not, we don't see -- we're not seeking a shortcut or a favor or anything. We respect the process and respect the CNSC had their protocols and procedures in place. I guess what we're expressing is that we feel that we're in the final stages of them completing the EIS review and are in a position to see that commission hearing date as soon as possible. Based on previous companies in this position, that the Commission hearing date has a notice period of three to six months. But every case is different and look, we have met all requirements with respect to the EIS approval process and so the document has been well understood and now in the public forum since November of 2023, sorry November 2022 when it concluded the 120 day public comment period. So look, it's incredibly transparent. All the information is out there for everyone to assess. And so we would expect to be on the shorter end of that notice period once the commission hearing date has been announced.

Okay. Thanks for that. And just, can you give us a sense of what you're planning in terms of budget for exploration and maybe some of the early works that you guys have planned for this year?

Yeah, the 30,000 meters had a budget of $12 million. Obviously, with this new discovery this morning that we announced, look, we're going to be really focusing on that area. So it's safe to expect that the drilling budget will increase over and above that $12 million in 2024 and obviously dependent on results but given we've found an intercept which shows on all fronts is far more exciting than the Arrow discovery hole. We suspect we're going to be there for a decent period of time. So expect that budget to increase, Craig, from $12 million up.

It works, I thought the math as well.

Sorry, just dropped out there, Craig.

Sorry, just wondering the early works, pre-construction works that you guys had planned. Is there's still a bit of a balance left on that, the plans of spending here in 2024?

Yeah. So all the early confirmation works are on budget. We'll have those concluded in [imminently] (ph) near the end of the first quarter here or early in the second. But overall, everything is on budget as we currently speak and we expect it to be on budget for 2024. A lot of the long lead time items have been ordered, and yeah, we've got it well in hand. As I said, everything's ready to really go up a significant notch once the federal approvals are received.

Great. Thank you, guys.

Thank you. Next question will be from Graham Tanaka at Tanaka Capital Management. Please go ahead.

Congratulations, guys, to you and your team. I'd like to focus on Patterson East Corridor discovery. Could you tell us a little bit more about the geologic structure and maybe what implies for the ease or difficulty of replicating an Arrow Rook I development in terms of timing, cost? And then somewhat separately, how would you plan to dovetail a development of the Patterson Quarter East with the Arrow mine development production? Do you anticipate overlapping so that you'll have a rise in production sometime in the next six to eight years? Thanks.

Yeah, thanks, Graham. And they're all absolutely key focuses once we understand what we have at this this new occurrence, 3.5 kilometers almost due east of Arrow, but also at a similar depth to the Arrow mineralization. Look, I think we -- it's still very early days. I just referenced everyone to Figure 3 in the news release. This hole is, like I said, a lot better than the discovery hole at Arrow. What we do know today is that we have 1.5 kilometer strike target for us to investigate. We're seeing a lot of the similarities of the holes in and around Arrow in the holes that were drilled to date. Now it's obviously subject to further drilling as to what we have here. What we can tell you though is that what today's result has confirmed that the Patterson Corridor East is a mineralized corridor similar to Patterson Corridor which hosts Arrow, Cannon, Bow, Harpoon and also RRR owned by Fission to the southwest. So we know we're in a heavily mineralized area. And to give some context to Arrow, and as I said that we've got 3 meters of greater than 61,000 counts per second. So that is incredibly intense mineralization. That's significantly higher than the Arrow discovery hole. We know we're in the right setting, we've hit some very intense mineralization and what we have learned from Arrow is when you get that type of intense mineralization, you know you're near a source and normally, subject to further drilling, a very, very significant source of uranium mineralization. So any discovery of this nature is obviously going to be incredibly accretive to the long-term mine plan of Arrow. In terms of CapEx and OpEx et cetera, again, way too early to determine that until we've done a…

Yeah, I would just, if I could, sorry there's so much here to try to digest. I'm sure even for you. But could you just give us a hint as to the geologic structure and whether the potential mine on PCE, Patterson Corridor East, would be similar to Arrow and therefore also given your applications for approvals for the Arrow Rook I project, can you accelerate the timeline for the development of a second major corridor? Or would it take 10 to 12 years?

Well, what I can tell you based on what we know, I can only tell you what we know at the moment, Graham, and it's exhibiting the holes in and around this new intercept are exhibiting similar metrics, similar style to the setting that is at Arrow. I can't yet quantify exactly what's there and the potential economics. It's 3.5 k's away and it's on land. So any economically assessed deposition within the vicinity of Arrow will be able to be accommodated but subject to obviously permitting of those subsequent deposits. That is to be determined. I think what you can take away based on what we know today is that any economic mineralization within the vicinity of Arrow practically and environmentally would be -- would obviously go through the mine. I think it's way too early to talk about accelerating the development of any new occurrence after so few holes though.

Yep, thank you very much. Good luck.

Thank you.

Next question will be from Brian MacArthur at Raymond James. Please go ahead.

Good morning, thank you for taking my questions. If I can just follow up on the last question, you mentioned material at depth as well. If that turned out to be more economic, which would obviously have to be potentially pretty good, than the new Patterson East, could you do that under the current permit? I guess what I'm trying to get at here is what's actually being permitted now for flexibility, i.e., what else could you bring in in the later years without having to go through a whole process again?

Yeah, well, sorry, thank you, Brian. [Directly under] (ph) Arrow is obviously within the area of influence of the approvals that we're currently pursuing. The practicality of the matter though is that any mine extension goes through a certain process. But anything under Arrow, I think, and in and around Arrow that is subsequently discovered, I think, and you can safely assume will come under the current approval. New occurrence as that 3.5 kilometers on the Patterson Corridor East. Potentially we don't know yet. We need to do many, many assessments around the environmental aspects of it and to ensure that what we're suggesting is consistent with what we've been approved for. If it's not, we would start that work very early on the basis that it does prove to be economic with further drilling. So in summary, based on what we know today and or even before discovery today, anything within an economic distance of Arrow, we would look to augment into the Rook I mill as proposed under the federal approval process we're undergoing.

Great, thanks. And following up just another question, I think you mentioned minor scope change when you were talking -- answering Katie's question about the new CapEx and OpEx. Is that correct? Is there anything major changing there like throughput rate 1,300 to 1,400 tons a day there? Is there anything like that in there or is it just minor adjustments, shall I say, to the construction and things like that?

Yeah, Brian, it's a good question. The mining and milling method has been identical from the very first preliminary economic assessment through the pre-feasibility study and the feasibility study. We are talking exactly the same mining and milling method with some slight improvements in the design to enhance environmental performance over the life of the mine. So nothing material, nothing dramatic, just some improvements around the edges in the long-term interest of the project. That's all.

Great, thanks. Maybe I could ask one more quick. It's great you now got $1.25 billion versus $1.1 billion in commitments. Can you just talk a little bit again about what you need to do? I know you need documentation, but how much you might have to contract, if any, to get that done? You said you'd get it done by the back half of the year, and maybe whether there's been any new people coming in, are they still the same, what I would call international institutions? There are actually utilities and customers coming in at that last $250 million.

Look, I'll start with the first part of that answer then hand over to Travis. The amount of interest that we are receiving every day is increasing. The project's profile from an economic, ESG and green perspective is increasing the number of avenues or sources of potential debt and equity funding for the project. With respect to the percentage required in terms of contracting and offtake, I'll hand over to Travis in a moment. But what we do know from the process to date is that the lenders are very comfortable with us signing volume-based contracts that are tied to spot at the time of delivery in order to service that debt. Travis?

Yeah, exactly. That's the key point, Leigh. And in terms of the quantum and the amount, it will obviously be relatively immaterial to the overall production volumes, given the economics and how quickly it pays back. Obviously, the exact percentage will be determined by the agreed upon, forecasted long-term uranium price predominantly. But again, you're talking about a very immaterial amount of production being volume-based contracted -- or sorry, I should say a requirement to do that anyways by the lenders is, will be a very small percentage of a few years of the first part of production and then everything else is as we want to optimize and determine best for ourselves in the market.

Great, thank you both for answering all my questions.

Thank you, Brian.

Next question will be from Andrew Wong at RBC Capital Markets. Please go ahead.

Hey, good morning. Thanks for taking my questions. Just some questions on contract discussions. I guess first is, could you kind of talk about what kind of customers you're talking to? Is it mostly utilities? Are there intermediaries? What kind of countries or regions are these customers from? And my second question is more around, like, how would you -- how do you plan to incorporate some flexibility around timing of the mine startup? I'd assume there'd be some volume flex, pull forward, push out, obviously there's always uncertainty around mine startup and timing. Can you just talk about that? Thanks.

Yeah, I'll start with that and then also hand over to Travis. With respect to the timing of deliveries, it's very dependent on when we receive the federal permit and we've been very transparent with the utilities in our negotiations that once we have that timing confirmed, we'll be able to get very specific with respect to quantities by certain dates. What the important part of the whole process is, is that we are transitioning this towards a more transparent pricing market, as we've seen in iron ore back in the 2000s and that's been in the interest of both producers and the purchases of the commodity. And our area of focus or utilities that we in advanced discussions with are located in the US, Europe and Japan as we currently speak. We've also got other discussions underway in other parts of the world, but the US, Europe, and Japan are the more advanced negotiations as we speak. Travis?

Yeah, and I might just add, yeah, exactly, Leigh. And we're only speaking with the largest consumers of nuclear fuel in the world in those regions. And what we can tell you is that the approach and philosophy of the company with respect to these volume-based contracts is very much understood and accepted by these counterparties that we're in discussions with. Again, given the fact that not only does it benefit us as producers and future producers, but the utilities themselves in the changing dynamic as we look forward in the uranium markets.

Okay, so I guess -- so let's assume you get the permit, maybe as early as this year, and you could get into construction and everything goes smoothly. It goes into production in 2028, so you sign contracts for delivery starting in 2028, but we never know what happens and anything can come out, like, let's say it gets pushed up to 2029, 2030, like I am just trying to understand on NexGen side, these contracts, is there flexibility for how that works? Like, would you be in a situation where you have to deliver by 2028, for example? Just kind of think around that.

Yeah, well, we're not going to -- sorry, Travis.

No, no, go ahead.

Yeah, Andrew, we're not going to put ourselves in a position that unnecessarily inhibits the optimization or the maximizing the returns on each pound produced. We'll do this in a very conservative nature and as we've done with everything since the company incorporated like our use of capital is extremely efficient. And we always have a very healthy dose of conservatism in the expectations we set. And we deliver against those with respect to the contracting that approach will incorporate all of those disciplines and approaches. So whilst we -- I can't tell you today specifically what the terms and conditions of those contracts are, you can take away that we're going to do it in our traditional, conservative, very careful and disciplined manner.

Okay, that's great. Thank you very much.

Thank you. Next question will be from Chris Thompson at PI Financial. Please go ahead.

Good morning, Leigh and team. Congratulations on this morning's news. Just on that, on the discovery there, I'm just sort of reading through the descriptions. It seems to be largely basement hosted. Is that correct? The mineralization?

Yeah, fully basement hosted. Yeah.

Great. Thanks. And then, and apologies, I might have missed this in an earlier sort of response to a question, but could you give us a sense of the remaining budget for this year, or what is the budget for this year outside of exploration?

So excluding exploration, the budget this year is about $170 million, which is subject to obviously the timing of federal approvals.

Yeah, wonderful. Okay, that's it. Thank you very much, guys. Congratulations again. Thank you.

Thank you.

And at this time, Mr. Curyer, we have no other questions. Please proceed.

Well, thank you everyone. Very much appreciate everyone's interest in NexGen and it's an incredibly exciting time focused on the remaining aspects of the federal approval. As discussed on this call, we are eagerly awaiting conclusion of that process respectfully with taking into account total stakeholder engagement. We have a fantastic project on the cusp of going into construction to meet the world's energy needs and one which will, at the current spot price, will take us into the top nine or top 10 mining companies worldwide on an after-tax cash flow basis. So today to add a new discovery into the story is just incredibly exciting for everyone involved and it really does signify the prospectivity of that dominant land package that we have in the mighty southwestern section of the basin. And so we have a lot of work ahead of us to fully define the true extent of uranium mineralization on our properties. But yeah, the feasibility study on NexGen, I think it's safe for everyone to view that as a base case that this is going to be an incredibly large generational mine which will impact the local communities, Saskatchewan, Canada and the whole world when you consider the impact of the fuel that it will produce. And so with that, we look forward to heading into Q2 and the balance of this year and really delivering on a number of initiatives we have been working on for over 10 years now. And with that, I thank you all for listening and your continued support.

Thank you, sir. Ladies and gentlemen, this does indeed conclude your conference call for today. Once again, thank you for attending. And at this time, we do ask that you please disconnect your lines.