Uranium Energy Corp. ($UEC)

Good day, and welcome to the Uranium Energy Corp.'s Third Quarter Earnings Conference Call. [Operator Instructions] Please note this event is being recorded. I would now like to turn the conference over to Amir Adnani, Uranium Energy Corp.'s Founder and CEO. Please go ahead.

Thank you, operator, and good morning, everyone. A presentation accompanying today's call is available on our website. Some of the commentary today will include forward-looking statements, and I would encourage everyone to review the cautionary language on Slide 2 of the presentation. With that, let's begin with highlights from the quarter. This quarter was marked by several defining milestones along the continued execution of our long-term strategy to become America's first and only vertically-integrated uranium company from mining and processing through refining and conversion. We are also pleased to provide an update on our critical mineral portfolio. The commencement of production at Burke Hollow is a significant achievement for UEC and an important milestone for domestic uranium production in the United States. It is the largest greenfield ISR uranium project to come into production in more than a decade. It has been incredible to see our team develop the project from a grassroots discovery in 2012 to production in 2026. Let that sink in for a moment. It took 14 years to bring a new uranium mine online. That time line highlights the scarcity and strategic value of fully permitted and operating uranium mines, not only in the United States but globally. It also underscores a significant competitive advantage for UEC, which today controls permitted uranium projects in the U.S. We are very proud of our team's efforts and accomplishments over the past 14 years to advance Burke Hollow. In addition, we would like to thank our landowner and stakeholders for their support. Building on the scale of our asset base, we are now operating 2 of our 3 U.S. hub-and-spoke ISR production platforms. We control the largest uranium resource base in the United States, which provides the foundation for decades of staged production growth. Our strong balance sheet and inventory position with no debt provides us with the opportunity to pursue our 100% unhedged strategy, selling opportunistically and capturing industry-leading realized pricing, generating meaningful returns for shareholders. Through our wholly-owned subsidiary, United States Uranium Refining and Conversion Corp., we have created maximum alignment with the renewed bipartisan focus on energy independence and national security in the U.S. This opportunity positions UEC as the only American vertically-integrated nuclear fuel supplier from mining through conversion as nuclear power expands and fuel sourcing ships back onshore. With policy momentum building and long-term uranium supply gaps growing, we are strategically placed at the convergence of market demand and government priorities. With that overview, let's turn to operational highlights. In the third quarter, our focus remained on expanding production capacity while maintaining a low-cost production profile. As I highlighted, commencing production at Burke Hollow was a significant achievement. Burke Hollow is an important part of UEC's growth strategy, allowing us to initiate production at our second hub-and-spoke platform anchored by the Hobson central processing plant. At Christenson Ranch, we received regulatory approval for expanded production, adding an additional 3 header houses at the end of March. With these approvals now in hand, we anticipate increased production rates in the fourth fiscal quarter. We have an additional 5 header houses under construction and 1 additional Header House has been completed and is on standby for regulatory approval. During the quarter, 32,000 pounds of uranium concentrate were produced at a total cost of pound of $54.61, including a cash cost per pound of $46.69. Cost per pound did increase during the quarter, but we view this as a temporary and largely a timing-related event. Regulatory approvals delayed production from new header houses, while costs associated with bringing those production areas online were incurred before the associated uranium production was fully reflected in quarterly volumes. Given the sensitivity of unit cost to production rates during this stage of the ramp-up, together with higher state taxes, these factors increased cost per pound during the quarter as production rates increase from the newly commissioned header houses, we expect cost per pound to improve. Since commissioning, UEC's total cost per pound remains a leader in the domestic industry at $39.30 including a cash cost per pound of $32.40 across 276,000 pounds produced. At Ludeman, our next planned ISR uranium operation in Wyoming, we completed a 240 hole delineation drilling program at Sweetwater, our stored hub-and-spoke production platform anchored by the Sweetwater mill. We completed a 200 hole delineation drilling program in the first 2 planned well fields at Roughrider, our development stage conventional asset located in the Athabasca Basin in Northern Saskatchewan, core drilling is over 80% complete to support our planned prefeasibility study. A key component of our long-term strategy is the United States Uranium Refining & Conversion Corp., or UR&C. Uranium conversion remains an acute bottleneck in the Western nuclear fuel cycle with insufficient commercial UF6 capacity outside Russia and China. At the same time, a critical gap in the U.S. nuclear fuel cycle is the lack of a vertically-integrated domestic supplier, spanning mining, processing, refining and conversion. That gap underscores the importance of UEC's initiative with UR&C. During the quarter, we made important strides to advance the project. We achieved our first U.S. Nuclear Regulatory Commission licensing milestone through receipt of a docket number. Further, ongoing discussions with the U.S. Department of Energy regarding strategic nuclear fuel cycle infrastructure led us to add additional candidate locations to ensure coordination and alignment with federal priorities for restoring domestic uranium conversion capacity and strengthening America's nuclear fuel supply chain. We have now developed a final short list of candidate locations. Finally, we're excited to spotlight a recent update for one of our critical mineral projects, Alto Parana in Paraguay. A recent completed independent report determined that the project represents a globally significant critical minerals platform with the potential to materially contribute to the security and diversification of U.S. supply chains for titanium and vanadium. UEC's critical minerals portfolio, which includes the West Bar cobalt nickel project in Canada, has been assembled through timely acquisitions over the last decade and represents additional embedded value that we will look to unlock for shareholders through ongoing initiatives. This strategy and component of our business aligns with the urgent need of reestablishing critical mineral supplies in support of national and economic security. Now turning to our financial position. We finished the quarter with $794 million in liquid assets, including $488 million in cash, along with uranium inventory and equities and importantly, no debt. As of April 30, 2026, we held 1.4 million pounds of U308 valued at approximately $127 million at current market prices. Excluding the additional approximately 277,000 pounds of precipitated uranium and dried and drummed U308 held at the Irigaray central processing plant. USD's balance sheet, combined with our unique unhedged strategy provides the flexibility to be selective in the execution of sales as demonstrated in the third quarter where we preserved our inventory. As many are familiar, our operational platform is built around scalable hub-and-spoke ISR operations in Wyoming and South Texas, supported by longer-term development projects at Sweetwater and Roughrider. Starting in Wyoming. Through our ongoing construction campaigns, we continue to scale production at Christensen Ranch which operates as the first spoke to the Irigaray CPP. As of April 30, 2026, total cumulative production from Christiansen Ranch since restart was approximately GBP 277,000 of precipitated uranium and dried and drummed U308 at the Irigaray CPP at a total cost per pound of $39.30 including a cash cost per pound of $32.40. The company continued to develop new production areas at Christiansen Ranch during the quarter. Turning to Ludeman, US's next planned ISR operation. The previously announced 240-hole delineation drilling program was completed. This work will assist wellfield pattern design currently underway. Engineering of the satellite ion exchange plant progressed with the planned layout and pad design, largely finalized and fabrication of the ion exchange vessels ahead of schedule. We continue to advance the remainder of the mechanical equipment specifications, which allows the company to begin to procurement process for longer lead time equipment. Turning to South Texas. We commenced production at the Burke Hollow project on April 8, 2026, in order to initiate the uranium recovery process, oxygen and carbon dioxide were injected into the wellfield and will provide initial feed to the Ion Exchange plant. The satellite ion exchange plant was commissioned and wellfield development continues in Phase 1a. Now that it is online, we expect to see production from Bucalo accounted for in the fiscal fourth quarter of 2026. Looking further ahead towards our development stage assets, Sweetwater is earmarked to be a major future production center, and we are working expeditiously towards this operation as both a conventional mill and a central plant for processing ISR production. Further, a 200-hole delineation drilling program in the first 2 planned wellfields at Sweetwater commenced in March and was completed in early May. A second 200-hole delineation drilling program is scheduled to begin in July 2026 where the third ISR well field at Sweetwater is planned. Finally, the ion-exchange vessels for the Sweetwater ISR circuit are under construction. In Saskatchewan and Canada, we continued advancing the Roughrider project, one of the highest grade undeveloped uranium projects in the world. More than 80% of the planned 35,000 meter drilling program has now been completed in support of the upcoming prefeasibility study. Turning to UR&C. In addition to the progress we have made on Siding, we continue to accelerate engineering work led by Fluor and have advanced into a new phase with a significant expansion of engineering and technical resources supporting facility design, siding, licensing and development. Through this process, we have been engaging with the U.S. Department of Energy to align with key national priorities regarding restoring nuclear fuel cycle sovereignty. As a result, additional candidate locations were added to ensure coordination and alignment with such priorities. Last but not least, Ulta Parana, our project in Paraguay. As mentioned, a recently completed independent report concluded that the project represents a globally significant critical minerals platform with the potential to materially contribute to the security and diversification of U.S. supply chains for titanium and vanadium. The project's unique strategic fit includes being located in a U.S. aligned partner country is access to clean, low-cost power and its ability to integrate into U.S. and allied downstream processing supply chains. We view the project as notable because it addresses structural vulnerabilities in U.S. critical minerals policy. It demonstrates our long-standing approach to identifying, acquiring and developing assets that align with U.S. national security advanced manufacturing and resilient critical mineral supply chains. Finally, the broader policy backdrop remains robust. On April 23, 2026, the U.S. Department of Energy through his Office of Nuclear Energy and the Defense Production Act nuclear fuel cycle consortium. Launched the nuclear dominance, 333 campaign to secure the United States' nuclear fuel supply chain and support future reactor deployment. The campaign is structured around 3 core objectives to be achieved by 2033, including catalyzing a secure and cost competitive domestic nuclear fuel supply chain, accelerating advanced reactor deployment and finally, leveraging the DPA framework to align workforce development, financing innovation and industry collaboration in support of the nuclear build-out. Against that backdrop, let me briefly summarize the progress we made during the quarter. First, we successfully brought online the largest greenfield ISR project in the U.S. in over a decade. Burke Hollow's progression from discovery in 2012 to production in 2026, serves as a reminder that uranium production capacity cannot simply be created overnight, reinforcing the important strategic value of UEC's operating assets and portfolio of permitted uranium projects. Second, we have expanded capacity, enabling increased production rates as we move towards the end of the fiscal year. Lastly, we have advanced UR&C to a final shortlist of candidate locations and are moving towards the next phase of engineering, siding and licensing activities. All of this was accomplished while maintaining 1 of the strongest balance sheets in the sector with significant liquidity and no debt. With the largest uranium resource base in the United States, growing production infrastructure and a clear pathway towards expanding our role across the nuclear fuel cycle, we believe is well positioned for the next phase of growth in the uranium market. Our strategic critical mineral portfolio provides for adjacent opportunities supported by similar policy priorities. Before we open the line for questions, I'd like to note that I'm joined today by Josephine Man, our Chief Financial Officer; Scott Melbye, our Executive Vice President; and Brent Berg, our Senior Vice President of U.S. Operations. With that, operator, please open the line for questions.

[Operator Instructions] Our first question comes from Brian Lee with Goldman Sachs.

I guess I had a couple here. First on the cost side. I mean I'd be curious, I know you said it's going to normalize a bit here into fiscal Q4 and beyond and the lower volumes in fiscal Q3 and the tax has obviously pushed costs up in the quarter. Can you maybe quantify a little bit sort of what that normalization is going to look like over the next quarter or 2, are you back into the 30s as quickly as fiscal Q4? Is that going to take a couple of quarters? And then maybe give us some of the moving pieces beyond volume? Are there other cost drivers beyond just higher production volumes.

Brian, thank you for the question. And as you've seen in the press release in the remarks earlier that I made, we did highlight sort of the key drivers here and really to expand on it on your question. As you know, a large portion of our operating costs are fixed. So again, when production volumes are temporarily lower due to the timing of these well field approvals, unit costs are impacted. We would definitely sort of draw attention to the total cost per pound over the course of the 276,000 pounds produced, which comes in, as you know, within a cash cost per pound of roughly $32.40. This remains industry competitive and a leading number in the domestic industry in the U.S. As we mentioned in the press release and the material, Brian, we do expect that the trend on production going into fiscal Q4 and beyond is higher. So again, in an environment where this is the biggest sensitivity for us and the economies of scale do matter. I definitely think that we should be improving on the numbers that you saw in this quarter. Let me just pause and hand it over to our CFO, Josephine Man, for just any additional color or commentary on that.

Thanks, Amir. This is Josephine. Yes, I think Amir is correct. As we are expecting to increase our production in the coming quarters, definitely, we will see the total cost of pound and cash cost per pound to be comparatively lower than this quarter. As [indiscernible] mentioned that a big portion of our operating costs are fixed. So when the production volumes are temporarily low during this quarter, it definitely drives the total cost per pack increase as compared to Q2. But with the new wellfields in Christensen Ranch and Burke Hollow coming to production in fourth quarter this fiscal year, we are expecting to have a lower cost per pound in the coming quarters. Back to Amir.

Thank you, Josephine. Brian, did you have a follow-up on that?

Yes. No, that's helpful. Maybe just as we think about those production volumes with the 3 header houses on in Christianson Ranch and Burke Hollow, producing in Q4, sort of what's the step function? It seems like there should be a step function increase in volumes. Is it pretty linear where we can kind of take the header houses in Christensen Ranch and look at the volume from Q3? And sort of triple that? Or what's sort of the ramp-up cadence, if you will, at least in the near term? And then maybe last question, if I could squeeze it in. Just thoughts around URC and the timing of key milestones as we think about the second half of the calendar year here?

Thank you, Brian, and you certainly squeezed the lot in there, but okay, we'll unpack all of that. We've been really ramping up when it comes to our construction capability and campaigns to build additional header houses, which is basically production capacity. And yes, there is a linear relationship there. And again, for context, if we step back, this is after our industry really collectively was dormant for about 15 years. And the last couple of years, we're coming back into this area and this time of incredible progress and activity. I'm going to hand it to Brent Berg to speak a bit about the growth we've had year-over-year in terms of our personnel workforce capacity and the ability to keep expanding and constructing this production capability. Brent, over to you. Go ahead. You were muted, Brent, but just start from starting then.

Okay. Very good. Brian, I was just saying that a year ago, we had 103 employees in Wyoming and Texas. Today, we've grown our operations team to 185 personnel so in 2025, the UEC team was heavily dependent on external contractors or construction and continued mine development. Today, much of that work is being done in-house by our own team, and we continue to build the team that can rapidly deploy other projects in UEC's portfolio. And maybe just 1 other note with respect to production and normalizing. So during the quarter, the bulk of that production came from wellfield 8 and 10 with 8 active header houses and production predominantly came from new wells that were installed in 2025 with header houses 10, 7 and 10, 8 accounting for the bulk of the production during the fiscal quarter. Of course, we started up well field 11, 3 new header houses at the end of the quarter, and it's -- we really won't see that production until this fourth quarter, but anticipate that to move up substantially. Thank you. Back to you, Amir.

Okay. And Brian, I think you were asking about UR&C. And specifically, as we mentioned in the release, we're really ramping up into the next phase here of engineering work siding, permitting with an expansion of the engineering team and the work that's being provided by Fluor as well. Our own team increased in size and scope over this period. The siding work has been coordinated as we mentioned in the press release with some of the initiatives that are taking place at the Department of Energy, making sure we have maximum alignment there. We've always believed that the project and really the need to build a new conversion facility was and has maximum alignment with priorities in the U.S. right now around creating a more resilient nuclear fuel cycle and to really repatriate the nuclear fuel cycle with the Russian ban kicking in by end of 2027, really that's around the corner. The current key bottleneck in our mind and in the market really remains a shortage of sufficient domestic conversion. So that work is advancing and really has kicked into next year from a standpoint of the engineering siting and licensing, as we mentioned.

And the next question comes from Heiko Ihle with H.C. Wainright.

I just want to point out, the stock is still up 68% year-over-year. So some thing's gone, right? That said, how much in this quarter, would you say was a continuation of regulatory delays that we've seen in the last quarter? I mean it looks like you're working past all of that. But maybe just give a bit of color. I mean, it's now almost mid-June, some color on the current quarter and maybe even the remainder of calendar 2026.

Thank you, Heiko, and I appreciate the context that your question provides. And if we step back and if you've been following the company, you know that we talked about these regulatory delays extensively in our last quarter. And so really, this is a continuation of that and it's a continuation of a broader theme of industry growing pains that we're experiencing just as the industry and ourselves are ramping up. Brent spoke about the fact that the sheer size of our workforce has gone from just over 100 people to almost 200 people year-over-year, imagine that kind of growth, well, the regulators are going through similar type of staffing and other bandwidth capacity that they need to have. And so these regulatory delays that we experience, which impacted lower production in this quarter were discussed and really described in the last quarter, and we're making good progress. Those approvals did come in, except that they came in near the end of this quarter. And so hence, it was a delay, but these are delays that have been resolved. And so that's important to highlight as well. So things are progressing, and that's why it gives us the confidence as well to be able to speak to a better outlook and improved numbers going into the fourth fiscal year of the -- for the company and beyond that. So for sure, I think to your point, if we step back, there should be no surprises here. But at the same time, when you look at even the numbers for this quarter from a production cost point of view, you zoom out and look at it over to 276,000 pounds produced, the company is still delivering on the lowest cost production in the United States and in the domestic industry. So we've got a lot of capacity in front of us coming online, the additional header houses at Christensen Ranch, the construction that's going to be taking place at Ludeman, that will be our third ISR operation in Wyoming and not to mention Burke Hollow that did start operations this quarter and will be contributing to production moving forward. We're very proud of the work at Burke Hollow. As you know, that's a project that's 14 years in the making. I talked about it earlier in my remarks. And so can't lose sight of all the construction development and deliverables that we have here as well.

Fair enough. Completely different things. Let's talk about your equity book a little bit. I mean, it's obviously has been creating a decent amount of volatility over the past few quarters. Is there a way to more normalize this going forward, just for stability and more predictability for the analyst community?

Yes, that's a fair question, Heiko. And as you know, our equity book is strategically positioned in some names that we have exposure to in the sector. It does cause this quarterly mark-to-market volatility. This quarter, as you also know, given some weakness and kind of flat movement we saw in the uranium prices we selected to continue to maintain our inventory position. So there were no sales this quarter. And again, that was intentional, and that's a function of our unhedged strategy. But moving forward, as we achieve more of a regular quarterly cadence of sales and reporting around that equity book, I think, can probably move towards more of a -- on an adjusted basis where we can maybe pulled that out and not have it impact the reported numbers. And Josephine, if you want to comment on that as well. But I think that's part of the progression of we're hopefully heading. Josephine, if you want to add to that?

Yes. Thanks, Amir. I think that's right. The volatility in the market creates a little bit of unknown to the income statement, as you can see in our quarterly results about $19 million was attributed to that change in fanmarket, value of our equity securities. So moving forward, the reconciliation of disclose of adjusted EBITDA, I think would help the community and stakeholders to understand our result of operations better. Back to you, Amir.

All right. Thank you. Thank you, Heiko.

The next question comes from Alexander Pearce with BMO.

Great. So I mean, Amir, well, this may be a question for Brent. Just building on the question you had before about production in the quarter. If we took the delayed new head of houses aside from it, production was down quarter-on-quarter. So maybe you can just talk about what you're seeing in the older head of houses. And what was the sort of function of tie-ins or flow rates or what -- that's the first part of the question.

Thank you for that good to have you on the call. Yes, I'll hand it over to Brent here shortly, but definitely, I would say, again, most of what you would normally see Alex in terms of how an operation like this would really multiple header houses would be able to manage some of the near-term natural decline curves that are going to be inevitable in some of the producing wellfields with much fewer numbers online right now, there's bound to be some greater volatility in kind of the quarter-over-quarter numbers. But certainly, as that bandwidth increases in terms of number of wells well fields and header houses, we should be able to smooth the numbers out and better manage that natural decline curve that exists and institute recovery and hand it over to Brent now. Go ahead, Brent.

Yes. Thanks, Amir. Alex, maybe just a little color on that. So the production at Christensen Ranch came predominantly from wellfields 8 and 10 with 8 active header houses operating and that production came predominantly from new wells that were installed in 2025. So Header House is 10,7 and 10,8 accounted for over 50% of that production in the fiscal Q3. and 87% of overall production came from new wellfield patterns that we installed in the same year. So with that, we've really focused our production ramp-up with ongoing mine development, and that development continued in both wellfield 12 and 10 extension, where we have 5 header houses under construction, 2 of those in wellfield 10 are nearing completion with another 2 under construction and 1 header house in wellfield 12 is nearing completion of construction. So in total, 4 header houses are planned in wellfield 12 for future production. We -- the monitor wells have been completed, the pump test is planned with respect to well installation, all drilling is completed for Header House 12,1. And in that wellfield 10 extension drilling at Headerhousens 10, 9, 10, 10 and 10,11 is complete. -- and drilling started for header house 10, 12. So we've been really focused on development. And of course, collaboration with our regulators is important. But really, I think the best way we can ensure that new production comes online quickly is by steadily advancing new infrastructure on the ground. Amir back to you.

All right. Thank you, Brent. Alex, back to you.

Okay. Maybe the second part of the question then, obviously, you've mentioned the new wellfields coming on with the new regulatory approvals. But have you seen any streamlining of the process for getting the regulatory approval so that going forward, maybe you can manage better and avoid some of the delays that you saw for this round?

Go ahead, Brent.

Yes. I would say the state regulatory agencies have demonstrated a very high level of collaboration and are -- they're actively working to address some of those longer lead time challenges that naturally arise during periods of increased industry activity. I would -- UEC, of course, has remained active and has an ongoing dialogue with the agencies continuing to advance well field development in parallel. And I'd say this coordinated approach allows us to progress and maintain both regulatory and operational fronts. The timing for the review ultimately rests with the agencies themselves. However, I can confirm that the infrastructure development and related activities continue to move forward. And we'll certainly provide more updates to key operational milestones are achieved. I would say the regulator much, much like us when we restarted operations is, of course, growing and responding to increased regulatory submissions that come across their desks, and we are seeing some progress and some improvement. Back to you, Amir.

All right. Thank you. Thank you, Alex.

The next question comes from Justin Chan with CPR Financial.

It's SCP, but I'll figure them that. I was probably bumbled there. and Brent, maybe just a follow-up on Alex's question on -- maybe first to clarify, I guess you would have 5 header houses now producing at Christiansen Ranch, like 5 plus or 2 plus 3. And then maybe just as a bigger kind of my main question on this direction is what level of header houses and maybe rollouts per month do you think you would need to get to that 1 million or 2 million pounds a year level given some of the wells will be declining, you'll need new ones to come on. I guess what do you see as a steady state in that regard?

Justin, thanks for the question. And there's no doubt, and this is what you're building on that there is a linear relationship between this construction activity, building new header houses and well fields and the increase in production that we're expecting and building out -- we're right now, as you know, reporting and kind of providing updates on this activity in our quarterly reports. And by the time I think you see us report to fiscal year-end, where we've had a chance to bring several more of the header houses online and some actually in operation. There will be a better ability to kind of forecast and see the contribution from each header house towards a segment of production. Bottom line is that not every header house is the same size or created equal. So while there is a linear relationship, I think some of that ability to kind of just extrapolate that forward may not be as simple as kind of this many header houses to get to that end result. And as you know, we're really looking to get to those higher production output. We have the largest resource base in the U.S. We've got 12 million pounds of combined license capacity. But to really increase production, we need to be able to continue to deliver on some new projects and new header houses, all of which is moving forward and advancing Burke Hollow being a notable one. And so we'll have more information on all of that. But Brent, if you want to just comment on that too, additionally for Justin's question.

Yes, absolutely, Justin. As you noted, we had 2 header houses constructed and installed in 2025. Those are header houses in wellfield 10 expansion, 10,7 and 10,8. Of course, we recently added 3 into production in wellfield 11. So that's 11, 1, 3 and 4. And we've got 5 under construction now. The other thing I would note, Justin, is we've significantly increased our drilling capacity to install wells that, of course, drug drive production as well, and we've got a threefold increase from when we started the operation at Christensen Ranch today. So we're really ramping up our construction capacity and zeroing in on increasing our production profile as we move forward. And Amir, back to you.

All right. Thank you for that. Thank you, Justin.

And the next question comes from Joseph Reagor with ROTH Capital Partners.

A lot of what I wanted to ask was already touched on, but just kind of a few things that I guess, you guys are good at Jobo explaining why production declines over time. But as you look back at Christensen Ranch's performance to date compared to what was, let's say, the model ahead of time. Has it performed in line with expectations, slightly better, slightly worse, obviously, the regulatory stuff out of your control. But how is the mine performing compared to the model?

Joe, I mean, thank you for that. And we couldn't be any more clear about the performance. I mean the ultimate performance of any mine is the cost and the output and the efficiencies there. And for a project that on this call, in particular, we've spent a lot of airtime given to regulatory delays that are outside of our control. We can lose sight of the fact that we're 277,000 pounds in across really a modest number of header houses, and we have industry-leading production cost. That's really a testament to the efficiency of the operation, the quality of our team and the work that's being done to really deliver these industry-leading numbers. So I would argue, and I think you would -- you and I have talked about this, that the cost numbers out of Christianson Ranch, in fact, have come in better than expected and better than expectations that folks said in terms of how the project can do. So there's no doubt that as we continue to expand the project, our confidence is built on the foundation that this could be a very efficient low-cost operation and it really is about making sure we can install and construct and build that additional output and capacity which header houses afford and provide. So certainly something that we're very pleased about. This is a project that is a brownfield and historically has prior to our restart had 6, 7 years of prior operating history as well. So it's certainly a notable project. Along the way, as you know, we've had not just refurbishments, but upgrades and all types of work done that we've reported in prior quarters. So we've come a long way in a very short period of time. And it's really only been about 15, 16 months since production started. And as I mentioned in the last quarter, most of this low-cost production so far has been carried at say, 6 -- almost 70% of the load has been carried by 2 header houses. That's quite remarkable. So certainly, it gives us the confidence to continue to invest and you've seen that in our numbers that we had increased investment in Christensen Ranch this past quarter, which was really driven by the additional construction work that we're doing and are completing and have underway.

Yes. Just good to have you say it, that is the sense I got. And then the other item, as mentioned in the release that you're working on the PFS for Rogier. What's the timing goal for you guys to have that PFS like have the summer at least?

Joe, that's a great question. And we're -- as you noticed in the release, didn't list and time on that, and that's mainly because we're almost done with the conversion drilling. We're 80% done. We need that work to be completed. We need to make sure that all the steps with respect to getting our chemical assay results back on that drilling is in hand, and so the work can be completed with the third-party technical and engineering firms that are on board and available. If I had to sort of estimate at this point what we're looking at, Joe, I would say we're estimating towards the end of the calendar year to have that PFS ready but that's an estimate at this point and -- but something that we're definitely working towards and hopefully, we'll have it by that.

And the next question comes from Kristian Koschany of National Bank Capital Markets.

Kristian Koschany on behalf of Mohamed. Just going back to the URC timing that we were talking about earlier. I just wanted to confirm that the conversion study should now be expected in 2027.

Yes, Kristian, thanks for that question. I it should be a 2027 event. Between now and then, we will have further updates along the way as we're progressing on the work, including, again, whether it's on siding, whether it's any of our discussions with strategic partners and/or the U.S. government and/or even potential utility offtake discussions that we're having. So there will be updates along the way. But with respect to the work that will culminate and supporting what would ultimately be a Class IV cost study, which is what the next phase of study on this will be a first half of calendar 2027 event.

Great. And then I was wondering if you folks could provide us with some more color on the change in ad valorem taxes and/or production-based royalties in Wyoming for modeling this is?

Yes, I'm going to hand it over to our CFO, Josephine Man, to provide some color on that. Go ahead, Josephine.

Yes. Thanks, Amir. Thanks for the question. Yes. So this is normal and routine process with the Wyoming Department of revenue. So they have been very fair to the uranium industry during the previous ups and downs in the commodity cycle. So we see that the state of Wyoming Tax, let these 2 separate tax on the mineral production in the state. So it's a service pack and the volume tax. The service tax is imposed on at the state level, ,while there volume taxes imposed on the country level. So right now, we see that there is an increase in the industry factors that the department of revenue used to capture the value of the uranium production to calculate both taxes. So we see -- so in this quarter, we saw there's an increase that in this industry factors -- and the increase was for a 4-year cycle. So new industry practice is applied prospectively to -- from 2026 to 2029. So we'll see steady industry factor that will be applied to our uranium production in the next couple of years. Back to you, Amir.

Okay. Thank you, Josephine, and thank you, Kristian.

I would like to turn the conference back over to Amir and Nanny for any closing remarks.

Yes, thank you, and thank you all for joining the call today, and we look forward to any follow-on communications that we might have with you in the coming days, and look forward to the quarter ahead. Thank you all, and have a good rest of your day.

The conference has now concluded. Thank you for attending today's presentation. You may now disconnect.