All right, so good morning everyone and welcome to Silex Systems Limited 2024 Annual General Meeting. I'm Julie Ducie, Chief Financial Officer and Company Secretary and I'm pleased to advise that we have a quorum present here at Dentons in Sydney. I now declare that our 2024 Annual General Meeting is now open. We also welcome those shareholders who are joining us virtually today and encourage you to participate in the meeting from wherever you are located. The online platform that we are using today allows shareholders, proxies and guests to watch the live webcast and eligible attendees can ask questions and vote in real time. The minutes of last year's Annual General Meeting held at PwC on 13th October last year are also tabled and are available for inspection by shareholders via email. At the conclusion of the meeting we will take those minutes as read.
A notice of meeting has also been distributed and we will also take it as having been read. Let me introduce your board to you. We are joined today by our Chair, Mr. Craig Roy, our founder, CEO and Managing Director, Dr. Michael Goldsworthy and our non-executive Directors, Chris Wilks, Helen Cook who's joining us on the screen today, and Susie Corlett who is standing for election to join the board today. Also joining us today from PwC is Aish Chandran, our audit partner. Craig will shortly provide his opening address and following that Michael will provide a presentation reviewing our highlights for the year along with a business update. Shareholders joining virtually have been provided with instructions on how to participate and vote in today's AGM with details available in the Notice of Meeting.
Michael's presentation, Craig's address and the Notice of Meeting can also be found on our website. So with regard to questions, we have received a number of questions in advance of today's meeting and Craig and Michael have attempted to address these in their respective remarks and presentation. But questions can now be submitted on the online platform at any time as well. To submit a written question, select the Q and A icon and select the topic to which your question relates from the drop down list. Type in your question in the text box and press the send button, subject to the time available. Questions that we receive will be addressed later in the meeting and will be moderated as necessary to avoid repetition or in the interest of time. Should you wish to ask a verbal question, please follow the instructions below the broadcast window.
Shareholders, proxy holders or corporate representatives attending in person will also have the opportunity to ask questions following Michael's presentation. So with regard to voting, all items of business today will be decided via a poll for online attendees. If you have correctly registered for the meeting and are eligible to vote, the vote icon will appear on your screen. Selecting this icon will bring up the list of resolutions and present you with voting options. To cast your vote, simply select one of the options. There's no need to submit or enter, no need to hit a submit or enter button as your vote is automatically recorded and you can change your vote at any time up until when Craig declares voting closed.
Shareholder, proxy holder or corporate representatives attending in person and who are eligible to vote have received a blue voting card on entry to cast your votes. We now declare voting open on all items of business and for those shareholders attending virtually, the poll icon will soon appear on your screen. Please submit your votes at any time. Craig will give you all a warning before moving to close voting. So with that I am now very pleased to welcome your chairman, Mr. Craig Roy to provide his opening remarks.
Thanks, Julie, and thanks for everyone coming. It's great to see so many familiar faces and a few new faces in the room, so thank you for that, Julie, as well. Welcome to those online as well. Julie's already opened the AGM, which is terrific, but I think it's fair to say, as with every year, it's been another big year for Silex. My presentation today was put up and loaded up on the ASX this morning, and I need to stick pretty much close to that, but we'll just see how we go in the Q and A section. I'd like to just highlight through this presentation what we've achieved over the last few years. This isn't a fly-by-night company. This is in for the long haul, and more recently to execute our plans over the last 12 months as well.
All of our efforts are in partnership with Global Laser Enrichment, our partners GLE and obviously our joint venture partner Cameco Corporation. And we also see then the positive outlook for the uranium sector that really underpinning what we're doing in Silex and creating a very positive picture. It's hard to believe it's been less than four years since we relicensed the exclusive license and U.S.-based commercialization joint venture GLE. In that time you will all know the global nuclear industry has undergone fundamental change. Demand is significantly increased in the face of climate change and energy security imperatives. Power requirements of AI. You'll read that in the newspapers every second day around the great driver of AI for nuclear energy data centers, electric vehicles and other industrial uses of electricity. On top of that potential supply disruptions driven by geopolitical events have emerged.
Michael will say a little bit more about that later on, and as a consequence GLE and therefore Silex continues to execute its commercialization plans in order to position ourselves to address the triple opportunity. We've been talking about the triple opportunity for some time in our announcements. The triple opportunity that's materializing in the global nuclear fuel supply chain, so that opportunity or those opportunities could involve production at three different grades of nuclear fuel. As many of you would know, the planned Paducah Laser Enrichment Facility that we call the PLEF in Kentucky in the U.S. is underpinned by a really important agreement between us and the Department of Energy in the U.S. The agreement to access the acquisition of legacy depleted tails inventories. The PLEF has the potential to equate to a Tier one uranium mine.
It's already out of the ground though producing up to 5 million pounds of U3O8 equivalent per year for up to 30 years, ranking the top 10 of today's uranium mines. Importantly, GLE's depleted uranium feed and natural grade uranium output from the plant is in the form of UF6 uranium hexafluoride and therefore includes the value of conversion in that process. People pay for that. So this is a real value to GLE, Silex and Cameco. So it's a critical component of the nuclear fuel supply chain and one that's also facing significant constraints. And then there is the enrichment and the potential for GLE to further enrich UF6 to produce LEU, LEU plus as well as HALEU in the future. So just a little bit of a summary. What have we achieved over those four years together with GLE and Cameco?
So I already mentioned up front we successfully restructured GLE under Silex Cameco ownership and appointed a highly credible and experienced leadership team at GLE. I just do want to underpin and this wasn't in my uploaded from what was on the ASX but Steve Long and James Dobchuk, the CEO and the CCO are both doing an outstanding job and I think they're excellent representatives of GLE and doing a great job in the U.S. leading our role over there. We've assembled highly skilled and dedicated GLE and Silex technology teams leveraging off deep capabilities in our long serving experts. And I think for those board members who've been around for a little while, including Helen on the screen, just you get blown away by the capability when you either go to Paducah and meet the staff there or the staff at Lucas Heights as well too.
There's not a problem we found that they can't solve. So it's all underpinned by the excellent staff at both of those sites. We've advanced the technology maturation. We're currently undertaking the pivotal TRL6 demonstration of the Silex uranium enrichment technology. But more importantly, or as importantly, we've commenced preliminary activities for plant scale technology maturation in TRL7 and manufacturing readiness preparations activities in parallel. So we're not just focused on one target, we're focused on the longer term future as well. Completed GLE's new facilities in Wilmington earlier this year providing 70,000 sq ft for continued growth of GLE team commercial activities in house classified manufacturing capabilities as well. So that was an important step change for us. We progressed the acquisition. You will have seen some of our announcements around the option that we have over some land. 665 acres at Paducah, Kentucky site for the planned plant.
Strategically situated adjacent to DOE's former first generation Paducah Gaseous Diffusion Plant at which the legacy depleted uranium inventories, that's the feedstock, are located, and we've already done some substantial site characterization work recently is commenced on site. So that's a really important strategic piece of land that we have an option over as we speak. Today we've started preparations for the NRC, Nuclear Regulatory Commission, commenced for plant license for the PLEF, including the deployment of a highly experienced regulatory team to support the required safety and environmental assessments and license application documentation. Again, I'm trying to paint this picture. We're not just doing one thing. The whole focus is in TRL 6. We're focused on the long game as well too. Last but not least, solidified key relationships in the U.S. government and industry to support GLE's path to market.
Notably, you would have read this online as well too. The GLE team also submitted a bid to the U.S. Department of Energy's LEU Enrichment Acquisition Request for Proposal in September 2024. So that's under consideration at the moment by the government. While it's been a multi-year run-up to get us to where we are today, I think it's fair to say substantial momentum has been further built in 2024. The U.S. is the world's largest producer of nuclear power and is expected to remain the largest nuclear power generator for years to come. With the triple opportunity in view, GLE has positioned itself as a key U.S. domestic enrichment company with a unique single-site production offering of natural-grade conversion capability, capacity. Sorry, and LEU-plus and HALEU, all of which could be potentially produced at the plant with our own technology.
Our Australian technology deployed to the U.S. Our primary short-term focus is on completion of the full-scale pilot demonstration project for our technology enrichment technology, so known as TRL6. Success in this project would largely de-risk the technology that will enable us to focus on taking the technology to market in the most effective way possible, and this is our priority. We intend for GLE to provide next-generation solutions and become a reliable, sustainable supplier of nuclear fuel for the global nuclear power industry. This will help support Western energy security, obviously. Very important, the provision of reliable, safe and clean electricity contributing to global decarbonization efforts. As you're aware, our laser enrichment technology is applications across multiple global markets including quantum silicon, and you will have read that in our announcements, the stuff we're doing with SQC and for the potential production of medical isotopes.
Our quantum silicon production project aims to commercially deploy the silicon Silex technology for the manufacture of ultra-pure enriched materials for next-generation quantum computing. That's why we've partnered with SQC. We've achieved numerous milestones across our projects this year, achieving technology de-risking and commercial deployment plans for the Silex technology in all three fields, including strong engagement with our various commercialization partners and potential customers. So I think bottom line is that we won't go into a technology try and develop a technology unless we see a market. So we want to have that unique capability around both the technology and we want to be able to see a market there, whether it's medical isotopes, uranium, silicon or anything else we may wish to explore into the future.
Looking forward, our growth and opportunities are made possible by the utility of the Silex technology and the exceptionally talented teams at Silex and GLE. And I've already sort of like passed my strong, strong commendation onto both of those teams who are at the core of our activities and achievements. As we continue to scale, we'll recruit more talented people with the right skills and expertise to put us in that position to deliver on our priorities and ultimately to create long term value for shareholders. We also continue to invest for success. That's our posture. We see this as an amazing technology and we're investing for success as evidenced by our achievements and expansion at GLE this year, we're preparing for that success in conducting our business.
We're wholeheartedly committed to our core values and no more so than the highest prioritization of health and safety of our people. Again, whether it's here or in the U.S. we place a premium on environmental sustainability reinforced by the exposure we provide to clean energy generation, the planned reuse and cleanup of legacy depleted uranium, and undivided attention to the risk management and prudent governance. So that brings me to the board. You've got the board to my right and Helen up the top of the screen there as well too. I'm delighted to lead a very committed and focused board which aids the navigation of our company's commercialization strategy and operations. It is a complex environment, cross border, highly regulated environments, all with classified technology. This isn't straightforward, but I'm very comfortable that the board pays attention to the important issues that they need to.
We maintain an active program and board and director assessment to ensure we continually improve our governance and have the right breadth of competencies across our board. You were introduced to Susie before. I'm genuinely very, very pleased to welcome Susie to the board. She's standing for election today. As you will have seen in the papers that accompanied this meeting, we did a pretty extensive search, we used a search firm and Susie bubbled to the top pretty quickly, pretty readily. You know, some of her experience is just so aligned with what we're trying to achieve for Silex. I look forward to your contributions, Susie, as we continue to seek to commercialize and grow Silex as well too. You will have noted in the pack she has expertise in global mining finance, project management, operations, governance and risk management.
As I said, she'll be a valuable addition to our board. These things, sometimes an upside comes with a bit of a sad note as well too. Helen Cook retires from the board today. Helen has been an outstanding member of our board over the course of her tenure here. I think it's fair to say that Helen's personal business has just blossomed and blossomed to the point where she spends a fair bit of time, I'm sure you wouldn't mind me saying this, Helen, fair bit of time overseas dealing with her clients. You will have picked up with her on Sky News, being a real advocate for nuclear power as well too. It's with some sadness that we say that Helen's stepping off the board from today.
But thank you Helen, for your contributions, the networks and doors you've opened, and the insights you've provided over your tenure on the board. Before handing over to Michael again, I'd like to thank the directors who are absolutely committed to the company. I'd like to thank Michael. You don't see what he does behind the scenes to make this company successful. I think it's Michael, when we go to the U.S. next week, it's your sixth or seventh trip to the U.S. this year. He loves planes, let me tell you. He loves sitting in the back of planes, making his way across to Wilmington and doing the work over there. But his dedication is just amazing. This is a lifelong ambition to Michael and he does a great job and we're lucky to have him as CEO. Julie is equally committed to this company.
She is an outstanding talent as well too and really sets us up for success. So Geordie, who couldn't be here today, our Chief Commercial Officer. He's unfortunately not available. He's leading a lot of our strategy, our commercial part of the business, and he does an excellent job as well. And we've got two of my colleagues over here as well too, who support Julie in such a wonderful way as well. So thank you guys. Also, Michael, I think that means it's over to you. Just take this off here.
Thank you, Julie. Good morning everyone. Welcome again to the 2024 Silex AGM. Great to see some reliable people turning up. Some of you have been coming to these meetings for a fair while now. This is only my 26th, so it's great to stand up here again and give you the update and what we've done over the last year. Also got some HotCopper advocates here. How was the dinner last night? All right, or is that tonight? Anyway, great to have you all here. I'm going to talk about principally uranium, but we also have, as you know, a silicon project and a medical isotope project, all to leverage our Silex laser enrichment technology. So these are our three focus areas for now and all traveling along quite nicely.
Background to Enrichment. Uranium enrichment for the last 60-70 years has been on a commercial basis for the civilian nuclear power industry around the world, principally in the US, Europe, and parts of Asia. At one point, all the fuel was enriched using gas diffusion technology. Very primitive, high energy consumption, very high capital costs. That's all obsolete now, but that was born in the Cold War era. Second-generation centrifuge technology has much better efficiency and lower costs, and that is what powers up all our nuclear reactors today. 100% of enrichment is through the centrifuge machine of one form or another. Third-generation technology. Our Silex laser technology will hopefully be the first to the mark with the third-generation technology. It's quite high efficiency using lasers, and the specific throughput through our equipment is way, way higher than what centrifuge has.
So this all adds up to lower costs, hopefully. And we believe this is the future for uranium enrichment. Just some highlights over the year that Craig has already touched on. As you know, we've been accelerating the project with GLE with the support of Cameco and that is to accelerate our full scale pilot demonstration project which was originally scheduled to be finished at the end of next year. But we are not far off at the moment. As Craig mentioned, GLE opened a new headquarters in June and that is a very impressive building site that will house the corporate and commercial teams and also provide a huge area for classified manufacturing. And I think we've got some slides coming up on that. Some legislative activities through the year from the U.S. Government.
In May, Congress passed the Prohibiting Russian Uranium Imports Act, and that came into law in August. And that will see the banning of Russian imported fuel from 2028 onwards. There's some waivers between now and then for making sure utilities don't run out of fuel. And then on the 15th of November, just last week, Russia announced temporary restrictions on exporting enriched uranium to the U.S. So it was a bit of a tit for tat. We're not sure where that's going to go, but there are supposedly exemptions available to the U.S. utilities on that front as well. The Prohibition Act also triggered $2.7 billion U.S. funding for new nuclear fuel production capacity in the U.S., and as Craig mentioned, the DOE released the low enriched uranium enrichment acquisition Request for Proposal in July, and GLE submitted its bid for that funding in September. And that is under assessment.
We understand that there is a desire to have that, that funding awarded before the end of the year, but we'll have to see how that plays out, and then GLE, of course, has made significant progress with the Paducah Laser Enrichment Facility site in Paducah, Kentucky. The quantum silicon project is pushing along quite nicely here in Sydney. At Lucas Heights, just south of here, the quantum silicon production plant. Construction continues. That's a $16 million project with $5 million support from the federal government and nearly four and a half from our offtake partner, Silicon Quantum Computing. I'll come to that shortly. Medical isotopes continues at Lucas Heights, and for that we're aiming to develop a process to enrich ytterbium-176, which is used to breed another isotope, an active isotope called lutetium-177.
That is being used already today in several parts of the world to treat advanced prostate cancer. Turning back to uranium, we're in the midst of a global nuclear fuel industry undergoing quite disruptive bifurcation and that is intensifying the nuclear renaissance in the Western world which was underway before Russia invaded Ukraine. GLE and Silex commercializing the Silex technology. In my memory this is the most positive we've seen the nuclear fuel markets ever. We couldn't have more favorable conditions, albeit with the backdrop of the tragic situation in Ukraine. There are opportunities that have resulted and the Western world is moving away from reliance on Russia for so much of its energy resources and we want to be part of that. I've mentioned the new facility and the key Technology Demonstration TRL6.
We have the facility operational and preliminary testing underway as we speak. There's a parallel focus with GLE's commercialization activities, including the RFP, the PLEF Site acquisition. That's the land that Craig mentioned that we have an option over. GLE has an option over, and there's a big effort on the NRC license for that first plant that's going quite well, so GLE's path to market is focused on its unique ability to address what we call the triple opportunity. The first opportunity hasn't been in place since, well, 2013 actually. There was a three year period to put our bid together for the Department of Energy's reallocation of resources at Paducah, Kentucky, and that resulted in an agreement between the DOE and GLE back in 2016.
That revolves around processing huge inventories of depleted uranium hexafluoride that are stored at the DOE's first-generation gas diffusion plant and which sits adjacent to the land that GLE has an option to acquire, so that's the first opportunity that has been in place since 2016. Then, since the Russian invasion of Ukraine and the moves for the Western nuclear fuel supply chain to rid itself of reliance on Russian imported fuel, the LEU production opportunity has strengthened dramatically as the Russian bans have come, the Russian import bans have come into play. There is now an urgent need in the Western world to build more enrichment capacity to produce low-enriched uranium, LEU. HALEU, of course, is the high assay LEU fuel required for next-generation reactors, including what we call small modular reactors, so three opportunities there, a bit about the nuclear industry.
As I mentioned, conditions couldn't be more favorable. Some of the merits of nuclear power are not fully valued yet, especially in this country. But of course we have the largest source of clean energy in America and several other countries. Carbon-free and a huge contributor towards net zero 2050 ambitions, advanced reactors coming down the pipeline. This is not just SMR, small modular reactors, but there's some large-scale nuclear power plants, Gen-4 nuclear power plants that have inherent safety systems and better economics. And they are also coming down the pipeline. One of the lowest costs of energy available, the International Energy Agency estimates the levelized cost of electricity from nuclear at $70 per megawatt hour.
So we need to look at the experts when we talk about the cost of nuclear and we see the costs are at least very competitive on a national and global basis. One of the problems with nuclear has been the fact that after Fukushima, many countries backed off and so the construction programs dwindled and ended up that we only had one or two reactors being built in various parts of the world for quite a few years. If you make one or two of something, it's always going to be expensive. But if you start making dozens of the same thing, or even hundreds, then of course the costs go down dramatically. And then we have SMRs that also promise some cost reductions in nuclear power. But even today, $70 per megawatt hour is a pretty low cost of electricity.
The other thing is nuclear power plants can run for 80 years. There's some already being licensed for 80 years operation, and some of those will probably get licensed for 100 years of operation. So these are intergenerational power sources. Electricity generators. Renewables are great, but they'll never do what nuclear can do. I call renewables a bit of a 20-year band aid. The 20 years of operation, you're going to have to replace all your solar panels. 24/7 reliability and baseload stability. It's unsurpassed in its ability to stabilize national grids. Not many people understand how national grids work. Our grids, our power source is all 50 Hz. You probably heard that. That's driven by the massive thermal steam generators, of which coal and nuclear both generate steam. And they drive turbines at 3000 RPM. That gives you your 50 Hz when you plug your appliance in.
Our whole world is built on 50 hertz. In America it's 60, and to change that to DC would cost a gazillion dollars. We've got to stick with AC 50 hertz, and this is the best way to produce it to stabilize the grid. If you have too much DC or inverted DC coming into the grid from a thousand different points, it's very hard to control that 50 hertz capacity factor. Over 93% in the U.S., so these nuclear power plants are churning out 50 hertz megawatts of electricity day in, day out at 93% or more of the time that they're available. Renewables typically have capacity factors mid-20s for solar, 30%-35% for wind and clean electricity, as Craig mentioned, for the new wave of technology coming down the pipeline, of course, artificial intelligence at the top of the list.
But already we rely on these massive data centers, more so than you would believe. It's quite amazing what gets processed through the data centers today. When you think about banking and logistics and the aviation industry, it's just amazing. Crypto is getting bigger and better, hopefully safer electric vehicles and of course, green hydrogen. So nuclear power is an amazing source of electricity. And it's my firm belief that 50 years, 100 years from now, I won't be around, but the world will use nuclear power as the backbone of its electricity supply. I don't think there's much doubt about that. And we are seeing a lot of countries taking up or getting back in the saddle with nuclear. So 31 countries have signed a declaration to triple nuclear power capacity by 2050. That was just in the COP 29 meeting that was held in Baku.
And the United States is devoting billions of dollars to reinvigorate its nuclear power industry, including SMRs and nuclear fuel supply. Very supportive legislation, and billions of dollars in funding for new enrichment and conversion capacity. The United Kingdom launched a roadmap this year to quadruple nuclear energy. They don't have a heck of a lot, but that's a big increase. 24 gigawatts. U.K. government is investing into new reactor builds and have recently advanced their small modular reactor selection process. They've got now four contenders for their SMR program. European Union have included nuclear in their taxonomy relating to their tax structures. France has announced the construction of up to 14 new gigawatt-scale reactors, large-scale reactors. So France is going to continue along its merry way. By far and away the greenest country on the planet. Right in the middle of Europe.
Eastern European countries are also starting to move forward with new nuclear power programs, and Asia, well, Japan's getting back in the saddle after such a devastating event in Fukushima, which affected us all. Korea is charging ahead after having some wobbles. Philippines is resurrecting its nuclear program. They've built a reactor that was never used, so they're looking at getting that going again and some more, and there's several other Asian countries considering nuclear power, so in the U.S. we have the ambition to triple nuclear energy capacity by 2050, so that's another 200 gigawatts of nuclear capacity. That's like 200 large-scale power plants and that is needed to reach net-zero in the U.S., so the plan is to add 35 gigawatts by 2035 and then 15 gigawatts a year after that.
So there's quite a few countries around the world that are really getting their act together with nuclear power and those countries that don't look at nuclear power when they really should are going to be left behind. And I guess Australia falls into that category somewhat. So in terms of nuclear power growth, again nuclear right up there in terms of growth compared to other sources of electricity. On the right-hand side we see the current trajectory for new power plants with 439 operating today, 66 more in the planning stages committed to 87 planned and 344 being sized up in other countries. So eight new countries are joining the nuclear club, Bangladesh, Egypt, Ghana, Kazakhstan, Poland, Saudi Arabia, Turkey, Uzbekistan, and there will be more, quite a few more. In terms of conventional large-scale reactor population around the world, there's, as I said, 439 operating today.
The U.S. accounts for nearly a quarter of those 94 and they're notably bringing some of their shuttered reactors back online. You might have seen some of the big tech companies lining up to help bring some of those closed reactors back into play. So the likes of Google, Amazon, Microsoft. Three Mile Island One is coming back online. San Luis Obispo in California. Several other shuttered power plants in the U.S. will probably come back online. China has by far the strongest growth in nuclear power. 57 reactors today and hundreds planned. But sadly nuclear is only a few % of China's electricity production. Meanwhile, the carbon emissions are on a trajectory which is quite steep and scary. France, of course, one of the major players with, as I said, 14 more on the table.
So with all these nuclear reactors, nuclear still only supplies about 10% of global electricity. So that's, it's good but it's nowhere near enough. We really need to see that number triple or quadruple over the next 30 years or so and there's a good chance it will. And if that happens, we'll have to dig up a lot more uranium, we'll have to do a lot more conversion and we'll have to do a lot lot more enrichment in GLE's home market in the U.S. The U.S. currently imports around 95% of its uranium, has for the last decade on the left hand side there, and has also imported its enrichment requirements to the level about 70% of its requirements over the last decade. So the U.S. over the last 20 years has been asleep at the wheel. They let their nuclear infrastructure completely fade.
And so that is why the U.S. government now is trying to correct those years of neglect. There's quite a bit of opportunity even in today's market. In the U.S., uncovered uranium demand is in excess of 25 million pounds a year from 2030 onwards. That's a lot of uranium that still needs to be contracted in the utility market in the U.S. and the same for uncovered enrichment demand on the right. At least 3 million SWU is still up for contract from 2028 onwards. And really you wonder where that's going to come from. So looking at today's situation with the nuclear fuel supply chain, we've had this slide in our deck for some time, but it's very important. It shows the first, the four steps to create nuclear fuel.
Uranium production, typically from uranium mining, conversion, that's converting the uranium oxide into uranium fluoride, which is required for the next step, of course enrichment which is today done by centrifuge and then the enriched uranium goes off to be made into fuel elements before going into the nuclear power plant. So Western supply chain recent history is characterized by curtailments and underinvestment in resources and production capabilities. The whole Western world has been at fault here and become far too reliant on Russian sourced fuel. So the exposure and over dependence on Russian sourced nuclear fuel is quite significant. Now if you take Russian supply out of the conversion industry, there's only three Western suppliers. Our partners, Cameco, the French, Orano and the US plant ConverDyn.
And if you take the Russian component out of the enrichment industry, there's only two Western enrichment companies, Urenco, tripartite Dutch, German, British organization that do have a plant in the US, the only plant in the US, and Orano, the French. So the Western fuel supply chain is quite precarious in the absence of Russian fuel. And for HALEU there's no Western suppliers currently and so there's a program to establish HALEU production in the US as well. Most of the SMR developers were signing up with the Russians to supply their first 10 years of fuel. So that's not going to happen now. The extent of Russian influence is shown here. The bottom line, enriched uranium fuel. Russia has about 44% of global enrichment capacity with its centrifuge plants.
Today the European Union still relies on Russia for about 30% of its enriched nuclear fuel and the U.S. relies on Russia for about 27% of its enriched nuclear fuel. Some big issues there and that's caused pricing to rise dramatically over the last few years. Uranium was already on the way up before the Russian invasion of Ukraine, but has continued up quite strongly today. Around $80 a pound conversion jumped at the Russian invasion of Ukraine and has continued under extreme supply pressures. Likewise enrichment prices took a huge leap after the Russian invasion of Ukraine and continues to rise ever steadily. The trend in pricing is steadily upwards and very strong situation for GLE to enter the market in. There's four legislative initiatives undertaken by the U.S. Government.
The Inflation Reduction Act, which I mentioned, came through in August 22nd with $700 million of support for the HALEU Availability Program. But there is a component of that which GLE is eyeing off. It's $100 million of funding to support novel nuclear fuel technologies. So we will see how that plays out over the coming months. Nuclear Fuel Security Act, which passed last December, carries the $2.7 billion of funding which was actually triggered by the Russian import ban. And that is the subject of the DOE's LEU acquisition RFP to which GLE bid in September. And we expect news on that in the next few months. And then the prohibition of the Russian uranium imports, which will see Russian fuel banned from 2028 until at least 2040. And there's also another initiative called the ADVANCE Act which supports more funding and greater efficiencies in the U.S.
Nuclear Regulatory Commission, which is responsible for licensing everything nuclear in the U.S. and has been the subject of some criticism for its inefficiencies, so hopefully that will also help, and then GLE has four letters of intent signed with four of the largest nuclear utilities in the U.S., Constellation Energy, Duke Energy, Dominion Energy, and another fourth who want their name withheld, and these relationships are being developed in the background towards potential relationships, commercial relationships. The message here is that all these U.S. nuclear utilities are very keen to see GLE succeed and they're willing to support GLE materially in getting to market, so we'll probably see some more developments on that front as well, so we're making significant progress towards our pilot demonstration project, TRL 6 demonstration. The integrated large scale pilot demonstration facilities.
Essentially virtually a full-scale production module that includes two full pilot-scale laser system modules that were designed, constructed and commissioned and tested here at Lucas Heights before being shipped to Wilmington. That's all up and running. The Nuclear Regulatory Commission came earlier in the middle of the year and undertook its operational readiness inspections and authorized the loading of the gas which occurred in August and so now the pilot demonstration facility is operational and we have preliminary testing underway. The TRL6 demonstration will include the completion of an independent assessment by a top-tier U.S. Q-cleared. They've got all the security clearances. Independent engineering contractor. Probably everyone would have heard of their name. They wish to remain anonymous so they can get on with their work.
But they have been engaged by GLE to undertake the assessment on behalf of the two owners, Silex and Cameco. It's one thing for Silex and GLE to say we're going great, but it really needs an independent voice and assessor in there. So they will be running the assessment process for the TRL6 demonstration and we currently have them coming in very early in the new year to start their assessment at this point. So all up, we still are anticipating the TRL6 demonstration to be completed well ahead of the original schedule, which was the end of next year. Timeline. We have multiple activities going on right now with the TRL6 project. The drafting of the application for the NRC license is well advanced. Now there's a full team of people working on that application. It's a huge lift, heavy lift, probably a couple of thousand pages.
We benefit of course from a previous license that was obtained from the NRC for the original plant that was planned for Wilmington, North Carolina. There's a lot of, a lot of benefit from having done this before. It's not the first time through with the NRC. That application is scheduled to be submitted to the NRC in June next year. There will be a preliminary submission for the environmental report in the next month or so. We understand in parallel there's some early feasibility assessment going on in terms of plant economics that'll become a serious feasibility assessment in the next year or two. Much like a final investment decision required for significant investment in the first commercial plant in Paducah.
Of course, following that will be engineering, procurement, and construction activities for the Paducah Laser Enrichment Facility, leading to operations towards the end of this decade. Getting back to the triple opportunity, we've talked about the first one, which is the production of natural uranium hexafluoride from legacy depleted tails inventories that are stored at the site in a DOE site in Paducah. And when you analyze that in terms of a mining operation, so this is like an above ground mine. All the ore is contained in cylinders in storage yards. But if you can equate that to a mining operation, it's equivalent to a mine producing about 5 million pounds a year for 30 years. And that's on the back of the agreement I mentioned before between the GLE and the DOE signed in 2016.
That is a huge project that is effectively the largest uranium resource in the U.S. by a stretch, and then adding to that opportunity, continued enrichment of the natural grade UF6 to low enriched uranium LEU and LEU plus grades. LEU plus is now being requested by some of the utilities to put in their reactors so that their reactors can run for longer periods between refueling and produce better economics, so that typically LEU is assays of around 4%-5%. LEU looks like being around the 7%-9% range, so that's all requiring more enrichment, and then of course high assay LEU for next generation advanced reactors, including small modular reactors, so quite a lot to talk about there with the triple opportunity and very exciting for GLE to be coming to market at this time.
This, this conceptual schematic shows what the PLEF might look like one day in the future. It's not going to happen overnight, but we hope this is what we end up seeing here. The Department of Energy first-generation gas diffusion plant is that section in the top-left corner of this picture. You can see, basically you can't see the buildings, but all around those buildings is acres and acres and acres, hundreds of acres of cylinders that store the depleted uranium hexafluoride that came out the back door of that first-generation gas diffusion plant. There was a lot of good uranium left in that material. With our highly efficient laser technology, we can go in and process that material. Especially with higher prices for uranium enrichment today, we can go in and process that material and produce effectively natural-grade uranium again.
It's like an above-ground uranium mine. That would happen in the blue section there at the rate of 2,000 metric tons a year, which in mining language is the 5 million pound a year production. If we keep enriching that, or GLE keeps enriching, that would happen in the left-hand building there to produce LEU or LEU plus. If things go really well, there's future expansion potential to add on an ongoing basis. In the green building, a smaller facility to produce some high-assay LEU. That next slide here just shows.
The p rocess flow from depleted tails, top left of the blue section, the blue building, to produce natural UF6 and UF6. About a quarter of that feed would become natural grade, and three quarters will be doubly depleted. Now it's been depleted twice, and that will go back to the Department of Energy for remediation, and then going to the next step from natural grade to LEU in that gray building that I just showed. So I'll leave that for your own reading. But now we'll address some of the economics for the first opportunity. The Silex natural UF6 production opportunity is obviously the baseline project that has been in place for a while. It's akin to a Tier 1 uranium resource based on its low cost and longevity production. We've done extensive modeling over the years of this plant. The plant costs are quite detailed.
Engineering model feeds the cost model, that feeds the economic model. So right now our all in costs, that's CapEx OpEx sustaining CapEx cost of payments to the Department of Energy for the feed material and also embedded in that is royalty payments from GLE back to Silex for the technology license which was, which was our position in the venture before we restructured GLE in 2020. So all those costs accounted for on a mining equivalent basis. Our production for uranium is less than $30 a pound, which is in the bottom quartile of the global cost curve. So that's very attractive. As I mentioned 5 million pound a year for 30 years, huge resource there. The value of the conversion, because our feed is already converted, it's stored in those cylinders as the hexafluoride and that today is about $45 a kilo and different units.
I don't know why, but uranium is pounds, conversions, kilos, and to make things even trickier, enrichment is in separative work units, but anyway the conversion value is about two million kilograms of conversion each year on top of the five million pounds of uranium, so quite quickly you can see a sizable revenue stream there just from the first opportunity and then the other two opportunities would add more value, so here we have some live pictures from the Paducah site which is undergoing site characterization for the NRC license. There's a drilling team, a field team out there. I think they've largely finished the sampling of the soil, but this just shows you where we are with this project.
It's shovels in the ground and taking real samples and starting to characterize the site, firstly for the NRC license but ultimately hopefully for the first plant to be built there. And this is GLE's new headquarters on the other side of the river in Wilmington. So the test loop and former offices were located on GE Hitachi's nuclear plant campus on the eastern side of the Cape Fear River. It's a huge complex. They've also got a GE aircraft engines plant at that site, but we were in the nuclear plant and the test loop is still there at the GE Hitachi site. So GE Hitachi are our landlords now since they left the project. And that's where the TRL6 demonstration is occurring right now. But this new facility is on the other side, the western side of the Cape Fear River.
It's 70,000 sq ft, still use feet in America. It's a huge facility and you can see some of the gear out in the machine shop. This is a huge machine shop. This is going to manufacture a lot of the classified components that go into the plant. So this is a huge investment and we're very excited. It's just fantastic walking around that facility. So, just to finish uranium, the GLE value proposition for us, for you, is twofold. Firstly, our equity position. Currently we hold 51% of GLE and Cameco 49%. But as you're all probably aware, at the time we restructured, Cameco requested an option to acquire an additional 26% so they could go to 75%. That's where they want to end up as a majority owner. We're all okay with that as long as we get our fair market value for the 26%.
So that discussion went offline probably a year ago now. We signed an NDA with Cameco, so I can't really tell you anything more about that, but that option window opened in February last year and we'll close roughly 30-36 months from now. So we have a significant equity stake in GLE as a potential nuclear fuel supplier. In either case, whether we're 51% or 25%, that's pretty meaningful for Silex. And if we do end up transacting the 26%, then that will be at fair market value. So it's an attractive business case for us as an equity owner in that triple opportunity. And again, just to repeat, there's very high entry barriers into this industry. There are some startups running around now. As soon as the government offers money, you get startups coming out of the woodwork, but they're a long way behind us.
The second value proposition is through our license, which has been there since day one in 2006. So GLE licensed our uranium laser enrichment technology back in 2006 and that is still in place. It's a fantastic agreement. Because we can't publish patents, it's classified technology, there's effectively no sunset on the IP. Normally your IP runs out when the patents drop out. So this led to negotiation of a perpetual royalty for the Silex license, at least 7% and up to 12% of GLE's enrichment SWU revenues. And we just give an example here, which would be operations in the blue section and the first section, the gray section on the right would equate to about 8 million SWU of operations and at the lowest royalty rate, 7%.
And at today's enrichment price of $160-odd a unit, that would result in a royalty payment from GLE to Silex of $90 million every year. So the royalty is very valuable to us. So that's the end of the uranium section. I'm just going to touch on silicon quantum computing, artificial intelligence. Obviously, quantum computing is coming down the pipeline. It's going to provide literally a quantum leap in artificial intelligence. It's just going to be a dramatic increase in computing power. And so that will create transformational technological advances in very complex industries, including generative and creative AI applications, defense, aerospace, finance, medicine, global logistics, aviation. I said aerospace. So yeah, a lot of these very complex industries will thrive on the computing power of quantum and become more efficient and that'll help the climate as well when we run these systems more efficiently.
Government and big corporates around the world are chasing this holy grail of computing, including Intel, Google, IBM, Microsoft, Amazon and others. Basically, if you're not in the race, you get left behind, then you will suffer. Thankfully Australia has a very world-class effort in quantum computing on several fronts, particularly silicon-based quantum computing and is a key Australian government policy priority. It comes under the AUKUS Trilateral Security Partnership under Pillar Two. Pillar One is the submarines, but there's a lot more to the AUKUS treaty than that. It is front and center even in Australia. Quantum computing, the favorite for technology in terms of quantum computing has to be silicon. Because we've had 60 years of development of nanofabrication expertise and capability in the silicon chip industry, conventional chips, so all that can be applied to quantum chip manufacture.
Because we're already down to the atomic scale, we're down below 5 nm architecture nodes in conventional silicon chips. And so that's opened the door now for manufacturing quantum based chips using silicon. The only problem with silicon is you have to use very highly enriched silicon 28. And most of that was coming from Russia. So all these organizations around the world, including our partners UNSW and Silicon Quantum Computing, have limited stockpiles of enriched silicon and they can't buy any more from Russia. So this is an important step for us to help form a reliable supply chain for enriched silicon and help the commercialization of quantum computing in the Western world. So our current project started in August last year. It is in conjunction with Silicon Quantum Computing Proprietary Limited, the spin off from UNSW and UNSW itself.
The project is leveraging the success we had in the stage two project, which was 2021, 2022, 2023, 2020, 2020, 2023, in which we demonstrated production of extremely highly enriched silicon. 99.998%. So the 3.5-year project is more than halfway through, as I mentioned before, AUD 5 million from the federal Government's Defence Trailblazer program and also over AUD 4 million from our offtake partner SQC. We expect to be able to produce at least 10 kg or up to 20 kg of enriched silicon. The market's not very big yet, it's tens of kilograms. But once the research and development phase moves into engineering, then the demand will hopefully increase dramatically to hundreds of kilograms. This is a material that the Russians were selling to the Western world players for about $500 a gram, so $500,000 a kilogram. So this is very valuable stuff.
With that material we'll produce two products, quantum silicon gas for most of the industry that uses chemical vapor deposition for making its chips, and then a solid product for those that use molecular beam epitaxy, so there's solid and gas products that will be made, and so a new emerging opportunity is also being explored with conventional chips that recently emerged, so the chips that are used by the big players today for AI data centers and cloud computing, this is your NVIDIA chips and your really large Intel and other chips. They're running into power density barriers. You just cannot pack any more transistors onto these little chips which, well, actually some of them are quite large, so the size of a 50-cent piece. Does anyone know what that looks like? So they're very, they're very concerned about the power density, the heat buildup in these chips.
And there's a lot of research going on using enriched silicon nanowires, so tiny little structures that are laid into the structure of the chip to help carry the heat out. And so far it looks like the enriched silicon heat pipes will provide about 150% increase in thermal conductivity, which is quite dramatic. So we're keeping an eye on that one. Could be quite interesting as a second opportunity for enriched silicon. So we have front-end processing, then we have the laser enrichment step in the middle and then we have the back-end product processing. All that in the green box is what we do at Silex. And then we will sell those products to the chip makers.
And finally, just to touch on medical, lutetium-177, which is a radioactive isotope, is used today to treat advanced prostate cancer in the U.S., the U.K., and the E.U. It's a breakthrough technology called targeted beta therapy. If you Google that, you'll hit thousands of references. So this is a dramatic innovation in cancer treatment, first off prostate, but it's also in clinical trials for several other cancers, breast, endocrine, a whole lot of other cancers. The only problem is to make lutetium made in a nuclear reactor with neutron absorption, you need to start with enriched ytterbium-176, which isn't easy to come by. And guess what? The only place you could get it from was Russia. So that supply chain has also been disrupted.
And right now there's a lot of medical companies, nuclear medicine companies around the world wondering where they'll get their next inventories of enriched ytterbium. So our project, a three-year project, is in stage two. So we've identified the process we now need to show that it's scalable and we expect that to take another few months and if all that goes well, then we'll start scaling that technology. Interestingly, our landlords at Lucas Heights ANSTO are the main supplier of lutetium- 177 to the Asia-Pacific region, of course, including Australia, and they're quite concerned about their future inventories of enriched ytterbium. So this is a really nice project, of course, to help with a breakthrough in cancer treatment. But it's also quite important to be able to provide a supply chain in the Western world.
And again, this material is priceless, apparently, and we have this on good authority from several sources. This material was selling for $20,000 a gram. Obviously you get a lot of patient doses from a gram, but at a kilogram, $20 million, that's worth more than diamonds anyway. We'll see how that goes. Long way to go. Still earlier stage than silicon and uranium. So to end off our summary, GLE's path to market is underpinned by our Paducah Laser Enrichment Facility project for the production of natural grade UF6. And the significant value of the conversion contained in that inventory. And the triple opportunity more broadly includes the potential to add Silex enrichment technology to produce LEU, LEU+ and HALEU at the Paducah multipurpose commercial plant in the future and that will all help alleviate Western nuclear fuel supply chain dependence on Russia.
The acceleration of the pilot demonstration project continues with the test loop facility operational and preliminary testing underway, and the budget this year also provided for all those activities that I went through: the commercial efforts including licensing, early stage activities related to the Paducah plant, and things like the RFP submission. It's quite a sizable commercial team in place now. Silex represents unique leverage into the nuclear fuel supply chain. Significant potential value through equity ownership in GLE currently 51% and additional significant potential perpetual royalty flows under the Silex uranium enrichment technology license agreement. Quantum silicon in stage two to produce or construct the first production module and establish sovereign capability for the supply of enriched silicon for the quantum computing industry. Lastly, the medical isotope project, the first being ytterbium-176. We're in great shape.
I don't think I've ever been more excited after 26 of these or up to 25. My 26th. My hair is a bit thinner, but I don't think I've ever been more excited than I am today. And I think I'm hearing a lot of excitement from shareholders, and I thank you for all hanging in there. Some of you have been on the journey through the tough years after Fukushima. That was a tough period. It almost ended us. We scraped through Fukushima, and here we are. Everything's turned around 180%, 180 degrees at least. And we are in great shape moving forward and with the technology that certainly America is waiting for and hopefully the global community, nuclear community and enriched materials. So thank you for being on the journey, whether it's been for 26 years or two.
Hopefully we'll share some exciting times over the next 12 months. Thank you.
Michael, I'm sure you'll get one or two questions, so thank you for that. Grab yourself. We know we only come together formally like this with U.S. shareholders once again, so I want to make sure that, you know, really kind of comprehensive overview. That's why Michael put so much effort into his preso. Let's go to the room first. If we've got any questions? I'm sure a number will be for Michael. If there are any of the others around the table, we'll direct them and then we'll check if we've got any online, so we have any questions in the room right up the front?
Good morning, Michael. I've been with you for 23 years now, so just going back to your slide on the opportunity for Paducah, you used and it was great to see that you used the figures in there of the array arriving at $30 a kilo or $30 a pound to do that. Can you give us some color on the breakdown of the figures that you've got there? Specifically the CapEx that you would have used to arrive at what the plant's going to cost, as to what you've used in the percentage for Silex payment, I'm presuming it would have been at the lower level of 7%, but can you give us some color on that please?
My short answer is no. I can't provide you with breakdowns because we haven't gone public on that and we don't want to tell our competitors too much about our economics. I can tell you that less than $30 a pound includes everything. So that was the key point there. It includes CapEx OpEx sustaining CapEx payments to the DOE for the feed material, payments for the royalty from Julie back to us. So everything fully loaded.
I was hoping to get some. So the other part of the question, Michael, was in that range of 7-12 around the royalty side. Have you got any comments on that?
The royalty rate? 7%? Yeah, yeah, I think it will be around 7% for the first plant. Obviously, when you build more of something, it gets, it's levered to the CapEx per unit output, and that's calculated every year, so as we add more capacity, you hope as you build more you get more efficient, your supply chain gets a bit cheaper, and the CapEx for added capacity slowly goes down, and that would drive our royalty rate up. That's right. Thank you.
Thanks.
Good morning Michael. Thank you again. Another 26-year veteran. Just a quick question on the Cameco option mechanism, the fair market value mechanism, how precisely is that prescribed?
Is it a? Does it go deeper than the phrase fair market value or is there a strict procedure for establishing that fair market value?
I'm going to have to say no again. No, I mean the point here is that we're under embargo, but you can look at analysts' calculations of discounted cash flows and NPVs to get an idea of how you calculate from bottom up what that fair market value might be, and then there's of course the ASX top down valuation which if you look at what is of value in Silex like 90% of our value is GLE. So that gives a top down valuation, if you like, of our share of GLE.
The uranium price might have an impact. Well, but that's a.
Sure, it'll.
I'll go to a process answer rather than a number answer, Michael. Quite right. We're staying away from anything we may be discussing. Fair market value would be considered. If Cameco believe value X and we believe value X and it's fair market value, you strike it. Right. So that's. But Michael's indicated some of the drivers which would go into that there's a mechanism if we can't agree, Cameco exercise the option as to how an arbiter would then have to determine what their market is. Right. So that's the heart of the.
Yeah. There's binding arbitration if we can't agree. So that's public knowledge. Yeah.
Just one supplementary question. To what extent with the enriched silicon projects? To what extent? I understand there's quite a lot of discussion about manufacturing certain advanced materials in space. To what extent is that an opportunity or a threat for Silex Silicon endeavors?
Well, I mean I don't think we need to move to space to manufacture. So I don't know. I mean I think that's out there literally. Thank you
Yeah. Hi, Michael. Another 26-year guy. I was much younger when I first invested just around your TRL6 testing and your private assessors that are coming in early-ish next year. I imagine you guys want to have a pretty good play with that plant before you bring your assessors in and be pretty satisfied that it's behaving itself. Can you give us any bit more info on what you've seen so far in this testing?
No.
That'S fine.
Okay. No. All right, I'll try. Look, I'm very comfortable with the way things are going. We're still way ahead of the original schedule. We're not going to give a blow by blow description. The reason, the primary reason for that is that we don't want to preempt the independent assessor. So anything, any update that we might give will be in consultation with the independent assessor. We can't come out and say something that they don't agree with or they're not fully on board with. So that process kicks off in the new year and whether there's an opportunity to update sooner than later, we'll see. But you know, we're not talking about far away in the whole process. So yeah, I mean it's best we just get on with the job of finishing TRL 6 and then report back with the independent assessor's report.
Thanks for that.
I didn't want to be rude.
Just another question. What are you doing sitting up the back of the plane when you go?
To the Stat es? Well, we have a company policy. It's premium economy and you know, just to be candid, I mean I've got a few points, so I apply for upgrades, but we're using your money wisely.
We've got one the next row back and then a couple of rows beyond that.
So.
Good afternoon, my name is Gary Leslie, a shareholder since USEC pulled out of the arrangement way back. But my question relates to Wilmington and you stated some time ago that they were going to relinquish the license. Is that going to happen still or is it going to continue on that GLE hinted that there was going to be something from Wilmington?
Oh, you're talking about the NRC license? Yes. Yeah. No, the NRC license for Wilmington was relinquished.
Wasn't.
Yep.
Right. Is it going to continue on now though or what?
I don't think we need a license in Wilmington. Right.
Okay, that answers your question.
It's all our focus. The commercial is Paducah.
We've got a question. We'll go to the lady in the pink and then over to the. Sorry, what color would you prefer me to say? Okay, yeah, up the back.
So just following on from the question up front. You said that you started work on TRL 7 and 8, so that clearly means you're very confident with 6.
No comment. I said I'm comfortable. I sleep well at night. Michael, in the pink. Just a question on the GE-Hitachi and IQE. Is that like in the deep freeze now? Yeah, look, IQE are in a long down cycle for their part of the business, so they've put it on ice for now, but they refuse to give up the license. So they still want the license.
So let's throw to Julie if we can, around the royalty payments because mine's. They're still paying their royalties back.
Yeah, it's part of the Silex technology.
Can you use the microphone?
We were to receive six years of minimum royalties under the sale agreement for the technology and we're still receiving those, so it's quite positive. Last year's royalty was, I think, $500,000 received earlier in the year, so we're hopeful that they'll pick up the technology again along with it.
So they haven't put it fully to bed yet because they're paying us. There's a few over to the left now. Thanks. It appears a lot of our success.
Is going to be due to the political landscape of the U.S. with the c hange of administration next year, do we?
See that as an opportunity or more of a threat?
What's our thinking now?
I don't think there'll be much change at all, although you can never be sure with Mr. Trump. But the Republicans and the Democrats for the last few years have been very supportive of nuclear, so there's strong bipartisan support and I think that'll continue no matter who's in the White House. Thanks.
Michael, could you provide any more color and commentary around the decision for GLE not to apply for the DOE's RFP for HALEU?
Sure. So you can see just from this, it's schematic, but where is it? I'm going the wrong way. The little green building at the back is conceptually what we do for HALEU and we're talking about relatively small volumes. The market does not even exist today, so there's a huge market risk. It depends on SMRs coming to market that need HALEU. Not all SMRs need HALEU. In fact, probably the shift is towards downsized boiling water reactors and pressurized water reactors, which are the large reactors that we use today, just downsizing them and now we'll use HALEU. So as far as HALEU goes, there probably will be a market that evolves in the 2030s. But GLE's opportunities, by far the natural UF6 opportunity and the LEU opportunity outweigh anything on the HALEU horizon.
It was a decision made that, and also the structure of the funding was also going to be a little protracted and complicated. Everything just stacked up the wrong way for GLE, and GLE decided not to bid and to keep its focus on the main game, which is the natural UF6 and the LEU opportunities. That's not to say GLE won't do HALEU either. I mean that $100 million of novel technology has to have a HALEU focus. We'll see. Too early to say.
Got a question for Julie. Just comment on the cash burn for f unding your share of GLE as well as cash burn for at the head company level for all your other stuff.
I mean you can see our cash burn for last year in our annual report. We are still finalizing the budget for GLE for CY25 at the moment, but certainly as you can see from Michael's presentation, we would expect a slight uplift to that for next year. And of course we remain very hopeful around the prospects for supplementary funding from the U.S. government under the LEU RFP and hope to hear about that later this year or early next year. Quite comfortable at this stage, but small uplift to last year.
And also. The head company, the head company
So for Silex. Yes, so I was talking about Silex.
You're talking about Silex and our 51% contribution to GLE. Well, you've got 16 mil or 55 mil is the budget this year for GLE. Can you fund the funding, half of that?
That's right. But it's not as clear cut as that because you might recall that our Lucas Heights operation, we are fully funded for that for the uranium enrichment project. So some of that comes back 100% to Silex. We can take this offline if you like. Yeah, it's not clear cut, but when I'm talking about our cash burn, I am talking about parent company level, which includes the 51% that we fund for GLE.
Yeah, the net burn.
I noticed in the annual report you've got over $2 million in license revenue in the U.S. Sorry, we've got. Sorry. Over $2 million in license revenue.
Yeah.
Could you just explain that a bit? It was a positive, pleasant surprise.
The external revenue there is the royalty that we were just talking about for cREO and the rest of that is reimbursements within the company. So you'll see it come out again below the line. But that does include that IQE royalty coming in. So about AUD 700,000 of that is the IQE royalty.
Yeah. The point is we kept the company Silex alive to service our operations with GLE.
Yep. Thanks for your time, Michael. How far behind Silex do you think is ASP Isotopes as a possible competitor?
No, I'm reluctant to talk about ASP Isotopes and LIS technologies other than to say my understanding is they're a long way behind, particularly with laser, and with ASP. They also have another significant issue, and those their operations are based in South Africa, and you can read on the website they're looking at moving to Iceland. Lots of volcanoes there. Yeah, I don't really, I don't really want to say any more about potential competitors, but I believe that we are the only laser technology within cooee of commercialization.
Then, just as a follow-up, did GLE speak to TerraPower?
I can't really answer that question because if they had, then those conversations are probably confidential. Yeah, I mean those companies are active. TerraPower is talking to everyone, so you could assume they've had some discussions. But I mean, I can't really, I can't really provide any details. Yeah, I mean, Chris is drawing attention to the fact that we believe we've got an extremely efficient laser technology. So it is difficult to imagine something being more efficient or lower cost at this point. No, I'm actually a relative newbie. I'll be, what, about 18 years? No, between six. Some of the others. My first AGM. Yeah, yeah, you've got a lot of funds in the bank. Right, and you're obviously spending a hell of a lot of money. When's the money run out?
And also, you know, potential cap rise in the future and we had a disastrous cap rise a bit earlier. Wouldn't like to go down that path again. Well, I wouldn't have called it disastrous. What's the share price today? Well, it's good now.
Yes.
Yeah. Look, can't provide any detail. The run rate we've just gone through, so we've got a couple of years at least. The funding, there's potential incoming funds from the DOE for GLE, which would lighten our load in funding. There's potential transaction funding from the option if that takes place over the next couple of years, and there's always the potential to raise equity if needed down the track, but I can't provide any more detail on that.
Thank you.
Yeah, I'm just going to that comment around the disastrous raise. AUD 4.05 was our last raise. The one before that was AUD 1.27 or AUD 1.31 per shareholder slightly. So if you look at the multiples from now to then, and AUD 113 million in the bank, you do want a well capitalized company. Yeah. Thank you.
Yeah, I mean, you know, we were getting down in our cash then and you wouldn't want us supporting GLE or talking with Cameco about an option with a few dollars in the bank. And the flip side is the higher the value then the less dilution. So I wouldn't have said disastrous at all.
There's a question on competitors. I don't need you to talk about specifics, but your competitors who I've spoken to do talk about how the enriching factors are not higher than yours. Could you cover at a high level?
Why?
Enrichment factor is not the only thing that depends on.
Yeah, okay. So first point is no one knows our enrichment factor. They don't know it. You don't know it. I know it. But you don't know it. They don't know it. So in terms of our process, enrichment factor is one thing, throughput is another thing. And then CapEx and then OpEx. So there's half a dozen key numbers that go into your, your overall cost, of which only one is the enrichment factor. And our enrichment factor is very good. I can't tell you what it is because it's classified and they don't know it either.
Let me make a general comment because there is a thematic here about our disclosures and what Michael can say and can't say. Some other companies we are covered by very strong and quite appropriately when you're dealing with advanced nuclear technologies, disclosure limitations that come from our regulator, come from DOE, come from NNSA. And if we overstep that mark, we put our licenses at risk, we put our company at risk, and we put the technology getting to market at risk. And I would say in a very general manner, it's up to the boards and the officers of those other companies that they're also protecting information if they believe they got access to what should be secure nuclear technology information. We can only report on what we do.
Mike can only tell you about where we are with TRL 6, TRL 7 and all the various other things we're doing at Wilmington Paducah. We can't comment on the discipline or otherwise at others that may be putting themselves at risk or more broadly the regulators or others at risk if they're not abiding by them and don't draw any conclusions from what I've said about what they're doing or not. I don't watch them as closely as some of you might watch them. We look at what we can control. What we can control is the sort of where the sort of work we're doing with the Department of Energy, NNSA, our regulator in Australia and the technology built commercial roll out we're trying to do in the U.S.
Yeah. The only other point I'd add is that they're relatively new. They've only been around for months or a year at the most, and I would be very surprised if they can keep saying what they have been saying at times as they come under the regulatory and security regimes of the governments that they sit under.
We have another question from the front and I can almost smell lunch down there. Another question. Oh, a few questions up the front and then I'll check with Julie if there's any online.
Michael, I appreciate you can't comment on the pretenders to our throne. The latest newcomers is what I'd call them. But there's two comments or two things I got. One of them is allegedly has the CEO of a former employee of ours. Can you comment on what security or protection or non-disclosure is around that? Are we fully protected? And on the second one coming from South Africa that are claiming that they are already supplying the market with isotopes, which I can say I think from my perspective you would find more valuable isotopes on the ground around the stables at Randwick Racecourse. But have we got, can we give any indication as to any evidence of any proof that any of that so-called enriched silicon has come out of South Africa or enriched isotopes have come out of South Africa?
Yeah. Well, again I'm not going to get into detailed discussion of other companies and competitors, but my understanding of what's available on the web is that ASP, which stands for aerodynamic separation process (it's not laser), is what they have built a small pilot plant and produced some silicon. That's all I know. I think the fact I need to move somewhere from South Africa to cheaper electricity tells you something about that process. And you know the pie is big enough for all of us. So just leave my comments there.
Did you want to comment? There was also the front end of the question around NDAs and let's make it general.
Yeah. Okay. So with the former employee of Silex. Yeah, he spent a few years with us on the laser side. He only knew a certain amount about the lasers, and they were the lasers that we essentially decommissioned and got rid of in, was it, 2017. Yeah. So these were prototype scale lasers. We've spent a decade building plant scale lasers. So he wasn't around for that. I'm not concerned about confidentiality. He doesn't know much other than a bit about the lasers we threw out, and we have very tight restrictions and confidentiality, which is mandated by the Australian Safeguards and Non-Proliferation Office. He signed up to that it. He has to live with that for the rest of his life, and he cannot divulge information even if he knew it about Silex Technology. Right, thank you.
Let's go over here then, gentlemen.
Final question from me, not quite sure whether it's Julie or Michael. It's a question about the DOE funding and I'm going to call it because.
I can't remember the name of the act.
Excuse me, to get rid of Russia act of that $2.7 billion in funding, how much has been dispersed because there's just been a tendency from the Biden administration to make big announcements, then slow walk the dollars, and supplementary to that, to what extent of the funds that have been dispersed, do we think the residual will be dispersed before the handover of power or it's gone. It's been frozen by the transfer of power. The incoming change president.
With the initial $700 million that came under the Inflation Reduction Act, all but the $100 has been. Sorry, all but the $100 million. What did I say? I'm talking like an investment banker. Now all but the $100 million has been dispersed and we're keeping an eye on that 100. As far as the $2.7 billion, none of that's been awarded and there is an expectation whether it's firm or not, that that would be awarded before the end of the year. But that's, that's not firm. The fact that the DOE has already awarded the first tranche 700 or $600 million indicates they don't take forever. That was reasonable timeframe. We think it is possible that it will be in the next few months for the $2.7 billion.
Another one up the back. Thank you, Michael.
I don't think that's on. That's not on.
Thank you, Michael. When I sat at the dining room table a couple of weeks ago and read the annual report just like you, I was excited and I congratulate the board. My small question is with the tailings, when you process them, can you leave them there?
What happens with the depleted tails is that there was a slide on this. About a quarter of it becomes depleted tails, about a quarter of it on the top right-hand side becomes natural grade UF6. 3/4 of what goes through that blue plant goes back to the DOE as double depleted. It goes back to the Department of Energy and they sort out the remediation of that material. The quarter that's enriched goes forward to make fuel.
I think there was one final ques tion.
Just this theme about secrecy requirements, government requirements, etc. etc. As a publicly listed company, what's to stop Russian, Chinese, U.S. people buying our shares? And is there anything in place to stop like the wrong type of people buying shares in our company or.
That's a good question. I think that would be monitored by the non-proliferation office at certain points. Now we have a publicly disclosed top 20 every annual report. So if there looked like a major buyer growing a position in that top 20, then I think that would attract the attention of the regulatory authorities in Canberra.
Thanks. Yeah, I'm not sure that's a straightforward answer, but they definitely couldn't, without board-approved approval, take any form of significant stake.
The only point I'd add is that even if you are a 50% or 60% shareholder in Silex, doesn't mean you get access to the technology. So like Cameco is, you know, 49% owner of GLE does not have access to the technology. So they're outside the technology tent, and that's controlled by the U.S. Government, right? Yeah. So Chris is. Chris's point is that's why we have to use independent engineering contractors to make sure Cameco is satisfied that Silex and GLE aren't gilding the lily, which we never would.
Another question over left. Then we'll throw to Julie, who's got one on two, one, one. Just on the back of that, if Cameco does decide to exercise their option for the additional 26% to take it up to 75%, is there anything within the U.S. regulatory framework that will require them to be checked off or passed? Because obviously it's 75%.
Yes, the answer is yes, because we already have governance arrangements, so GLE, Silex, Cameco signed an agreement with the U.S. government already when we did the restructure back in 2020 to get to 5,149. Now that was with us over 50%. If they go over 50%, they have to get a whole new U.S. government approval and the governance arrangements will be even tougher, but that happens all the time in the defense industry, classified technology industry, so they have proxy boards or whatever to help separate ownership from technology intelligence.
So, Julie, on Moly.
Can you just comment on the classification or otherwise of the quantum process and the MIST project?
So it's a good question. We essentially treat everything classified in house, so we avoid any issue of what part's classified, what part's not, you know, whether there's issues around that. We just avoid all that by keeping everything under our classified envelope at Lucas Heights.
So you walk into a class. When you walk into the building, you walk one door in. You walk into a classified part of the building. Need to be cleared to go into that part of the building.
But you can't get to our front door without a pass inside.
Any more, Julie?
Yeah, we've covered that.
Thank you for those questions. There'll be more opportunities to have a good discussion over lunch as well too. There are some formalities to finish with.
Now.
Time to move to the formal business of the meeting.
There you go.
Thank you for that, Michael. So I can just remind you that all the notices of meeting and all the other materials went out ahead of the meeting. We'll close the voting in a very short period of time. You were forwarded the notice of meeting. I'll propose we take that as read. So we're just in a more formal part now. The first item of business is receipt and consideration of the financial reports. As we said, we've got Aish Chandran from PwC here with us to support if there's any questions. So why don't I pause for a minute? Any questions? We've had one or two already around the financial report, but any questions for either our auditor or Chris as chair of our Risk and Audit Committee, or Julie as, our CFO? Thank you. We'll take pauses. No questions there. Any questions online around those, Julie? At all?
All right, then. So I'm about to say now is we've done that. We'll now move to the resolutions, which you can see, at least before anything's passed in this room, how the numbers are going. As Chair of the meeting, I will just remind you that I intend to vote undirected proxies in favor of the resolutions. And I've got one of your little blue forms up there to do that. Any questions from shareholders either in the room or online around any of those two resolutions? Rem report and election of Susie to the board. Thank you. So I'll now note that voting is now closed, so shareholders, proxy voters or corporate representatives attending can now pass or no is about to close. So you do have that blue form. And we will ask Computershare to go around and just pick up those forms as well.
So we got it. Yeah. So I will. Yeah. Susie, I'm going to call you up in a minute. So we all good from the room? So I have had a while, we're just going around. There was a request from the room and I think it's quite a reasonable request if Susie, who's joining the board today, could just say a few words. So, Susie, you're happy to introduce yourselves and say a few words.
Good morning. My name is Susie Corlett and I'm pleased to offer myself for election today as a professional director. My career has spanned 30 years in the mining industry, in operations in mining, investment banking and mining private equity. Originally a geologist, my combination of operational skills and financial risk capabilities have really underpinned a track record of delivering value to shareholders. This has included execution of innovative and technically challenging projects across a range of commodities in a range of jurisdictions. I've had the opportunity to work in 25 different countries on complex multi-jurisdictional cross-border transactions for the likes of Standard Bank, Macquarie Bank and Pacific Road Capital. Disciplined capital allocation and project delivery of large-scale projects have been key areas of focus across my career over the last 20 years.
I expect that a combination of commercial acumen together with technical expertise will serve you as shareholders well. The hallmark of my career has really been judicious risk taking and risk management across the entire resource value chain. I've worked in credit risk management and financial restructuring which has really enabled a relentless focus on margin generation and delivering growth. I look forward to tapping into such experiences to help unlock value for Silex shareholders in the years ahead. I currently serve as a non executive director on the board of Iluka Resources, Aurelia Metals and I'm also proud to be a director on the board of Mineral Resources where I'm playing a central role leading governance changes in what's a very delicate, challenging and sensitive time for the company. Silex stands on the cusp of unlocking tremendous value for shareholders in the future, as Michael has just outlined.
I'm seeking your support for my election so I may be able to contribute to the success of what is a remarkable company. Thank you.
Thanks for that, Susie. Any questions at all?
No.
So, look, thank you. Another terrific AGM from our perspective. Thank you all for your contributions as shareholders, whether they be 26 years or two and a half weeks. You know, we appreciate all shareholders. That brings the AGM to a close. We'll upload the ASX shortly, with the results of this afternoon, with the results of the various polls that we had. And would you like to join us and grab a sandwich or something else for lunch? So thank you very much to everyone.