Worldwide focus, these days, is on low-carbon energy production, which aligns with global sustainability trends, making it appealing to environmentally conscious investors.
The Two ASX Stocks, likely to find favour under such an environment are
Deep Yellow Limited (ASX: DYL)
Deep Yellow Limited is making notable progress with its Tumas and Mulga Rock projects.
For the Tumas Project, the company has appointed Nedbank as the lead manager to handle project financing, while Ausenco Services Pty Ltd has been selected as the preferred Engineering, Procurement, and Construction Management (EPCM) contractor. This selection signifies a key advancement in the project's development.
At the Mulga Rock Project, a hydrological drilling program has commenced to define water management parameters crucial for mining, with several evaluation programs underway to provide key inputs for an updated Definitive Feasibility Study (DFS).
Financially, the company reported a robust cash position of $257.5 million for the quarter ending 30 June 2024, which strengthens its ability to support ongoing and future project activities.
Deep Yellow Limited becomes a strong investment opportunity because of its Advanced Project Portfolio, as DYL is the only ASX-Listed company with two advanced uranium projects—Tumas in Namibia and Mulga Rock in Western Australia. This unique positioning offers diversification and operational stability, making the company less vulnerable to market fluctuations.
Further, DYL actively pursues both organic growth through its exploration initiatives (such as Omahola and Alligator River) and inorganic growth via the consolidation of high-quality uranium assets. This balanced strategy positions the company for future expansion and increased resource potential.
The projects boast a potential 30+ year LoM at Tumas and a 15+ year LoM at Mulga Rock, providing a robust foundation for long-term sustainability and profitability. This extended lifespan appeals to investors looking for stability and reliability in their investments.
Strike Energy Limited (ASX: STX)
Strike Energy Limited announced multiple successful gas discoveries in the Erregulla Deep-1 (ED-1) well in EP469 on September 3, 2024.
The Company has announced two high-quality, low-impurity gas discoveries in the Erregulla Deep-1 well in EP469, with a combined 28m of net gas pay at unprecedented depths for the Perth Basin. The discoveries include 26m of net gas pay in the Kingia Sandstone with 13% average porosity and 7,623 psia reservoir pressure, and 2m in the High Cliff Sandstone with 11% porosity and 7,807 psia pressure. Additionally, a highly prospective over-pressured zone with 4m of net gas pay was found in the Irwin River Coal Measures. The well, drilled to 5,225m, is the deepest onshore in Australia and extends the Permian gas play eastward, where Strike holds 100% ownership in EP503, 504, and 505.
Strike Energy Limited, in its Q4 FY24 Quarterly Report announced on July 25, 2024, highlighted significant advancements across its key projects. The Walyering Project saw gas and condensate sales increase by 7% to ~2.4 PJe, boosting revenue by 13% to $20 million. The Walyering-7 well confirmed a conventional gas and condensate accumulation with 23m of net pay. At South Erregulla, Strike submitted a proposal for an 85 MW Peaking Power Plant and re-certified 82 PJ 2P plus 2C reserves. Meanwhile, West Erregulla received primary environmental approvals, and its gas supply agreement reverted to a previous option. The company also achieved gross sales of 2.4 PJe, including 2.3 PJ of gas and 15,661 barrels of condensate, with total sales revenue rising 13% quarter-on-quarter. Capital expenditure for the quarter was $26.4 million, covering activities such as the Walyering-7 drilling, Kadathinni 2D seismic acquisition, and preparations for the Erregulla Deep-1 and Booth-1 wells. Strike ended the quarter with $86 million in liquidity, comprising $39 million in cash and $47 million in undrawn debt.
Strike Energy Limited is positioned for Substantial Growth, with a targeted focus on key projects and sustainable energy production. While the company faces risks such as market fluctuations and execution challenges, the overall positive sentiment and the potential for significant returns make it an attractive investment opportunity in the Australian Energy Sector for FY24 and beyond.
Source: Company’s Report
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