Shares in nuclear power company Oklo (OKLO -5.32%) rose by a whopping 28% in the week to Friday morning. The move comes in a busy week for the company, whereby events helped encapsulate the investment case for the stock.

What does Oklo do

The company is developing what it describes as "next-generation fast fission power plants," known as Aurora. Its Aurora powerhouse has a few interesting qualities. First, it's based on a fast fission plant (Experimental Breeder Reactor-II) that the U.S. government operated from 1964 to 1994, so the technology is proven. Second, it's designed to operate either connected to the grid or independently of it -- the latter is a significant advantage when reliable power is needed in remote locations. Third, it can run on fresh or recycled nuclear fuel.

What happened this week

The big news this week came with the announcement, on Wednesday, of a notice of intent to award (NOITA) Oklo a project to provide power to the Eielson Air Force Base in Alaska -- an attractive prospect for the Department of Defense because Aurora can provide power without being connected to the grid. Oklo will provide power under a long-term power purchase agreement (PPA).

One day later, Oklo announced the pricing of a public offering intended to raise $400 million to $460 million.

Image source: Getty Images.

Oklo's business model is to build, own, and operate its Aurora powerhouse and sell energy via power purchase agreements (PPAs), rather than selling its powerhouse designs. The upside is that it generates long-term recurring revenue; the downside is that it will require significant capital to build the powerhouses, hence the stock offering, and there is the usual risk of cost overruns in building and operating power plants. Still, the market took a positive view on matters this week.