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JOHANNESBURG (miningweekly.com) – US-based uranium miner and explorer Uranium Energy Corporation on Tuesday reported that a preliminary economic assessment (PEA) report on its Anderson project, in Arizona, had revealed a positive return on investment, with an internal rate of return (IRR) of between 53% and 63% and uranium prices in the range of $60/lb and $65/lb.
The project had a pre-tax IRR of 63% and a net present value (NPV) of $142.2-million.
After-tax, the project had an IRR of 50% and an NPV of $101.1-million, based on a uranium price of $65/lb.
Average production in excess of one-million pounds a year could be achieved, with total output of 16-million pounds of uranium to be delivered over a 14-year mine life.
The base case for the PEA considered conventional mining in conjunction with on-site heap leach recovery, producing an intermediate uranium concentrate in the form of loaded resin, which could be shipped to uranium producer Energy Fuels’ White Mesa mill, in Utah, for final processing.
However, once the uranium was concentrated and loaded on resin, it could be shipped to other central processing facilities.
Further, vanadium was present in the mineralised materials and, although the PEA focused on the recovery of uranium only, future studies would be undertaken to determine the feasibility of recovering vanadium as a by-product.
Meanwhile, total life-of-mine capital, including contingences, replacement capital and additional heap leach pads was likely to amount to $139.2-million.
This would include $8-million for preproduction costs, with the PEA providing for a four-year preproduction period that would include development drilling, mine and heap design, and permitting.
A further $43.9-million would be required as initial capital for openpit mining equipment, mineral processing facilities, site preparation, access, infrastructure, buildings and the initial heap leach pad construction.
Additional capital of $87.6-million for highwall and underground mining equipment would be added during years four to eight of the operation.