Deep Yellow said that the Tumas uranium project in Namibia will require an initial estimated capital expenditure (capex) of $372m, based on the findings of the definitive feasibility study (DFS).
The Australian uranium explorer expects a pre-production cost of $48m for the open cut truck and shovel mining operations.
The executive summary of the DFS has been prepared by Ausenco Services.
According to the DFS, the production capacity of the associated process plant has been increased from three million pounds per annum (Mlbpa) of triuranium octoxide (U3O8) as estimated by the October 2021 updated pre-feasibility study (PFS) to 3.6Mlbpa of U3O8.
The throughput at the Tumas uranium plant has also increased from 3.75 million tonnes per annum (Mtpa) during the PFS to 4.15Mtpa.
Deep Yellow stated that the production at the Namibian uranium project at full rate is expected to be for 10 years, while the overall life of mine will reduce from 25.75 years to 22.25 years.
The project’s total mineral resources are 114Mlbs and by treating ore at a rate of 4.15Mtpa, 3.6Mlbs of U3O8 and 1.15Mlbs of vanadium pentoxide are expected to be produced annually.
In addition, the DFS estimates a post-tax net present value (NPV) of $341m and an internal rate of return of 19.2%, with an all-in sustaining cost of $38.72 per lb U3O8.
Deep Yellow said that it will focus now on detailed front-end engineering and design (FEED), project financing, and product offtakes prior to a final investment decision, which is expected to be made in the first half of 2024.
The Tumas uranium project is anticipated to generate 600 jobs during construction, about 520 direct jobs in operations and 1,900-2,550 indirect jobs.
Deep Yellow managing director and CEO John Borshoff said: “The Board has been suitably encouraged by the outcomes and the confidence it has in the team to continue to deliver and has authorised management to commence Front End Engineering and Design and advance project financing and offtake discussions over the course of this year.
“We also anticipate our application for a Mining Licence will be granted by mid-2023 once the Environmental Impact Assessment is assessed and approved by the authorities.
“If the outcome of these workstreams is positive, and suitable uranium market conditions prevail, we will be looking to make a Final Investment Decision by the first half of calendar year 2024.”
