This development programme is expected to result in Paladin Energy having an annual production of around 13.8Mlb U3O8 by mid 2014 from its African projects alone and will demonstrate a progressive increase in production beyond the Stage 3 expansion at Langer Heinrich.
Langer Heinrich Stage 4 Expansion
An extensive in-house study has examined a range of expansion options for Langer Heinrich and has determined that an increase in annual production to a level around 10Mlb U3O8 is sustainable for the current mineral resources, would add significant value to its flagship asset and bring the project to an optimal performance level.
The Stage 4 investigation, initiated in 2008 during the Stage 3 expansion study period, looked at various production levels taking cognisance of the need to maximise value whilst maintaining a long-term production profile. It is believed that with current resources this balance can best be achieved by an annual plant production level of around the 9Mlb U3O, and a remaining mine life of 15 years. Investigations to date also suggest that this can be supplemented by a 1Mlb pa U3O8 heap leaching facility.
The run of mine operation is planned to crush around 8Mtpa at an average grade of 600ppm. This crushed ore will then be upgraded through an expanded scrubbing circuit to give a leach feed grade of around 920ppm. The heap leach feed material is expected to comprise 42Mt of low grade (175ppm) material.
Off-site infrastructure requirements include the installation of a second water supply pipeline and an upgrade to the existing electrical power supply line. Paladin Energy does not believe that there will be any problems associated with sourcing both water and power, because Namibia is planning on increasing the availability of both in the region within the envisaged project development time frame. The key will be to negotiate a reasonable cost base for the additional water and electricity requirements.
To develop the project further, Paladin Energy will undertake a feasibility study, including environmental permitting, to be completed during calendar year 2010 in parallel with in-fill drilling designed to increase the confidence in the current inferred resources and expand the reserve base. This study is not expected to be difficult to complete as there is a vast amount of operational project data and in-house expertise now available across the key technical, environmental and financial areas to ensure its smooth development. This study would be followed by a six-month approvals period and a two-year design and construction period targeting mechanical completion by mid 2013. Ramp-up to nameplate production capacity is expected to take 12 months. The flowsheet for the main plant would essentially remain as present with substantial upgrades in all sections of the plant except for final packaging.
Onsite capital expenditure for the main plant has been estimated at +/-$300 million whilst operating costs are estimated to remain within the $25-$30/lb range of current operations. Infrastructure costs will be determined in the feasibility study and structured financing options with third party ownership will be considered.
The capital cost for the heap leach facility has been estimated at +/-$50 million with an OPEX of under $35/lb, and will undergo a detailed evaluation in parallel with the main feasibility study.
Langer Heinrich is currently in the process of ramping up its Stage 2 expansion to 3.7Mlb pa and implementation of Stage 3 expansion to 5.2Mlb pa is scheduled for completion by late calendar 2010. This latest proposed expansion further emphasises Paladin Energy’s determination for organic growth and its long term commitment to uranium mining in Namibia.
Kayelekera Optimisation
In addition to its plans for Langer Heinrich, Paladin Energy is to conduct an optimisation study at Kayelekera whereby it intends exploiting some additional resource by extending the west wall of the current planned pit. This study
will be targeting an increased production rate of 3.8Mlb pa (from current 3.3Mlb pa) with minimal capital requirement (estimated at $10-$15M) by utilising existing excess capacity. It is expected this production rate will be achieved by mid calendar 2012.
