Albidon uranium project to cost $93m

West Perth-based African Energy Resources (Guernsey) Ltd and partner Albidon Ltd have elected to proceed with a bankable feasibility study over an African uranium project after a previous analysis pegged total capital costs at $93 million.

Both companies today released results of the prefeasibility study into the Chirundi project for the production of 1.3 million pounds of uranium oxide each year over a 5-6 year mine life.

The project includes two resources, Njame and Gwabe, with the latter to be mined three years after mining starts at the first.

Both companies say that as a result, capital costs are currently pegged at $72 million.

African Resources estimated that operating costs will in the range of $US30-40 per pound of recovered uranium oxide.

"Based on these operating cost estimates, the project yields an acceptable return at the study price of $US65/lb of uranium," African Resources said.

Albidon has a 30 per cent interest in the Zambian project and will contribute $2 million towards the bankable feasibility study.

According to uranium specialists Ux Consulting company, the spot price of uranium last traded at $US60/lb.