Paladin Energy is preparing for a recovery in the uranium market, approving a prefeasibility study to evaluate restarting its Langer Heinrich mine in Namibia.
Paladin Energy is preparing for a recovery in the uranium market, approving a prefeasibility study to evaluate restarting its Langer Heinrich mine in Namibia.
The two-stage prefeasibility study is expected to commence next month, at a cost of around $8.6 million, with completion anticipated in the third quarter of the 2020 financial year.
The uranium miner completed a concept study at the mine earlier this month, and in a statement Paladin said the study estimated that initial capital funding requirements for a restart would be “relatively low” at approximately $139 million.
It also said it could potentially recover a saleable vanadium product from the mine, boosting its economics.
In May, Paladin indefinitely suspended operations at its 75 per cent-owned Langer Heinrich project due to low uranium prices and increasing expenses.
China National Nuclear Corporation owns the remaining 25 per cent of Paladin’s flagship project.
Paladin went into administration in July 2017, and a restructuring deal left existing shareholders with just a 2 per cent stake in the company.
China National Nuclear Corporation, was expected to purchase Paladin’s stake in Langer, which Paladin said was worth $526 million.
However, CNNC decided they would not exercise their option to purchase the stake.
Paladin chief executive Scott Sullivan said the mine could be in full production as early as mid-2021, allowing it to be a first mover in the market if the uranium price recovery continued.
“The study identified improvements to resolve known processing issues we have encountered in the project’s life to date and also to make well considered, low cost investments in the rapid restart option,” Mr Sullivan said.
“The PFS would also examine Langer Heinrich’s capacity to produce a saleable vanadium product as a way of increasing the project’s long-term value.
“As a co-product credit this would effectively lower Langer Heinrich’s cost of uranium production.
“We have assembled a first class project team with both international uranium experience and demonstrable experience in driving cost and operational improvements in mines globally.”
Shares in Paladin closed trade 2.78 per cent lower at 17 cents each.
