A pit re-optimisation, the inclusion of vanadium credits and a change of plant location has turbo-charged Toro Energy’s plan for its WA based Lake Maitland uranium project, leading to a potential 48 per cent hike in uranium production over the life of mine to 23.5 million pounds from 15.8 million pounds and potential vanadium oxide production of 12.2 million pounds.
The company has modelled up the option of a stand-alone uranium mine at Lake Maitland instead of simply including it as part of a broader plan to mine multiple deposits as part of its Wiluna uranium project.
The new model will see the processing plant built alongside the Lake Maitland deposit instead of next to the company’s Centipede deposit around 80km to the northwest.
The resultant cost savings in transport and some processing tweaks when added to a new stream of income from vanadium has substantially changed the game for Lake Maitland. The company now says Lake Maitland could become a stand-alone mining operation that would account for some 78 per cent of the previously modelled wider project production.
Interestingly, the company says the changes and the now updated resource will add another 7 years to the originally modelled 10 year mine life for Lake Maitland.
Importantly it will see the company mine down to average grades of just 370 ppm uranium oxide whereas the previous plan had a 631 ppm average – the end result will see the tonnes mined over the 17 year mine life jump to 35.2m tonnes from a previously contemplated 13.2m tonnes.
The Lake Maitland uranium deposit is just one of four deposits that form part of Toro’s 100 per cent owned Wiluna uranium project in Western Australia’s northern Goldfields region, 710km northeast of Perth.
The four projects are scattered across an area approximately 90km long South-East of Wiluna.
The new study incorporates improvements and potential cost reductions to processing derived from Toro’s research and development activities in the past six years, combined with the cashing in of its vanadium credits.
Toro says the work on Lake Maitland could reveal potentially significant applications to its entire Wiluna uranium project.
Toro Energy Executive Chairman, Richard Homsany said: “The re-optimisation of the Lake Maitland pit is a very significant step towards realising the true value and potential of our 100% owned Wiluna Uranium Project in WA. These results have materially elevated, at a scoping study level, the potential ore to be mined and U3O8 to be produced at Lake Maitland.”
“These outstanding Study outcomes provide us with confidence that Lake Maitland will be transformational for the value of the Wiluna Uranium Project.”
The company will now feed its results back into a final optimisation before fashioning a scoping study level capital cost estimate for the stand-alone operation at Lake Maitland that will also include vanadium credits.
Whilst vanadium is in vogue at the moment, garnering significant interest in the clean technology space, Toro argues the increase in uranium potential will be the real financial kicker of the project – albeit vanadium will add a welcome boost to the bottom line.
The company also holds the Dusty nickel project in WA, where it fired up a diamond drill rig back in March to continue probing its nickel sulphide discovery of 2020. On September 1st the company caused a stir amongst market punters, announcing it had encountered a 2.6m hit going 3.45 per cent nickel from 184.5m downhole.
Notably, Dusty is just 50km east of the world-class Mt Keith nickel deposit, operated by BHP, the ASX’s largest market-capped company.
Interestingly the Geological Survey of Western Australia ranked Mt Keith as number two when it comes to nickel resources, behind Ardea Resources’ Kalgoorlie nickel project.
There is no shortage of economic clout either in terms of Toro’s uranium-focused joint venture partners at Lake Maitland. Japan Australia Uranium Development Company and ITOCHU Corporation have the right to farm in for a 35 per cent interest. ITOCHU is one of Japan’s largest diversified companies, pegged as 72nd on the 2020 list of Fortune Global 500 companies.
According to the World Nuclear Association, uranium demand is forecast to rise steadily from 162 million pounds in 2021 to 292 million pounds in 2040.
Toro has modelled Lake Maitland up at US$70 a pound – higher than today’s price of around US$54. The company is obviously banking on the demand forecast by the World Nuclear Association to impact pricing over time and with the price hiking from US$30 just a year ago to US$54 now, it appears to be heading in the right direction.
Is your ASX-listed company doing something interesting? Contact: matt.birney@businessnews.com.au
By Matt Birney
