GoviEx Uranium has filed a Feasibility Study for its Muntanga uranium project in Zambia, which shows a $243 million NPV and a 20.8% IRR. The project is sensitive to uranium price increases and aims to produce 2.2 million pounds annually over 12 years. GoviEx is securing financing to commence production within two years.
GoviEx Uranium Inc. has submitted a Feasibility Study (FS) for the Muntanga uranium project in Zambia, which is positioned to meet the increasing demand for nuclear fuel. With a projected after-tax net present value (NPV) of $243 million and an internal rate of return (IRR) of 20.8%, the project demonstrates significant economic potential, supported by operating costs of approximately $32.20 per pound of U3O8.
The economic prospects of the Muntanga project are highly sensitive to fluctuations in uranium prices. Specifically, an increase of $5 in U3O8 prices could enhance the NPV by $45 million. The project is projected to yield an average of 2.2 million pounds of U3O8 per year over a mine life of 12 years, based on the current Probable Mineral Reserves. There is additional potential for growth through upgrades to Inferred Resources and the development of three nearby satellite deposits.
Muntanga will utilize a shallow open pit mining approach complemented by heap leaching and standard processing techniques, benefiting from robust local infrastructure, including road access, water supplies, and grid electricity. Moreover, the project’s operational plan includes established transportation routes through Namibia for exporting to diverse markets.
Operational efficiencies are notable, with conditions conducive to lower mining costs, optimized ore processing requiring minimal crushing, and a low average acid consumption of less than 16.5 kilograms of sulfuric acid per tonne of ore. Recovery rates are anticipated to exceed 90%, allowing uranium extraction within 21 days under heap irrigation, with a minimal grid power requirement of 7 MWp.
“The FS confirms Muntanga as a robust, shallow open-pit, heap leach operation in a mining-friendly jurisdiction, with an after-tax NPV of US$243 million and an IRR of 20.8%,” remarked GoviEx Uranium CEO Daniel Major. He noted the strong correlation of the project’s economics with uranium prices, stating, “The project is highly leveraged to uranium prices, adding USD 45 million in NPV for every USD 5/lb increase in U₃O₈.”
GoviEx is currently prioritizing financing efforts, having engaged Endeavour Financial as an advisor and initiated dialogues with utilities and strategic partners. Major expressed optimism about the future, stating, “We have already appointed financial advisers to assist the company in securing funding, and with production targeted just two years after financing, I am looking forward to progressing with one of the few uranium projects that can help address the increasing uranium demand in a tight market.”
The Feasibility Study for the Muntanga uranium project highlights its strong economic viability with a significant NPV and IRR. The project is strategically positioned to respond to the burgeoning demand for uranium, backed by favorable operational efficiencies and potential for further resource enhancement. GoviEx Uranium’s proactive approach towards securing financing underlines its commitment to advancing this promising project.
Original Source: www.proactiveinvestors.com
