A preliminary economic assessment for GoviEx Uranium Inc.'s Mutanga project in Zambia estimated a base-case after-tax net present value of US$112 million at an 8% discount rate, and an internal rate of return of 25%.
The study envisions an average annual production rate of 2.4 million pounds of triuranium octoxide, or U3O8, over an initial 11-year mine life, with an 88% uranium recovery rate.
Initial CapEx is pegged at US$123 million, with total life-of-mine costs forecast at US$37.9/lb of U3O8, according to a Nov. 21 news release.
The study was based on measured and indicated resources of 15.1 million pounds of U3O8 and inferred resources of 44.9 million pounds of U3O8.
The study assumed a long-term uranium price of US$58/lb of U3O8.
"GoviEx now has two mine-permitted projects — Madaouela in Niger and Mutanga in Zambia — and we can clearly see the economic potential for both of these projects to be developed when uranium prices rise, as expected, as a result of the looming supply deficit forecast later this decade," GoviEx Chairman Govind Friedland said.
"Madaouela and Mutanga each have the potential to produce more than 2.4 million lbs U3O8 per annum steady state, with total life-of-mine costs less than US$38/lb U3O8 and no shortage of exploration potential to possibly expand the mineral resources."
