EMA eager to move Mulga Rock project into development phase

THE CONFERENCE CALLER: Energy and Minerals Australia (ASX: EMA) chief executive officer Julian Tapp told the Australian Uranium Conference that his company’s recent change of its management structure was a deliberate move.

The move, he said, was to allow the company to focus on moving its Mulga Rock uranium project into development.

“This is a fabulous deposit,” Tapp told the auditorium.

“It is big enough to justify a standalone development; it’s big enough, and will have a long enough life, to be of interest to strategic off-take partners.

“We are targeting a $40 per pound cost of concentrate, which we think is achievable, and it has very good economics.

“At assumed $70 per pound the NPV with a ten per cent discounts rate it is over $330 million.

The Mulga Rock project has an Infrerred Resource of 28,300 tonnes uranium (approx. 62.2 million pounds) at 500 parts per million uranium.

The project is capable of producing approx. 1,400 tonnes of uranium per annum for 15 years.

 

Source: Company presentation

Tapp said although he was unable to say exactly when it may happen, he anticipated the uranium market would improve.

“For those that want to take advantage of that spike in price, now is the time when you have to be investing and moving the project forward, and that is what we are intending to do.”

When arrived at EMA, Tapp said he did so providing he could get the ball rolling to move the Mulga Rock project into production by 2016.

In order to achieve that goal the company has determined a decision to be reached on final investment by 2015.

“That has involved focusing on the existing asset,” Tapp said.

“There is a new deposit that was found, called Princess, the Princess and Ambassador deposits have an Inferred Resource of around 30.8 million pounds between them, which is certainly enough to sustain the first seven years of mining.

“That’s what the emphasis is now going to be on; focusing on that as the front end of mining – doing the testwork on that and getting that ready for it to go into production.”

EMA does have other deposits at Shogun and at Emperor, which have a combined Inferred Resource of approx. 31.2 million pounds, which the company considers could sustain some eight years of mining.

Tapp explained that at this stage these deposits are considered to be more the tail end of the project.