Vimy Resources PFS confirms Mulga Rock status

THE BOURSE WHISPERER: Vimy Resources (ASX: VMY) has had a Pre-feasibility Study completed on the company’s Mulga Rock project (MRP).

The PFS was undertaken by Amec Foster Wheeler Australia and AMC Consultants and included an economic evaluation the company said supported its view of the MRP to be one of the best undeveloped uranium projects in Australia with substantial annual production and mine life.

Key highlights to emerge from the Study include:

MRP is an attractive deposit with long mine life and long term source of uranium;

MRP is the third largest undeveloped uranium deposit in Australia;

A total resource estimate of 65.6 million tonnes at 520ppm uranium for a contained 75 million pounds of uranium;

A Life of Mine (LoM) of 17 years with an estimated total production of 50.4 million pounds of uranium; and

77 per cent of the uranium mining inventory for first five years is from Indicated Resources.

The study also determined the project to have a low cash cost and robust financials, including:

C1 operating cost for LoM of US$31 per pound of uranium, including by-product credits;

Robust pre-tax NPV10 of $431 million, 25 per cent IRR and a 3.9 year payback at US$65 per pound uranium; and

A breakeven price of US$50 pr pound uranium (capital payback at 10% discount rate).

Mulga Rock also came out from the study as a low risk project with a low cost mining process utilising a simple open-pit mining operation up to a maximum depth of 74m, and a process plant to use low-cost acid leaching and resin-in-pulp.

The company said the project environmental approvals and permitting are well advanced, while the study also highlighted additional opportunities to further reduce operating and capital costs, which will be incorporated into the definitive Feasibility Study (DFS), which is already underway.

“The team has once again delivered a great result for Vimy,” Vimy Resources managing director Mike Young said in the company’s announcement to the Australian Securities Exchange.

“Mulga Rock is a robust and large uranium deposit with simple geology, mining and metallurgy.

“We are well positioned to ride the wave of demand for uranium as the world turns towards cleaner energy sources.

“We are proud that Mulga Rock will deliver enough uranium fuel to offset the equivalent of 50 million tonnes of CO2 emissions per year or nine per cent of Australia’s total CO2 emissions.”