GoviEx Uranium Inc. has filed a Feasibility Study for its Muntanga uranium project in Zambia, revealing an after-tax NPV of $243 million and an IRR of 20.8%. The project is set to produce 2.2 million pounds of U3O8 annually over a 12-year period and is significantly influenced by uranium price fluctuations. GoviEx is now seeking financing to advance the project.
GoviEx Uranium Inc., listed on TSX-V as GXU and on OTCQX as GVXXF, has submitted a Feasibility Study for its Muntanga uranium project located in Zambia. This study represents a significant milestone for advancing a rare near-term uranium project, aimed at meeting the rising demand for nuclear fuel.
The Feasibility Study indicates an impressive after-tax net present value (NPV) of $243 million and an internal rate of return (IRR) of 20.8%. The projected operating costs are estimated at $32.20 per pound of U3O8. The project’s economics demonstrate strong sensitivity to fluctuations in uranium prices, revealing that a $5 rise in U3O8 price will enhance the NPV by $45 million.
Muntanga is expected to generate an average production of 2.2 million pounds of U3O8 annually over a 12-year mine life, leveraging Probable Mineral Reserves. There is potential for further enhancement by upgrading Inferred Resources and developing three supplementary satellite deposits. The operation will employ a shallow open-pit mine coupled with heap leaching and standard processing methods, facilitated by robust local infrastructure, including well-established road access, water supply, and grid power.
Additionally, GoviEx emphasized the project’s capability for exportation through existing routes via Namibia, providing access to both Western and non-Western markets. The operational strategies implemented include favorable mining conditions that lower costs, optimized ore processing demanding only a 25 mm crushing size for agglomeration, and low average acid consumption of less than 16.5 kg per tonne of ore, with recovery rates exceeding 90% within a 21-day extraction period. The project is expected to maintain a low grid power requirement of 7 MWp.
GoviEx Uranium’s CEO, Daniel Major, stated that the Feasibility Study confirms Muntanga as a viable operation within a supportive mining jurisdiction. “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%.” He also noted that the project is significantly influenced by uranium price movements, indicating that each $5 per pound increase in U3O8 contributes an additional $45 million to the NPV.
Presently, GoviEx is concentrating on obtaining financing and has enlisted Endeavour Financial as an advisory partner while actively engaging with utilities and strategic partners. Major remarked, “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.”
In conclusion, GoviEx Uranium’s recent Feasibility Study for the Muntanga project underscores its robust economic potential, with significant projected returns and production capabilities. Its strategic location, operational efficiencies, and favorable market conditions position it as a key project to meet the growing demand for uranium. The company’s ongoing focus on securing financing will be crucial to bringing this project to fruition within the tight uranium market.
Original Source: www.proactiveinvestors.com
