GoviEx Uranium announces encouraging results of a Preliminary Economic Assessment for the Mutanga Uranium Project in Zambia
Mutanga is GoviEx’s second large-scale, mine-permitted project in Africa positioned for development
VANCOUVER, CANADA – GoviEx Uranium Inc. (TSX-V: GXU; OTCQB: GVXXF) (“GoviEx” or “Company”) announced today that it has completed a National Instrument (NI) 43-101 Preliminary Economic Assessment (“PEA”) for the Mutanga Uranium Project (“Mutanga Project”) in Zambia, which evaluates the economic and technical viability of a large-scale uranium project with low-capital costs and low-operating costs.
Highlights of the PEA include the following:
- The Mutanga Project consists of three contiguous, fully-permitted mining licences.
- The project development plan envisions an average annual production rate of 2.4 million pounds of U3O8 yellowcake over an initial 11-year mine life, with an 88% ultimate uranium recovery rate.
- Initial capital costs are estimated at US$123 million, with estimated cash operating costs of US$31.1/lb U3O8, excluding royalties. Total life-of-mine (“LoM”) costs are forecast at US$37.9/lb U3O8.The PEA is based on Measured and Indicated Mineral Resources of 15 million pounds (Mlb) U3O8 and 45 Mlb of Inferred Mineral Resources.
- At a long-term uranium price of US$58/lb U3O8, the base case project economics for this project are positive, and indicate an after-tax net present value of US$112 million (at 8% discount rate) with an internal rate of return (IRR) of 25% and total life-of-mine net free cash of US$268 million.
Govind Friedland, GoviEx Executive Chairman, commented, “We are pleased by the encouraging results of this PEA. 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. 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.”
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