Namibia buys in to Etango

12 April 2012

Namibian state mining company Epangelo is set to take an active role in the development of the Etango uranium project after Bannerman Resources agreed to sell it a 5% stake in the project for which a definitive feasibility study has just been completed.

Australian company Bannerman has signed a binding agreement allowing Epangelo to acquire an initial 5% interest in its Namibian subsidiary, Bannerman Mining Resources Namibia (BMRN), for a total of approximately A$3.9 million ($4.1 million). The Namibian mining company will also hold an option to acquire a further 5% of BMRN at the time of a decision to mine. Epangelo has four months in which to raise the finance for the initial acquisition.

BMRN owns 100% of Etango and is itself currently owned by Bannerman Resources and a private investor. Should the Epangelo 5% acquisition go ahead, Bannerman's shareholding would become 76% with the remaining 19% held by the private investor.

Welcoming Epangelo to the project, Bannerman chairman David Smith said the involvement of the Namibian company as a key partner designated the start of a new period in Etango's development. The Namibian government last year announced plans for Epangelo to take a major role in new strategic mineral developments, including uranium, although existing exploration and mining licences were unaffected. By buying into BMRN, Epangelo will not only take on responsibility for contributing to BMRN's expenditure, but will also take a seat on BMRN's board and will second personnel to the Etango project team and through education and training initiatives.

Feasibility study in

Etango, formerly known as Goanikontes, is some 30 km southwest of Rössing and 35 km east of Swakopmund, and comprises alaskite ore very similar to that found at the existing Rössing mine. A newly completed definitive feasibility study has converted 80% of the project's measured and indicated mineral resources to the proved and probable reserves category, totalling 119.3 million pounds U3O8 (nearly 45,900 tU).

The definitive study foresees production of 7-9 million pounds U3O8 (approximately 2700-3500 tU) per year for the first five years of production from the site, and 6-8 million pounds U3O8 (approximately 2300-3100 tU) per year thereafter. This, says Bannerman, would put Etango among the world's top 10 uranium-only projects. A mimimum mine life of 16 years is envisaged for the open pit operation, although an expansion drilling program is targeted at adding new mineral resources and expanding that life to beyond 20 years.

Bannerman is seeking a development partner for Etango and says the definitive study means it can now "step up its engagement" with potential partners. China's Sichuan Hanlong group made a takeover offer for Bannerman in July 2011, but the highly conditional offer did not proceed.

Researched and written
by World Nuclear News