2012 startup for Mongolian mine?

13 January 2009

A definitive feasibility study (DFS) of the Gurvanbulag Central uranium deposit in Mongolia has returned positive economics for the project, and suggests that production could start by January 2012 if the necessary government permits are in place by the end of May 2009. The DFS was prepared for Canada-based Western Prospector Group, which owns the deposit, by Aker Solutions Canada Inc. The study indicates that the deposit could produce a yearly average of 1.85 million pounds of U3O8 (712 tU), as calcined yellowcake, over 9 years. It also shows that the project would be economically viable, with an estimated pretax internal rate of return of 9.2% based on a constant selling price of US$65.00 per pound U3O8, which translates to 1.3% after tax. Pre-production capital costs are estimated at $280.2 million with a further $137.5 million during mine life. Site operating costs are estimated at $94.62 per tonne mined, translating to an operating cost of $29.00 per pound U3O8. Extensive underground development to a depth of 560 m was carried out at Gurvanbulag during the Soviet era. Western Prospector Group has held the deposit since 2004.

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