Refreshed DFS improves Mulga Rock economics

26 August 2020

A newly completed update to Vimy Resources' definitive feasibility study (DFS) for the Mulga Rock Project in Western Australia has demonstrated stronger financial returns than previously forecast for the uranium project, the company says. The DFS Refresh indicates an 8% decrease in cash operating costs over the first five years to USD23.33 per pound, and a 7% decrease over life-of-mine.

Test pits were dug at Mulga Rock in 2016 as part of the DFS work (Image: Vimy)

Vimy CEO Mike Young said the DFS Refresh reinforced the global importance of Mulga Rock, which is the largest advanced uranium project in Australia and has state and federal approvals in place.

"The Refresh has been transformational for the project and moves it into the middle of the uranium producer AISC [all-in sustaining costs] cost curve and on-par with the higher cost Kazakh operations and well ahead of most other uranium juniors," he said.

The DFS Refresh was conducted by GR Engineering Services and included a review of all major capital and operating costs to reflect Q2 2020 pricing and to evaluate ways of reducing the capital and operating costs. Mineral resource estimate, ore reserves, mine plan and schedule, technical design, and metallurgical flowsheet are the same as in the DFS, which was completed in 2018, and annual production of 3.5 million pounds U3O8 (34,657 tU) over a 15-year life-of-mine remain unchanged.

Highlights from the DFS Refresh include: a 20% reduction in capital cost, to USD255 million; an 8% decrease in cash operating cost (C1) over the first  five years to of USD23.33 per pound U3O8; life-of-mine C1 of USD26.02, a 7% decrease; and AISC of USD28.09 over the first five years and USD31.22 over life-of-mine, both an 8% decrease.

Opportunities identified in the DFS Refresh for future improvements at Mulga Rock include implementing new resin technology as it becomes available; the potential for securing lower cost reagent supplies; lower operating costs for calcining; advanced dewatering technology; and the possible use of autonomous haulage systems.

The Mulga Rock Project has a total mineral resource estimate of 90.1 million pounds U3O8, which Vimy intends to mine by shallow open-pit methods. The project is 290 km by road east-north-east of Kalgoorlie in the Great Victoria Desert of Western Australia.

Researched and written by World Nuclear News