Uranium company says WA Government policy changes ‘warranted' as it produces ‘more accurate' project study
West Perth-headquartered Toro Energy's Wiluna uranium-vanadium project has three deposits, including Lake Maitland, which is 105km south-east of the northern Goldfields town.
The WA Labor Government has a policy banning new uranium mining projects in the State, and Toro's approvals for Wiluna, which were granted in 2016, lapsed in 2021 because 'substantial commencement' was deemed not to have taken place.
The only uranium project in WA with currently valid State approval is Deep Yellow's Mulga Rock proposal 290km east-north-east of Kalgoorlie-Boulder — but this is second in line to the $750 million Tumas project in Namibia, where Deep Yellow recently delayed a financial investment decision as it waits for global prices to improve.
However, Toro has kept its investment in Wiluna bubbling away, and on Wednesday released an updated scoping study for Lake Maitland which it said highlighted a 'robust' case for a standalone mining and processing operation.
Toro executive chairman Richard Homsany said the new study used the recently completed, more accurate resource estimation and re-engineering of the proposed mining operations.
'The result is a more accurate study that clearly demonstrates just how robust the potential economics of the proposed project are, with an uplift of $75m or 9 per cent to a base case of $908m in pre-tax net present value, and a significant reduction in the payback period to a very swift 18 months from the commencement of mining and processing,' he said.
'As we have stated previously, the Lake Maitland deposit comprises a significant proportion of the Wiluna uranium project's resources, so we cannot understate just how transformational the standalone Lake Maitland operation is on the potential economics of the entire Wiluna uranium project.
'These latest estimates at Lake Maitland outline its potential to be brought into production and capacity to generate significant returns when regulatory settings align.
'Importantly, Lake Maitland's upside and quality continue to improve with each evaluation Toro undertakes, further strengthening the case that Wiluna is an asset of global significance.
'Policy changes at the WA State Government level to facilitate Toro's project development and unlock the considerable value in WA's uranium industry are warranted and, in the context of assisting many countries with nuclear power in their energy mix to achieve decarbonisation, are more than well overdue.'
Toro on Wednesday said it believed its State approval remained valid despite not achieving substantial commencement, and it still had the option of applying under the Environmental Protection Act for an extension of time at a later time during the life of the approval.
'It is also envisaged that favourable results from the studies detailed in this announcement may also necessitate an amendment to the proposal the subject of each environmental approval received,' the company said.
The company updated the resource at Lake Maitland last September by 12 per cent to 29.6 million pounds of contained triuranium octoxide — otherwise known as yellowcake — with a reduction in average grade to 403 parts per million triuranium octoxide at a 100ppm cut-off grade.
The study released on Wednesday said Lake Maitland could produce 1.3 million pounds annually of yellowcake across a 16.3-year mine life — which amounted to a total of 22Mlb.
It said the total cost of the project was $298.4m.
The returns were based on a uranium price of US$85/lb — rival Canadian company Cameco estimates the spot price in April was US$67.73/lb.
The study also included the stripping of vanadium from the uranium processing flow stream — Toro said it was liberated from the uranium ore mineral as a potassium uranium vanadate, along with the uranium, during leaching, to produce a low-value sodium hexavanadate as a by-product.
Last September's mineral resource estimate said Lake Maitland had a vanadium resource of 50Mt at 285ppm vanadium oxide for 31.4Mlb at a 100ppm cut-off.
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