Berkeley Reports Updated PFS That Transforms Salamanca Project Economics

Berkeley Energy (ASX:BKY) announced that an updated prefeasibility study that includes the high-grade Zona 7 deposit has transformed the economics of the Salamanca project.

As quoted in the press release:

The project now has a Net Present Value of US$871.3 million (£580.9 million) with an internal rate of return of 93% based on a discount rate of 8% and a long term uranium price of US$65 per pound. This valuation represents around £3.22 per share on an undiluted and unfinanced basis compared with the current share price of around £0.22 per share.

As previously reported, Zona 7 is a shallow, high grade deposit with impressive metallurgical characteristics located within ten kilometres of the proposed processing plant. Its inclusion in the updated Study has increased the mine life from eleven to eighteen years and reduced the operating costs from US$24.60 to US$15.60 per pound of uranium produced during steady state operations making it one of the lowest cost producers in the world once developed. In addition to the reduction in operating cost, the capital cost to initial production has reduced from US$95.1 million to US$81.4 million due to the lower cost of developing the Zona 7 deposit and the benefits of currency depreciation.

Paul Atherley, managing director of Berkeley, commented:

These outstanding results very much support the Board’s decision to rapidly push ahead with the development of the project. With the major approvals in place and discussions with potential financiers underway we are expecting to commence site works in mid-2016.

Click here to read the full Berkeley Energy (ASX:BKY) press release.