Strong Scoping Study Results For The Lake Maitland Uranium Project

Toro Energy Limited (ASX: TOE) (‘the Company’ or ‘Toro’) is pleased to announce the excellent results of its Scoping Study for the proposed stand-alone Lake Maitland Uranium-Vanadium operation, located approximately 105 km southeast of Wiluna township in Western Australia and 730 km NE of Perth.

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HIGHLIGHTS

Excellent financial outcomes

• NPV pre-tax of approximately A$610M at a discount rate of 8%
  
• IRR of 41%
• Payback period of 2.5 years
• Total EBITDA of $1,768.6M
• Total undiscounted cash flow of A$1,423M pre-tax
• Average EBITDA of A$98M per annum
• Average undiscounted cash flow of $81.3M per annum
• Estimates assume a US$70/lb U3O8, US$5.67/lb V2O5 price and a US$:A$0.70 exchange rate

Modest CAPEX

• US$189M (or A$270M) capital cost estimate including contingency and EPCM
• Includes all infrastructure for the proposed stand-alone Lake Maitland operation, including:
  • entire processing facility with beneficiation plant and ability to produce both a uranium and vanadium product; and
    
  • all mining & administration related infrastructure, access roads, power plant, borefield and a reverse osmosis desalinisation plant for water supply
    
• A$133M processing infrastructure build cost (A$95.8M excluding contingency and EPCM)
• A$137M non-processing infrastructure build cost (A$99.2M excluding contingency and EPCM)

Low operating cost estimates

• C1* Cash operating cost of US$15.84/lb U3O8 over the first 7 years
• C1* Cash operating cost of US$23.10/lb U3O8 over Life of Mine (LoM)
• All In Sustaining Cost (AISC)^# of US$20.32/lb U3O8 over the first 7 years
  
• All In Sustaining Cost (AISC)^# of US$28.02/lb U3O8 over LoM
  
• Robust estimate operating margins
• C1 (US$15.84) and AISC (US$20.32) for the first 7 years provides Toro with very strong margins during the initial payback period
  

Mining and Production

• Mine life of approximately 17.5 years
• Low average strip ratio of 1.17
• Process approximately 1.94Mt of ore per annum (front of beneficiation plant)
• Annual average production approximately 1.3Mlbs U3O8 (100% Indicated Resource) and 0.7Mlbs V2O5 (100% Inferred Resource) (refer to precautionary statement above and discussion on production schedule below for further details)
• Total production approximately 22.8Mlbs of U3O8 and 11.9Mlbs of V2O5 (refer to resource table for the Wiluna Uranium Project contained in Annexure A for further information as well as discussion on production schedule below

Management Commentary

Commenting on the outcomes of the Lake Maitland Scoping Study Toro’s Executive Chairman, Richard Homsany, said

“The Board is delighted to report these outstanding Scoping Study results for the Lake Maitland deposit which further highlight the quality and global significance of Toro’s uranium assets. These strong financial estimates and outcomes, driven by modest capital and operating costs, are the culmination of many years of extensive research and development by Toro to optimise the processing flowsheet.

Lake Maitland represents a significant proportion of the Wiluna Uranium Project’s resources, and these Scoping Study results clearly illustrate the transformational effect of the stand-alone Lake Maitland operation on the potential economics of the entire Wiluna Uranium Project.

As global uranium markets continue to strengthen, Toro is pleased to report the cost estimates and outcomes for Lake Maitland are on track to be very competitive globally with:

• an excellent 41% IRR
• short payback period of 2.5 years
• a low C1 operating cost of US$15.84/lb U₃O₈ in years 1 to 7 when high grade uranium resource is being processed
• a strong life of mine C1 operating cost of only US$23.10/lb U3O8
• a low AISC cost of US$20.32/lb U3O8 in years 1 to 7 when high grade uranium resource is being processed
• a strong life of mine AISC cost of only US$28.02/lb U3O8
• a modest total CAPEX of US$140M plus 20% for contingency and 15% for EPCM over a 17.5 year mine life producing a total of 22.8Mlbs U3O8 and 11.9 Mlbs V2O5.
• total EBITDA of $1,768.6M
• total undiscounted cash flow of A$1,423M pre-tax

With continuing feasibility work, Toro is confident that there is significant scope to further optimise these Scoping Study outcomes due to Lake Maitland’s close proximity to Toro’s 100% owned Centipede-Millipede and Lake Way uranium deposits within the Wiluna Uranium Project. It is clear that the potential integration of additional resources from these deposits could increase the production at Lake Maitland and, in particular, extend the processing of high-grade uranium resource well beyond the seventh year of production.”

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