Bannerman Resources Ltd (ASX:BMN; NSX:BMN) has successfully completed Phase 4 of the Etango Heap Leach Demonstration Plant Program for its Etango uranium project in Namibia.
The completion of Phase 4 test work has now delivered final validation across all aspects of the planned process route for the Etango Project.
The results point to exceptionally good heap leaching kinetics: an extraction of 93% is achieved within only 20 days with low acid consumption and no solvent extraction complications.
By delivering genuine proof of concept via this program Bannerman has definitively proven the heap leaching aspect of the project is feasible.
This further de-risks the uranium project, which will assist Bannerman in its search for project partners.
Bannerman will now move on to the final Phase 5 of the program, which will look to further optimise the process.
Brandon Munro, CEO, commented
“The outstanding results from Phase 4 signal the definitive success of the Demonstration Plant Program.
“The program has conclusively achieved its core objective of technically de-risking the heap leaching process for Etango.
“In validating the definitive feasibility study design parameters and confirming projected performance the program has also identified clear opportunities to enhance the project’s financial performance.”
Background
Bannerman’s principal asset is its 100%-owned Etango Project located near Rio Tinto Ltd’s (ASX:RIO) Rössing uranium mine, Paladin Energy Ltd’s (ASX:PDN) Langer Heinrich uranium mine and China General Nuclear Power Corp’s Husab uranium mine currently under construction.
A definitive feasibility study (DFS) has confirmed the technical, environmental and financial (at consensus long term uranium prices) viability of a large open pit and heap leach operation.
Since 2015, Bannerman has conducted a large scale heap leach demonstration program to provide further assurance to financing parties and generate process information.
Based on the DFS, production is expected to be 7-9 million pounds U3O8 per year for the first five years and 6-8 million pounds U3O8 per year thereafter.
Current mine life of 16 years has significant expansion potential through the conversion of existing Inferred Resource as well as the deposit being open at depth.
Heap Leach Demonstration Plant (Phases 1-5)
The plant program is an integral step towards the Etango project’s detailed engineering and financing phases.
Phase 1 - Commissioning (complete)
Phase 2 - Reproducibility (complete)
Phase 3 - Solution Recycle (complete)
Phase 4 - Solvent Extraction (complete)
Phase 5 - Value Engineering (in progress)
The objective of Phase 5 is to conduct optimisation studies in conventional crushed ore, binders and coarser crushed ore, which again will look to improve on project economics.
Licencing update
Bannerman has had its Namibian prospecting licence renewed, which hosts the 100% owned Etango uranium project.
The renewal of Exclusive Prospecting Licence 3345 will last until 25 April 2017.
The company’s mining licence application is likely to be refused, with the Ministry of Mines and Energy notifying the company of this intention due to the current low uranium prices.
The granted environmental clearances remain valid and Bannerman retains the right to re-apply for a mining licence when the uranium market recovers.
Etango is one of the world’s largest undeveloped uranium deposits with environmental permitting set to be a top 10 producer.
Analysis
Phase 4 test work has confirmed the viability of the heap leaching process, which significantly de-risks the uranium project, both technically and financially.
Taken as a whole, the results of the demonstration program are exceptional: achieving 93% extraction from heap leaching is impressive, particularly in only 20 days.
Further, the ore is ideal from a low acid consumption perspective, reducing one of the largest variable costs in the processing flowsheet.
Finally, the solvent extraction trials in Phase 4 show that there are no impurities in the leach solution and the uranium in solution fully loads within 30 seconds.
The overall result is very positive as Bannerman can now definitively say the demonstration plant is a success.
In turn, this removes one of the key potential risks a financing party or lender would be concerned about; heap leaching is not used often in uranium, although proposed adoption of heap leaching at Olympic Dam validates its suitability.
This advances Bannerman’s unique position as owning one of the world’s largest undeveloped uranium projects that is development ready as soon as the uranium market shows signs of recovery.
Phase 5, currently in progress, which plans to further improve the process and reduce costs, has seen initial outcomes showing clear potential for adoption of coarser grind sizes and lower reagent usage.
The board has made a strong decision to continue advancing the project in this challenging uranium price climate, which demonstrates confidence in the project.
The outcome of this success is that Bannerman is primed to benefit when uranium prices turn.
During June, Namibia’s President held talks with Indian delegates reiterating their commitment to supplying India with uranium.
This could strengthen demand for Namibia’s uranium as India signed a treaty with Namibia in 2009 for the peaceful nuclear energy use but is yet to be implemented.
Given China and Russia also have ambitious nuclear programs, Bannerman’s Etango has sufficient scale and technical simplicity to be strategically important.
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