Bannerman Resources (ASX:BMN) has entered into an agreement with the One Economy Foundation to become a 5% loan-carried shareholder in the Etango uranium project in Namibia.
This Namibian ownership cements a key pillar of Bannerman’s corporate social responsibility in Namibia.
The One Economy Foundation is a Namibian not-for-profit organisation that concerns itself with the dual economy in Namibia.
Brandon Munro, CEO, commented: “We are delighted to welcome the One Economy Foundation as long-term equity partners in the Etango Project.
“The One Economy Foundation’s mission and approach is closely aligned with Bannerman’s outstanding record as a leader in corporate social responsibility.”
Subscription agreement details
As part of the subscription agreement, Bannerman will issue 5% of its ordinary share capital to the One Economy Foundation for par (nominal) value.
The One Economy Foundation will be loan carried for all future project expenditure including pre-construction and development expenditure, with the loan capital and accrued interest repayable from future dividends.
The agreement is subject to typical conditions precedent including due diligence and formal documentation.
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) completed in 2012 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.
Feasibility study update
Bannerman most recently commenced a definitive feasibility study update at Etango.
The study update commencement follows the successful completion of the Etango heap leach demonstration plant program.
The six phase demonstration plant program showed the strong potential to achieve and exceed the standing definitive feasibility study metallurgical parameters.
This will occur in parallel with assessment of other potential operating and capital cost reduction opportunities.