Berkeley Energia Limited (LON:BKY, ASX:BKY) said it is in a strong cash position to push forward with its flagship Salamanca project and expand exploration activities in the first quarter of the year.
The AIM-listed uranium miner said it currently holds US$100mln in cash, while also currently holding 2.75mln pounds of triuranium octoxide (U3O8) concentrate under long term contracts over the first six years of production, with potential to increase annual contracted volumes further as well as extend the contracts by a total of 1.25mln pounds.
Across the portfolio, the company said the average fixed price per pound of contracted and optional volumes is above US$42 per pound, comparing favourably with the current spot price of around US$21 per pound.
Berkeley added that its soil sampling programme had continued throughout the quarter, with the focus on identifying targets with similar characteristics to its Zona 7 and Retortillo deposits.
The company said during this second phase, following on from the December 2017 work programme, a further 1,600 soil samples were collected across the Salamanca I and Salamanca II areas and were being analysed using Ionic Leach, which allows for very high levels of detection of uranium and other economic minerals.
To date, the group said it has also received more than 120 favourable reports and permits for the development of the mine, with the next major approvals being the Urbanism Licence by the municipal authority and the Construction Authorization by the Ministry of Energy, Tourism and Digital Agenda for the treatment plant as a radioactive facility.
At the end of the quarter, the company held cash and cash equivalents of around A$99.8mln, compared to A$105.3mln in the previous quarter.
The company also saw financial progress in March, when is secured a US$120mln deal with the Oman sovereign wealth fund to help development of the project.
Paul Atherley, managing director of Berkeley Energia, said: "Having completed the financing, we are finalising the selection of contractors and are undertaking detailed final reviews to ensure that we have the most optimal capital and operating costs.
He added: “There is a huge amount of support for the Salamanca mine, which is located in a region experiencing some of the highest levels of unemployment in the European Union.”
In a note to clients, analysts at Shore Capital said that unless costs rise dramatically, they expected the Salamanca mine's capital costs to be fully funded to production.
In early trading Monday, Berkeley Energia shares were steady at 45p.
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