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Berkeley Energia awaiting final approvals to kick off construction of Salamanca uranium mine

Snapshot

The large scale uranium project has the potential to support a long life mining operation, with near surface, high-grade deposits for very low operating costs

Uranium

Quick facts: Berkeley Energia Ltd

Price: 16.30001 GBX

LSE:BKY
Market: LSE
Market Cap: £42.13 m
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  • Looking to develop world-class uranium project in Spain

  • Salamanca Project has near surface, high-grade deposits

  • Strong financial position with A$100mln in cash on balance sheet at end-December

 

What Berkeley Energia does:

Berkeley Energia Limited (LON:BKY) (ASX:BKY) is developing a world-class uranium project in a historic mining area in western Spain, about three hours west of Madrid.

Following recent Spanish ministerial approval, the company has now received all the European Union and national level approvals required for the initial development of the Salamanca project and is awaiting local licences.

The large scale uranium area has the potential to support a long life mining operation, with near surface, high-grade deposits for very low operating costs.

The group has said the project will generate measurable social and environmental benefits in the from jobs and skills training in a depressed rural community.

It believes the project will also make a significant contribution to the security of supply of Europe’s zero-carbon energy needs.

How’s it doing:

On 11 March 2019, Berkeley Energia said it has received a number of favourable assessments from various regulatory bodies in regard to permitting at its Salamanca uranium mine, including two assessments from the Nuclear Safety Council.

Berkeley is now awaiting the recommendation report from the Nuclear Safety Council to the relevant minister.

As previously announced, Berkeley also confirmed that it has been informed that the local municipality remains unable to award the Urbanism Licence due to a number of outstanding items which currently being addressed by the company.

In October 2018, Berkeley had said that the timing of the award of the Urbanism Licence was “uncertain” and it, therefore, had commenced a cost-reduction programme.

The company has said it has strong support from key stakeholders after more than 200 of Salamanca's business community came together in support for the €250mln investment involved in the area.

The firm has received the backing of the local community, with a recent petition supporting its project signed by nearly 1,500 residents in towns surrounding the site.

The company has also recorded over 22,500 job applications for the project, with 400 of those coming from nearby villages and of those, over 110 from the local village of Villavieja, representing 25% of its population.

It probably helps that Berkeley Energia is now also listed in Spain, the only mining company on the bourse there, as well as on the main board of the London Stock Exchange.

The group remains in a relatively strong financial position with A$100mln in cash on the balance sheet as at the end of the six months to 31 December 2018.

In a January 2019 update, Berkeley had highlighted that the fundamentals for uranium mining remain “very strong”.

In the quarterly report, Berkeley noted that spot uranium price continued to strengthen during the quarter, rising 4% to US$28.5 per pound by the end of the three months.

It said: “The fundamentals for uranium remain very strong with continued supply disruption being met by a re-contracting cycle for US and EU utilities; and continued increases in global nuclear capacity.”

The group has around 2.75mln pounds of uranium (U3O8) under contract for the first six years of operation, with another 1.25mln pounds of optional volume, at an average price of US$42 per pound.

Berkeley also revealed in January that soil sampling close to the Salamanca mine site has identified other elements as well as uranium including gold, lithium, cobalt, tin and rare earths.

It said it has applied for twelve new investigation permits, covering 350 square kilometres.

What the boss says – managing director, Paul Atherley

“Our potential €250mln investment will rejuvenate a local community which is suffering from long-term depopulation and some of the highest levels of youth unemployment within the EU.

“But our investment also goes beyond just employment - it will boost local businesses, improve schools that haven't been refurbished for decades and see other key services such as petrol stations return to the area."

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Watch

Caution over Berkeley Energia report casting doubt over Spanish government...

Numis Securities analyst Justin Chan chats to Proactive London's Andrew Scott following a Reuters report suggesting Spain’s government will not issue the required permits for construction of Berkeley Energia Ltd 's (LON:BKY) Salamanca mine to go-ahead, even though the project was granted...

on 17/10/18

4 min read