TSX-V and Nasdaq-listed uranium developer Anfield Energy has filed an updated combined preliminary economic assessment (PEA) for its planned US operations.
The PEA incorporates the Utah-based Velvet-Wood uranium and vanadium project, the Colorado-based Slick Rock uranium and vanadium project and six of the nine mines that comprise the West Slope complex. Together, these eight projects are located within the prolific Uravan Mineral Belt and are within close distance of the company’s Shootaring Canyon Mill, which will act as a centralised processing facility.
The updated PEA indicates an after-tax net present value of $533-million and an internal rate of return of 97%, at a uranium price of $100/lb and a vanadium price of $9/lb. The PEA expects a payback period of 1.3 years based on these prices.
The combined operations will produce about 1.3-million pounds of uranium and 6.4-million pounds of vanadium every year over a 15-year mine life.
The PEA defines a $80-million capital requirement at the Shootaring mill to meet the increased tonnage capacity of 1 000 t a day, including $31-million for general upgrades, $34-million for a modern vanadium circuit and $14-million to update the tailings management system.
The estimated mine-related capital expenditures, including for engineering and design, mine facilities, mine equipment, reopening of declines and sinking of production shafts, is $37.5-million. This cost will, however, be partially offset by expected cash flow of $23.2-million related to initial uranium production from Anfield’s stockpiled material.
For Anfield CEO Corey Dias, the updated PEA provides the company with strong evidence of the true value of combining the Velvet-Wood, Slick Rock and West Slope mines within Anfield’s uranium and vanadium hub-and-spoke production model.
Importantly, he adds, the future potential addition of Anfield’s 13 remaining US Department of Energy leases to Anfield’s production model pipeline provides significant valuation upside. Given that Shootaring’s restart costs will have already been borne by initial production from the Velvet-Wood, Slick Rock and West Slope mines, the addition of more miens will require little incremental capital expenditure.
In this regard, the prospect of Anfield’s largest single uranium mine – Marquez-Juan Tafoya, as an additional source of uranium, could further extend the production timeline or provide an incentive to once again expand throughput capacity at the Shootaring plant.
“The prospect of Shootaring becoming the second of only two operational conventional uranium and vanadium mills in the US is significant both economically and with respect to security of supply for utilities,” Dias states.
He adds that this PEA not only represents a significant milestone for Anfield but also outlines a technical and economic path towards commercial development of its core uranium and vanadium assets.
Dias concludes that the company is currently reviewing a number of other value-added techniques and technologies to facilitate the reduction of waste in order to improve uranium and vanadium grades, which can provide the company with an opportunity to further improve yearly production output.