Fission Uranium (TSX: FCU) has tabled a prefeasibility study (PFS) for its Patterson Lake South uranium project in Saskatchewan’s Athabasca region, outlining an open pit and underground hybrid operation. It’s working on a preliminary economic assessment (PEA)-level underground only scenario that it says could offer improved economics.
The PFS assigns the project a $693 million after tax net present value at an 8% discount rate and a 21% after-tax internal rate of return.
According to the study, the project would produce 87.5 million lb. uranium oxide over an eight year mine life. At US$50 per lb. uranium prices, it would generate more than $5.4 billion in net revenue at $9.03 per lb. uranium oxide average operating costs. It would require $1.5 billion in initial capital.
The study also included a maiden reserve estimate for the project.
Patterson Lake South now contains 2.8 million probable tonnes grading 1.42% uranium oxide for 90.5 million lb. uranium oxide.
The PFS scenario would take four years to build and involve a dyke and slurry cut-off wall to create an open pit in the middle of Patterson Lake.
The PEA scenario would take three years to build and eliminates the need for a dyke and slurry cut off wall, but sacrifices some indicated resources to a crown pillar. The PEA case has a $696 million after tax NPV at an 8% discount rate and a 26% after-tax IRR.
Under that model, the project would produce 81.4 million lb. uranium oxide over a 7 year mine life at $9.57 per lb. uranium oxide operating costs. It would require $1.2 billion in initial capital.
The company intends to progress the underground only scenario to the PFS level.
(This article first appeared in The Northern Miner)
The post Fission Uranium tables PFS for Patterson Lake South appeared first on MINING.com.