Name of the Project
Arrow uranium project.

Location
The project is located in the Athabasca basin in Saskatchewan, Canada.

Client
NexGen Energy.

Project Description
A prefeasibility study (PFS) on the Arrow project has delivered a substantial improvement on the July 2017 preliminary economic assessment (PEA).

Indicated mineral resources have increased 43% from 179.5-million pounds of uranium (U₃O₈) contained in 1.18-million tonnes grading 6.88% U₃O₈ in the March 2017 PEA mineral resource estimate, to 256.6-million pounds of U₃O₈ contained in 2.89-million tonnes grading 4.03% U₃O₈ in the PFS.

The PFS mine plan, using a 0.25% U₃O₈ cutoff grade, includes probable mineral reserves comprising 234.1-million pounds of U₃O₈ contained in 3.43-million tonnes grading 3.09% U₃O₈, which will be extracted by underground mining over an initial nine-year mine life, rather than the previously estimated 15 years.

Average production has increased from 18.5-million pounds a year of U₃O8 in the PEA to 25.4-million pounds a year of U₃O₈ in the PFS, owing to higher head grades increasing from 1.73% U₃O₈ in the PEA to 3.09 % U₃O₈ in the PFS. The underground mining rate is expected to drop from 1 448 t/d to 1 039 t/d.

The underground workings will be accessed by two shafts, the first supporting personnel movements, materials, ore, waste and fresh air. The production shaft will have divided compartments, ensuring that fresh air, and personnel entering the mine, remain isolated from ore being skipped to surface.The second shaft will be used for exhaust air and secondary egress.

The PFS has confirmed that conventional processing technology will be used to process and produce yellowcake from the Arrow deposit. The main components of the processing plant include grinding, leaching, liquid-solid separation through counter current decantation, solvent extraction, yellowcake precipitation, yellowcake packaging and paste tailings plant.

A metallurgical pilot plant and bench-scale testing have optimised recovery resulting in an increased total processing recovery rate to 97.6% versus 96% in the PEA.

In addition, the ammonia strip process envisioned in the PEA has been updated to an acid strip process in the PFS, resulting in the complete elimination of ammonia in the processing facility. Elimination of ammonia from the processing facility will ultimately lead to improved effluent discharge performance.

The PFS has also confirmed that all processed waste streams can be stored in an underground tailings management facility (UGTMF). The UGTMF will significantly reduce the surface footprint of the project and represents continued and ongoing reclamation during operations, allowing for industry leading environmental sensitivity.

Potential Job Creation
Not stated.

Net Present Value/Internal Rate of Return
The PFS estimates an after-tax net present value, at an 8% discount rate, of C$3.7-billion, compared with C$3.49-billion in the July 2017 PEA.

The internal rate of return has increased from 56.7% in the PEA to 56.8% in the PFS. The payback has also increased marginally from 1.1 years to 1.2 years.

Value
Initial capital costs have increased from C$1.19-billion in the July 2017 PEA to C$1.25-billion in the PFS. Capital expenditure has increased owing to the introduction of provincial sales tax applicable to capital projects.

Duration
Not stated.

Latest Developments
NexGen is expediting Arrow to feasibility by initiating a two-stage 125 000 m (1ten rig) high-density drilling programme.

Preparations are well under way with the programme brought forward and scheduled to start in early December 2018.

Key Contracts and Suppliers
Wood Group, and Roscoe Postle Associates (PFS) and Arcadis (modelling and assessment of radiological effects of underground uranium mining).

On Budget and on Time?
Not stated.

Contact Details for Project Information
NexGen Energy, tel +160 4428 4112 or email tmcpherson@nxe-energy.ca.