Australia-based uranium miner Peninsula Energy is determined to wrap up the reserve drilling for the definitive feasibility study on its Karoo uranium projects, in the Western Cape of South Africa, which will pave the way for a mine to be built by 2019, says Peninsula Energy MD and CEO Gus Simpson.

The scoping study on the eastern section of the project area, located near Beaufort West, indicates that acid processing is the most efficient and cost-effective method to use and supports the decision to proceed to the prefeasibility study which is under way.

Simpson says the Karoo projects are ideally positioned to be the second low-cost, long-life mine in the Peninsula global portfolio. The product to be produced is known as triuranium octoxide (U3O8).

The company is planning on a steady-state production rate of three-million pounds to four-million pounds of U3O8 a year, while low-risk existing proven methods and processes will primarily be used for the mining and processing of uranium.

Based on the scoping study, the initial capital cost is about $150-million. Simpson points out, however, that several opportunities to reduce this cost have been identified and will be further developed during the feasibility study.

He asserts that a number of funding options will be available to Peninsula, including project finance debt, advanced product sales and equity. The funding mix will be finalised once the bankable feasibility study has been completed.

The uranium produced from the Karoo projects will be available for sale to the South African nuclear power generating industry and global customers; the latter primarily consists of utility companies in North America and Western Europe.

Simpson explains that, when used for nuclear power generation, uranium can produce large quantities of carbon-free baseload electricity 24/7, unlike some other sources of carbon-free electricity, such as wind and solar, whose supply depends on the weather. The energy conversion properties measured per kilogram of uranium also far outweigh those of the other major sources of baseload power, such as coal, gas and oil, he adds.

“The company believes that its Karoo projects offer an excellent opportunity for domestic uranium supply to fuel the new reactors that are being developed under the recently announced expansion of South Africa’s nuclear power generating capacity.”

There are currently nine people working from the site office, in Beaufort West, but during exploration, there were as many as 100 people employed on site.

During the construction phase, the creation of up to 1 000 jobs is expected, with about 250 permanent jobs to be created during the steady-state production phase of the mine.

“[Once in the development and construction phases], the company’s focus will be on advancing the construction and commissioning of the Karoo projects over the next two to three years,” concludes Simpson.