Name of the Project
Lance uranium project.

Location
The Lance projects are located on the north-east flank of the Powder river basin, in Wyoming, in the US.

Project Owner/s
Peninsula Energy.

Project Description
A feasibility study on the projects has confirmed the economic viability of transitioning to a low-pH in situ recovery operation.

The Lance projects comprise the Ross, Kendrick and Barber production areas, which have a total mineral resource estimate of 48.9-million tonnes grading 473 parts per million of triuranium oxide.

Current alkaline in situ recovery operations at the project are authorised to mine only the Ross production area.

The study proposes a staged expansion of the current operational facility into a full central processing plant (CPP), which includes elution, precipitation and drying equipment at Ross, followed by the construction of a satellite plant at Barber. Kendrick will operate as an extension of Ross, with mining solutions pipelined to and from the Ross CPP.

The feasibility study envisages three stages of uranium production capacity.

Stage 1 will include the changeover of the current facility and wellfields to use low pH solutions at the existing flow capacity of 3 750 galons per minute (gpm) through the ion exchange (IX) circuit, which will result in a production capacity of about 1.15-million pounds of triuranium oxide a year at an average head grade of 70 parts per million (ppm).

Peninsula will continue to use toll milling services for elution, precipitation and drying. The existing toll milling agreement remains in place until December 30, 2018.

Stage 2 will include the expansion of the current facility, allowing for production flow of up to 7 500 gpm from the Ross and Kendrick areas, the addition of elution systems for the elution of uranium from the IX resins, the addition of precipitation and drying capacity, as well as reserved space for additional equipment in the next stage. Stage 2 changes will result in a production capacity of about 2.3-million pounds triuranium oxide a year at an average head grade of 70 ppm.

Stage 2 changes include the capability to produce dried yellowcake on site, eliminating the need for toll milling agreements. Although Ross and the CPP are currently fully permitted, Stage 2 will require permit approval for the operation of wellfields within Kendrick.

Stage 3 will include the construction of a 7 500 gpm satellite plant at Barber and the installation of expanded production capacity at the CPP.

Life-of-mine (LoM) production is estimated at 33.4-million pounds triuranium oxide over a 17-year LoM.

Potential Job Creation
Not stated.

Net Present Value/Internal Rate of Return
The project has a net present value, at an 8% discount rate, of $156.5 million (real), and an internal rate of return 30%.

Capital Expenditure
LoM capital expenditure (capex), including capex for the transition to low pH operations, ongoing wellfield development, stage 2 and 3 expansion and contingency, is estimated at $461.2-million. The capex, including contingency, to complete the transition to low pH operations is $5.3-million.

Stage 2 expansion capex is estimated at $43.1-million, including contingency, and includes costs to expand the process plant and increase wellfield flow-rate capacity from 3 750 gpm to 7 500 gpm.

Stage 3 expansion capex is estimated at $70.3-million, including contingency, and includes costs to build a satellite plant and start the initial development of wellfields in Barber with a flow-rate capacity of 7 500 gpm.

Planned Start/End Date
Not stated.

Latest Developments
Peninsula Energy will be ramping up predevelopment activities at its Lance project.

Over the next 12 to 18 months, Peninsula will focus on key site-specific technical, process development and optimisation activities to prepare Lance as the only commercial low-pH in situ operation in the US, after completing the laboratory phase of optimisation testwork.

“Developments in the uranium market over the recent past have been highlighted by limited global production and restraint of mid to long-term purchasing activities by end-users, which indicates a strong likelihood of increasing price and purchasing activity over the coming months and years,” MD and CEO Wayne Heili has said.

“Peninsula will use its strong balance sheet to sensibly progress Lance with the advantage of knowing that if markets warrant, we could make an investment decision in parallel with the optimisation workstream and be in commercial production within a six-month timeframe.”

Peninsula is in the midst of licence amendment applications for the use of oxidants with a low-pH in situ operation process and for the use of ponds for solids management in future operation. The company expects to have completed these licence amendments by the latter half of 2021.

Key Contracts and Suppliers
Woodard & Curran (feasibility study).

Contact Details for Project Information
Peninsula Energy, tel +61 8 9380 9920, fax +61 8 9381 5064 or emailinfo@pel.net.au.