Boss Resources will bring the Honeymoon Uranium Mine back into production next year

After being mothballed for years, the Honeymoon Uranium Mine in outback SA will restart production as Boss Resources signs off on a $113m upgrade.

Nuclear energy is having something of a renaissance.

The Honeymoon Uranium Mine is expected to restart production late next year after owner Boss Resources signed off on a $113m upgrade plan to bring it back online.

The in-situ leach mine, in eastern South Australia near Broken Hill, was mothballed by former owner Uranium One in 2013 before being sold to Boss in 2015.

The company has been working on plans to bring the mine back into production, and on Wednesday said its bord had made a final investment decision to proceed with the project.

The mine is expected to start producing uranium in the December quarter next year, and will ramp up to a maximum rate of 2.45 million pounds per year within three years.

The project currently has a mine life of 11 years however Boss said in a statement to the Australian Securities Exchange that there was the potential to extend this by exploiting satellite deposits.

Boss said its managing director Duncan Craib made a presentation to state Mining and Energy Minister Tom Koutsantonis last week, after which the board signed off on the project.

“This final investment decision puts Boss firmly on track to be Australia’s next uranium producer,” Mr Craib said in the statement on Wednesday.

“We are fully-funded with no debt, fully-permitted and extensive infrastructure in place. Our front-end engineering studies are completed and we are ready to order key equipment and start construction immediately.

“This puts us in an extremely strong negotiating position with utilities and ensures we can capitalise on the looming uranium supply deficit.”

The mine is expected to produce uranium at an all-in sustaining cost of $US25.60 over the life of the mine, against the current uranium price of $US48.45.

The company will now accelerate construction at the site, and Mr Craib said it had already “made rapid progress on several key fronts to minimise the lead time between FID and first production’’.

An experienced project management team had been recruited, several long lead time items had been ordered and detailed engineering was under way.

Boss shares were 3.7 per cent lower at $2.34 in early trade.

Originally published as Boss Resources will bring the Honeymoon Uranium Mine back into production next year