Boss Resources says it’s on track to produce uranium from Honeymoon by year’s end
The Honeymoon uranium mine near Broken Hill is set to restart production before the end of the year, its owner Boss Resources says.
The Honeymoon uranium mine near Broken Hill will restart production before the end of the year, after a decade-long break, its owner Boss Resources says.
Boss bought the project from former owner Uranium One in 2015, and has been working on bringing the in-situ leach mine back into production over the past few years.
The company told the ASX on Monday it had made strong progress “on all fronts” at Honeymoon, which is located in eastern South Australia, close to Broken Hill.
Boss said it was fully-funded through to production, had cash on hand of $103m, and a strategic uranium stockpile worth $96m based on current spot prices. The company has no long-term debt.
Managing director Duncan Craib said “all aspects’’ of the construction of the $105m mine were proceeding according to plan, including delivery of critical equipment, well field development and the evaporation pond.
“Committed expenditure now totals $65 million, representing 62 per cent of the total capital cost budget, meaning we are currently scheduled to be on track for first production as planned in the December quarter of this year,’’ Mr Craib said.
“This timetable was designed to ensure we are in production at the start of the next forecast uranium bull market, not halfway through it.
“With the outlook for the uranium price continuing to strengthen amid growing use of nuclear power and a shift away from Russian uranium, we are perfectly positioned as we prepare to move into the final stages of construction ahead of commissioning”.
Boos said it had recruited all of the senior staff required, except those relating to the processing plant which were yet to be advertised. The company now employs 62 people.
“Construction of the three start-up well fields is now ahead of schedule,’’ the company said.
“All significant procurement items have been delivered and installed, with cold commissioning on target for June 2023.’’
Honeymoon is expected to produce uranium at an all-in sustaining cost $US25.60 per pound, against the current spot price of $US51.
The project is expected to ramp up to 2.45 million pounds per year within three years, and is expected to produce 21.8 million pounds of uranium over 11 years.
About half of the currently identified resource is also not factored into the current mine plan, Boss says.
In its most recent quarterly, the company said the fundamentals of the uranium market were the strongest they had been since the early 2000s.
“Nuclear power is being recognised as a clean energy source that is needed to meet future global climate change targets,’’ the company said.
“Uranium demand in the near term is growing as existing reactor lifetimes are being extended and reactors under threat of shutdown for economic reasons are reprieved.
“Mid to long term demand continues to increase as new reactor programs are announced.’’
The Honeymoon deposit, 75km north west of Broken Hill, was discovered in the early 1970s with the first in-situ leach trials conducted in 1977 and 1979.
Uranium One operated the mine from 2011-13 before placing it in care and maintenance, before it was sold to Boss Resources in 2015.
Boss shares were steady on $2.26 on Monday.
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