Vancouver – After more than 285,000 metres of drilling in 1,031 holes Bannerman Resources (BAN-T, BMN-A) has established a significant measured and indicated uranium resource at its 80%-owned Etango project in Namibia.
The latest resource estimate, which is the seventh so far, has 289 million measured and indicated tonnes grading 0.0223% U3O8, using a 0.01% cutoff. The resource has a further 42 million inferred tonnes grading 0.0216% U3O8.
With the latest round of drilling the company increased the total resource by 7% from the last estimate and shifted 38% of the resource into the measured and indicated category, which now accounts for 88% of the total.
Bannerman has been exploring the southern African country since 2006 and has now established a 6-km long contiguous resource at the Etango project. The company has spent roughly A$60 million so far in Namibia.
Bannerman completed a pre-feasibility study late last year that contemplated an open-pit operation processing ore through agitated tank leaching of a high-grade flotation concentrate. Using a US$70-per-lb. uranium oxide price, the study found an Etango mine could generate a 22% pre-tax internal rate of return and the payback period for the US$555 million capital costs would be 3 to 4 years.
The study found Etango could produce 5 to 7 million lbs. U3O8 annually over a 16-year mine life, starting sometime in late 2013. The study further estimated a production cost of US$38 per lb. U3O8 for the first 5 years, with an average of US$41 per lb. for the life of mine. The company estimates it could achieve recovery rates of over 90% using flotation concentrate.
In the pre-feasibility study the company also considered using heap leaching but found it produced lower recovery rates and required greater capital investment.
The company plans to release another resource estimate in September that will complement a feasibility study currently being prepared. The pre-feasibility study did not contain an ore reserve as the company decided that at the time too much of the resource was in the inferred category.
The uranium at Etango is contained in alaskite granites with minor mineralization also found in the metasedimentary sequences close to the alaskite contacts. The alaskites consist mainly of quartz and feldspar with a spattering of other minerals.
Uraninite is the dominant mineral and occurs as disseminations within rock fractures, at crystal interfaces, and as inclusion within other minerals.
The Etango project is located 31 km east of the coastal town of Swakopmund and 47 km away from the deepwater port of Walvis Bay.
Rather than concentrate simply on further infill drilling in 2010, the company plans to explore its Etango, Swakop River and Botswana properties with the aim of discovering further uranium mineralization.
Bannerman’s stock price was up 5¢ on the news to close at 50¢. The company has a 52-week share price range of between 42¢ and $1.32 and 206 million shares outstanding.
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