GoviEx Uranium (TSXV: GXU; US-OTC: GVXXF) shares rose 17.6% Wednesday after it announced that metallurgical test work for the Muntanga project in Zambia has returned positive results, while the company advances the project towards the feasibility stage.
The results showed a significant increase in uranium recovery rates compared to those outlined in the 2023 technical report. In particular, the main deposits, Muntanga and Dibbwi East, which account for 80% of the measured and indicated resources, achieved recoveries of 90% or higher.
“With high uranium recoveries of 90% or better for the Muntanga and Dibbwi East deposits and overall low acid consumption, the data provides further confidence in the project’s processing design, helping to refine key assumptions and parameters for the upcoming feasibility study,” GoviEx CEO Daniel Major said in a release.
The Muntanga project has become GoviEx’s main focus after mining permits for its Madaouela project in Niger were revoked in July. The Muntanga property encompasses three mining licences plus three exploration licences with a total combined area of 1,226 sq. km.
GoviEx shares traded for 10¢ apiece on Wednesday, valuing the company at $81.4 million. Its shares have traded in a 52-week range of 4¢ to 22¢, after it reached a new low in August following the company’s setback in Niger.
Confidence for feasibility
The new results at Muntanga help demonstrate the efficiency of its heap leach process and validate the work completed by the previous project owners, GoviEx said. They also raised the level of confidence in the company’s feasibility study, which it expects to complete before year-end.
The tests were carried out at Mintek, South Africa, involving six-metre sulphuric acid column leaching for each of the six mineralization zones across the Muntanga project, based on new material derived from the 2023 diamond drilling program. The test work was more extensive than previous work, which was predominantly limited to two-metre leach columns.
The discovery of the Dibbwi East deposit occurred after the previous column test work was completed in 2013, GoviEx noted. Drilling conducted between 2021 and 2023 increased the total resource of the Dibbwi East deposit by 60% in contained tonnes. This not only expanded the deposit but also extended it into primary mineralization, in addition to the secondary (oxidized) mineralization that had been the focus of earlier test work.
Focus on Zambia
Two of the mining licences comprising the Muntanga, Dibbwi and Dibbwi East deposits were acquired from Denison Mines (TSX: DML; NYSE: DNN) in 2016, while the mining licence covering the Njame (north and south) and Gwabi were acquired from AFR a year later.
Across the five deposits, located over a 65 km strike length, there is an estimated 42.6 million measured and indicated tonnes grading 359 parts per million (ppm) uranium oxide (U3O8), containing 33.7 million lb. of U3O8, and 15 million inferred tonnes at 330 ppm U3O8, containing 10.9 million lb. of U3O8.
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