Anaconda Uranium Corp -
JV in Portugal with Empresa Nacional Uranio S.A.
Anaconda Uranium Corp
ANU
Shares issued 11,117,500
1998-07-15 close $0.12
Thursday Jul 23 1998
Mr. John Cook reports
Anaconda Uranium has entered into a binding agreement with Empresa Nacional
Uranio S.A., a subsidiary company of the Portuguese State mining holding
company, EDM, S.A., to develop and exploit the Nisa uranium project as a joint
venture. Anaconda has a three month period to complete further due diligence.
Anaconda will provide the capital, of up to 1,000 million Escudos, equivalent to
approximately $8-million, to bring the project into production. This will enable
Anaconda to earn a 75 per cent interest in the project.
In the Alto Alentejo area of Portugal, the Nisa project consists of eight shallow
uranium deposits with total reserves in excess of 5 million pounds of U(3)O(8) at
a grade of 0.13 per cent U(3)O(8). Additional deposits in the area provide the
potential to significantly increase the resources.
Portugal has been a producer of uranium for many years and at Urgeirica, ENU
has a fully permitted and operational ion exchange plant for yellowcake
production. The total capacity of this plant, about 190 kilometres from Nisa, is
approximately 380,000 pounds of U(3)O(8) per year. As part of the agreement,
this plant will be made available by ENU, on a priority basis, to treat material from
the Nisa project.
The Nisa uranium deposits, first discovered in 1957, have been extensively
explored and studied but, apart from bulk tests, have never been exploited. Most
of the geological work was completed more than 20 years ago however the
resources and reserves are now fully computerised. Feasibility studies were
completed by ENU in 1986 and 1988 based on a standard milling operation and
a heap leaching scenario respectively. The 1988 study was reviewed positively by
Kilborn Engineering (B.C.) Ltd.
More recently, ENU completed a detailed feasibility study in November 1997
which envisaged mining and heap leaching at the Nisa mine site, the transportation
of loaded resin to Urgeirica and the production of yellowcake product. This study
proposed an average production of 250,000 pounds of U(3)O(8) per year.
Anaconda has examined this study and agrees with its conclusions. It is planned
that the Nisa project will start in this way and then expand up to 380,000 pounds
of U(3)O(8) - the limit of the Urgeirica plant. Because of the high standard of the
ENU feasibility study it should be possible to finance a significant portion of the
project with a project loan.
Permitting for the Nisa project mine and heap leach has been started and should
be completed within the next six months. Once these permits have been awarded,
mine construction should be completed within six months. Thus it is estimated that
the project will be in production within the next 12 months.
The primary market for the Nisa project will be to other countries in the European
community for which total annual reactor requirements are more than 50 million
pounds of U(3)O(8). The yellowcake product will be able to be sold via
long-term contracts which are significantly higher than the current spot price.
The development of this project will allow Portugal to remain a European uranium
producer. For Anaconda, the advanced state of the engineering and permitting of
the project will allow a production status to be achieved relatively quickly.
(c) Copyright 1998 Canjex Publishing Ltd. canada-stockwatch.com |
