Seeking Alpha

Proactive Investor's  Instablog

Proactive Investor
Send Message
Proactiveinvestors is a leading multimedia news organization, investor portal and events management business with offices in New York, Sydney, Toronto and London. Proactiveinvestors operates five financial websites in four languages providing breaking news, comment and analysis on hundreds of... More
My company:
Proactiveinvestors
My blog:
Proactiveinvestors
  • Peninsula Energy Scoping Study To Power Up Uranium Projects In South Africa 0 comments
    Sep 19, 2013 1:30 AM

    Peninsula Energy (ASX: PEN) has completed a Scoping Study on the Karoo Eastern Sector Projects in South Africa that has identified the preferred development path and uranium resource expansion potential.

    Importantly, it supports the decision to proceed to a Pre-Feasibility Study, which is anticipated to commence in October 2013.

    In addition, the preliminary financial model generated for the study indicated that sufficient positive cashflow could be generated over the proposed project life.

    "We are very pleased with the positive results of the Scoping Study which support the belief that the Karoo Projects have the potential to become a second production centre for Peninsula," executive chairman Gus Simpson said.

    The Karoo Western Sector Projects areas were not included in the study, offering further upside potential.

    Forward Plans

    South African engineering, procurement and construction consultants DRA Mineral Projects will now commence with a Mine Works Plan (MWP) using the final outcomes from the scoping study and linking them to the geology and an interactive production schedule to optimise the production ramp up from open pit and underground areas.

    Completion of the MWP will allow the submission of the mining license application to the Department of Mineral Resources by the end of the calendar year.

    The company will seek to introduce radiometric sorting technology into the metallurgical process flow, which could potentially reduce capital and operating cost savings.

    Historical radiometric sorting test work by Esso through Hazen Research Incorporated and the Atomic Energy Board had indicated that approximately 60% rejection of "ore material" could be achieved whilst retaining 98% uranium recovery.

    Subsequent test work conducted by Australian Nuclear Science and Technical Organisation (ANSTO) indicated that about 40-55% rejection of "ore material" could be achieved while still retaining 99% uranium recovery efficiency.

    Investigations and test work using the latest radiometric "ore material" sorting technology will be carried out with the aim of minimising low grade ore feed to the process plant.

    DRA will also provide detailed input into Peninsula's future drilling efforts aimed at converting Inferred resource to Indicated status. This will then allow the inclusion of this resource into the PFS.

    Further acid and alkaline test work to optimise leaching efficiency will be conducted at ANSTO to determine overall process recoveries and process operating costs.

    Scoping Study

    The Scoping Study had included reviews of all previous technical reports and metallurgical test-work; an interrogation of the JORC resource model and databases; as well as a series of optimisation analyses (both open pit and underground) on the Eastern Sector resources.

    The review of the metallurgical test-work included the development of four process flow options from the acid and alkaline leach results:

    - Acid leaching with molybdenum recovery;
    - Acid leaching without molybdenum recovery;
    - Alkaline leaching with molybdenum recovery; and
    - Alkaline leaching without molybdenum recovery.

    This established that the fourth option was the optimum process design and resulted in the lowest production cost per U3O8 pound.

    Besides supporting the start of the PFS, the Scoping Study also demonstrated that significant potential for extending both the open pit and underground mineral resource exists within the seven mineralised zones considered along with further potential in other mineralised zones within the RystKuil channel that were not included in the study.

    Karoo Projects

    The company had in February 2013, logged a JORC resource of 50.1 million pounds of eU3O8 at the Karoo Projects including an Indicated Resource of 15.7 million pounds grading 1,020ppm eU3O8.

    This was based on a database comprising 7,163 drill holes, together with 1,245 additional holes probed or drilled by Peninsula since 2011, including 16 diamond holes and 730 reverse circulation holes.

    Since then, it has embarked on a program of converting resources from inferred to indicated status and to delineate mineralisation that falls in the Exploration Target of between 250 million and 300 million pounds of U3O8.

    The initial drilling program in this campaign commenced at the De Pannen resource area, located within the Eastern Sector of the Karoo Projects.

    In addition to the above, the company is continuing the down-hole gamma logging program to validate historic results at the project.

    The current Karoo resources are located on two well-defined sedimentary channels that each extends for up 100 kilometres along strike. These channels have been tested both recently and historically with approximately 10,000 exploration drillholes.

    Along these channels JORC-compliant resources have been estimated in localised areas in which reliable drilling data is available. The zones between the JORC-compliant resources areas form the Exploration Target.

    Over the next 3-5 years ongoing exploration drilling is proposed to seek to expand the JORC-compliant resource within the Exploration Target areas.

    This initial 3-5 years program will be focussed on the Eastern Sector RystKuil channel. Testing of the Western Sector Exploration Target areas will commence beyond this time-frame.

    Peninsula has a 74% interest in a total of 42 prospecting rights covering 7,800 square kilometres of the main uranium-molybdenum bearing sandstone channels in the Karoo Basin.

    Peninsula is nearing completion of the acquisition of these prospecting rights with the remaining 26% remaining with Black Economic Empowerment partners as required by South African laws.

    In the Eastern Sector, Peninsula has freehold ownership over an area of 322 square kilometres, which covers a significant proportion of the reported resource and allows unlimited surface access.

    Additional surface access rights have also been contracted on a further 153 square kilometres until 2021. This area is largely contiguous with the freehold land.

    Analysis

    The Scoping Study has confirmed that the Karoo Basin represents a second uranium production centre for Peninsula Energy that contains substantial upside potential.

    Notably, it has also provided the company with the confidence to proceed with a Pre-Feasibility Study.

    Proactive Investors Australia is the market leader in producing news, articles and research reports on ASX "Small and Mid-cap" stocks with distribution in Australia, UK, North America and Hong Kong / China.

Back To Proactive Investor's Instablog HomePage »

Instablogs are blogs which are instantly set up and networked within the Seeking Alpha community. Instablog posts are not selected, edited or screened by Seeking Alpha editors, in contrast to contributors' articles.

Comments (0)
Track new comments
Be the first to comment
Full index of posts »
Latest Followers

StockTalks

More »

Latest Comments


Posts by Themes
Instablogs are Seeking Alpha's free blogging platform customized for finance, with instant set up and exposure to millions of readers interested in the financial markets. Publish your own instablog in minutes.