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Toro Energy Starts 370 Hole Infill Drilling Program At Wiluna Uranium Project

Toro Energy (ASX: TOE) has commenced its 2013 infill drilling program of 370 holes totalling 7,000 metres at its wholly owned Wiluna Uranium Project in Western Australia.

This is designed to further advance the towards mine development decision beginning at the Centipede and Lake Way deposits, which have already received the necessary environmental approvals.

It also represents the largest single drilling program the company has undertaken at Wiluna.

"With the recent completion of government environmental approvals for mining at Centipede and Lake Way, Toro is continuing to advance the project and position it a step closer to being Western Australia's first uranium mine," managing director Vanessa Guthrie said.

The campaign of sonic core and air core drilling will focus on the Lake Way, Millipede and Dawson Hinkler deposits at Wiluna.

Wiluna Uranium Project

Toro had at the beginning of April received the key Federal environmental approval for the Wiluna Project, giving it the certainty to fully underpin its negotiating capacity and advance commercial financing arrangements and product off-take agreements with potential partners.

The mine comprises two initial deposits - Centipede and Lake Way - processing 1.3 million tonnes per annum to produce about 780 tonnes of uranium oxide concentrate based on up to 14 years of mine life.

Toro has completed the first phase of the Wiluna Definitive Feasibility Study and has finalised the processing design, major equipment lists and plant layout.

Significant testwork, including a full scale hydrometallurgical pilot plant, resource evaluation and water barrier trials carried out over the last two years, have proven that a conventional alkaline tank leach process is the most effective economic recovery available.

The second phase of the DFS - consisting of engineering, infrastructure design and final cost estimates - is planned for completion this year.

Toro's economic modelling for the Wiluna mine based on the process engineering from the DFS, pilot plant testwork and revised mine plan, indicates a reduced capital cost estimate of A$207 million in direct costs, $31 million in EPCM and $31 million in contingency for a total of A$269 million.

C1 cash operating costs are currently estimated at US$37 per pound of U3O8.

Wiluna has a current Measured, Indicated and Inferred Resource of 54 million pounds of U3O8 in five calcrete deposits with significant upside in currently held but under-developed exploration tenements located throughout WA's northern goldfields.

The largest of these deposits, Centipede and Lake Way, currently form the basis of the Wiluna resource that will be mined in a shallow surface strip mining operation.

Toro had $10.1 million in cash as of 31 March 2013.

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