Emerging uranium producer Toro Energy's (ASX: TOE) plans for mining uranium in Western Australia have been given a major boost, with the state's Environmental Protection Authority (EPA) recommending approval for the company's Wiluna Project.
Wiluna is the first uranium project in Western Australia to receive this recommendation since a change of policy in 2008 allowed uranium mining in the state.
In its recommendation, the EPA said the project meets all environmental approval requirements and should be approved and allowed to proceed, subject to stated conditions within the report.
Greg Hall, managing director of Toro, said of the announcement: "This is an important day for Toro and for the Australian uranium industry."
"The Wiluna project is one of the few in the world capable of commencing near-term production in the crucial 2014/15 period when the international nuclear industry will be seeking additional secure long-term supplies.
"Toro is confident that its extensive technical and environmental study work and the rigorous assessment undertaken by the EPA will ensure a safe and sustainable mining operation at Wiluna."
The decision by the EPA will remain open to appeal for a two week period. Western Australian Environment Minister Bill Marmion will make his decision on the project following a review of any appeals that are raised.
A decision on the Wiluna Project under the Environment Protection and Biodiversity Conservation Act is also pending from the Federal Government. This is expected after the Western Australian process is finalised.
Cashed up for 2013 production
Toro Energy closed the March quarter with cash reserves of $16.1 million, enough to take the Wiluna project all the way to production in 2013.
The company is on track to achieve first production from Wiluna by the end of 2013, with first uranium cells by 2014.
Earlier this year Toro announced an upgrade in the JORC Resource at the Centipede deposit, which is Toro's first target for mining at Wiluna.
Centipede now hosts a resource of 12.9 million tonnes at 504 parts per million (ppm) uranium at a cut-off grade of 200ppm for 14.4 million pounds of contained uranium.
Importantly, this resource could be enough to allow Toro to mine Centipede as a stand-alone operation.
The upgrade at Centipede lifted the total Wiluna regional Resource base to 53.6 million pounds of uranium, based on 55.1 million tonnes at 440ppm with a 200ppm cut-off.
Toro will consider a final investment decision on the Wiluna Project upon receiving all government approvals.
Theseus project progress
In addition to Wiluna, Toro is making progress at the Theseus Uranium Project, also in Western Australia, where the company is aiming to establish a JORC Resource in 2012.
Recent drilling results from Theseus have provided encouragement for the project, with peak results of more than 0.6% pU3O8, with consistent widths and grades using a 200 parts per million (ppm) pU3O8 cut off.
Results from the drilling program so far have confirmed Toro's geological model for the southern area of the Theseus Project.
Theseus has an exploration target range of between 20 million tonnes and 40 million tonnes at 400ppm to 500ppm uranium for 22 million to 44 million pounds of uranium.
Initial uranium extraction tests at Theseus achieved extractions of 95.5% and 96.4% with ery low acid consumption, comparable to the preliminary recoveries from other Australian in-situ recovery type deposits.
Given the high quality and speed of uranium extraction, it is likely that the mineralisation at Theseus consists primarily of uraninite and coffinite, which is easily extractable.
Toro has advanced the approvals process at its flagship 54 million pound Wiluna uranium project (total regional resource) in Central Western Australia with an anticipated date of mid-2012, construction through 2013 and first uranium sales in 2014.
Timing wise, Wiluna's development timeline could suit European and US utilities which are known to be eyeing long-term uranium supply contracts - post Fukushima. Toro could be the first post-ban uranium miner in Western Australia to market and next uranium mine in Australia to production. Toro could also be one of the few uranium producers in the world capable of production in the critical 2014-15 period.
Taken together, and on an EV/uranium resource peer basis this provides a solid long term case for Toro Energy.
Proactive Investors is a market leader in the investment news space, providing ASX "Small and Mid-cap" company news, research reports, StockTube videos and One2One Investor Forums.