Paladin Energy Limited (ASX:PDN) has confirmed it has been decided to return the Langer Heinrich Uranium Mine, located in Namibia, to production.
“With the strength of the company’s uranium offtakes and the continuing strong uranium market fundamentals, Paladin has made the decision to return the globally significant Langer Heinrich Uranium Mine to production,” Paladin CEO, Ian Purdy, said.
“The increase in the capital required to restart operations reflects a combination of recent inflationary pressures and the bringing forward of key work packages to ensure the long term reliable supply of power and water to site.
“We have also strengthened our project execution team via the appointment of leading African EPCM contractor ADP Group to ensure the successful delivery of the Langer Heinrich Mine into production.
“The Langer Heinrich Mine remains a low risk, robust, long-life operation that is poised to take advantage of the improving uranium market conditions and deliver sustainable value creation for all our stakeholders.”
Highlights
• The Paladin Board has made the decision to return the Langer Heinrich Mine (LHM) to production with first volumes targeted for the March quarter of CY2024
• Decision to restart production at the Langer Heinrich Mine is supported by strong uranium market fundamentals and continued progress on uranium marketing activities including the execution of a binding contract for the previously announced Tender Award
• The restart scope of work will focus on general repairs and refurbishment required to return the existing process plant to operational readiness, coupled with the delivery of process upgrades to increase throughput capacity and operational availability
• Mobilisation of the project workforce is well advanced with current activities focused on detailed engineering and design for process upgrades, material and equipment purchasing and the preparation for the commencement of construction works
• The ADP Group has been appointed to provide EPCM services and will project manage the work packages and contract management alongside the company’s owners team
• Total project capital expenditure has increased to US$118M on a 100% project basis, (previous guidance of US$87M), primarily driven by recent inflationary pressures across the project supply chain, brought forward power and water infrastructure works and increased owners team costs
• Paladin has committed to provide 100% project funding, if required, via priority loans to be repaid in priority to all outstanding shareholder loans. The Langer Heinrich Mine’s minority shareholder, CNNC Overseas Uranium Holding Limited (25% ownership), are yet to finalise their funding decision
• With US$177.1M in unrestricted cash as at 30 June 2022, Paladin is well positioned to deliver first production from the LHM, pursue further uranium marketing activities and advance the global exploration portfolio
• The company’s non-project FY2023 cash expenditure guidance is US$14.7M.
For further information please visit: https://www.paladinenergy.com.au/
