enCore Energy Corp. (TSX-V: EU) (OTCQB: ENCUF) is pleased to announce the results of a Preliminary Economic Assessment for the company’s recently consolidated Juan Tafoya and Marquez projects located in the Grant’s Uranium District in northwest New Mexico. This is the first PEA for the projects as this is the only time in recent history that the two contiguous mineralized properties have been held under the same company. The PEA was constructed based on a combined and updated NI 43-101 Technical Report using an Indicated resource of 7.1 million tons at a grade of 0.127% eU3O8 for a total of 18.1 million pounds of U3O8.
The PEA reports the Net Present Value for the project that ranges from $20.9 million using $60.00 per pound of yellowcake (U3O8) to $71.2 million using $70.00 per pound of yellowcake with internal rate of returns ranging from 17% to 39% with corresponding yellowcake prices; these scenarios are pre-tax and assume a 7% discount rate. The break-even price of production is estimated to be $56.00 per pound.
“This initial PEA enables enCore to illustrate the economic opportunities of the combined Juan Tafoya and Marquez deposits which have been consolidated with the Westwater Resources transaction completed at year end 2020. This report assumed conventional underground operation and recovery through a newly constructed conventional mill, though the authors did acknowledge that further research may prove the property amenable to either in-situ recovery (“ISR”) or heap leach processing; either of which would have a positive material impact on the economic conclusions of the current PEA.” said Paul Goranson, Chief Executive Officer. “This study points to the economic importance of our conventional assets in New Mexico, with further work it may well be determined that some, or conceivably most, of the uranium at Juan Tafoya-Marquez might be amenable to lower cost recovery options including ISR or heap leaching.”
The PEA evaluated the economics of mining at Juan Tafoya-Marquez through underground mining and on-site processing (milling) to produce yellowcake. The study has an effective date of June 9, 2021, and was prepared by Douglas L. Beahm, P.E, P.G., of BRS Inc. in cooperation with Terence P. McNulty, P.E., PhD, of McNulty and Associates.
PEA Summary Mine Plan and Operating Assumptions
|Total Tons mined||6,033,000|
|Total Tons Waste mined||1,392,000|
|Total Tons of Resource mined||4,641,000|
|Total Pounds Yellowcake ( U3O8 ) Contained||12,184,000|
|Average Diluted Grade % U3O8||0.188%|
|Total Pounds U3O8 Recovered @ 95% recovery||11,575,000|
|Life of Mine||15 years|
PEA Summary Capital and Operating Costs
|Initial Capital Costs (including contingency)|
|Mine Direct Capital||$42,110,000|
|Mill and Tailings Capital||$37,200,000|
|Total LOM Capital Costs||$79,310,000|
Life of Mine Cost Summary
|Cost Center||Total Cost US$ (x1,000)*||Cost per Pound Recovered US$|
|Decommissioning and Reclamation||$13,000||$1.11|
|Taxes and Royalties||$53,000||$4.55|
|TOTAL OPEX (LOM)||$558,000||$48.10*|
PEA Summary Economics at $60.00/lb. Yellowcake (U3O8)
|Pre-tax and Royalty NPV at 7%||$20,595,000|
|Pre-tax and Royalty IRR||17%|
|Post Tax and Royalty NPV at 5%||$18,473,000|
|Post Tax and Royalty IRR||16%|
|Post Tax payback||5.0 years|
|Total LOM Revenue||$694,474,000|
|Total LOM Direct Costs||$523,699,000|
|Total LOM Royalties||$33,566,000|
|Total LOM Taxes||$3,225,000|
|Total cash Flow after taxes and royalties||$54,674,000|
|Cash Cost ($/lb. U3O8)||$42.53|
The base case summarized above assumes the owner will purchase all mining equipment. The base case assumes mining and milling at an average rate of 1000 tons per day year-round
|U3O8 Price US$/lb||$60||$65||$70|
|Pre-Tax NPV 5% $000||$20,914||$50,970||$71,199|
The mineral resources used in this PEA include Indicated mineral resources estimated by Douglas Beahm. The resources are found in two different stacked sands currently identified on the Juan Tafoya-Marquez property. Mineralization occurs in a third upper sand but is insufficiently defined to be included in this report. The in-situ estimates used electronic logs from 926 drill holes and over 575,809 meters of drilling.
Indicated Mineral Resources
|Indicated Mineral Resources|
|Minimum 0.60 GT||TONS||%eU3O8||Pounds|
|ROUNDED TOTAL (x 1,000)||7,100||0.127||18,100|
The PEA is only summarized in this press release as an initial high-level review of the project the complete detailed report will be filed on SEDAR within 30 days of this press release. The PEA is preliminary in nature. There is no guarantee that the project economics described in this report will be achieved.
The independent qualified persons responsible for preparing the Juan Tafoya-Marquez Preliminary Economic Assessment are Douglas L. Beahm, P.E., P.G., of BRS Inc. and Terence P. McNulty, of McNulty and Associates.
Douglas H. Underhill, PhD, CPG, enCore’s Chief Geologist, is the Company’s designated Qualified Person for this news release within the meaning of NI 43-101 and has reviewed and validated that the information contained in the release is consistent with that provided by the QP’s responsible for the PEA.
About enCore Energy Corp.
enCore Energy Corp. is a U.S. domestic uranium developer focused on becoming a leading in-situ recovery (ISR) uranium producer. The Company is led by a team of industry experts with extensive knowledge and experience in the development and operations of in situ recovery uranium operations. enCore Energy’s opportunities are created from the Company’s transformational acquisition of its two South Texas production facilities, the changing global uranium supply/demand outlook and opportunities for industry consolidation. These short-term opportunities are augmented by our strong long term commitment to working with local indigenous communities in New Mexico where the company holds significant uranium resources including the NI 43-101 resources at the partially permitted Crownpoint-Hosta Butte property and the NI-43-101 resources at the Juan Tafoya-Marquez property.
Noront Board recommends shareholders accept the offer Cons... READ MORE
FIREWEED ZINC LTD. (TSX-V: FWZ) is pleased to announce a successf... READ MORE
Four drill rigs active at Fenn-Gib North Block 23,241m completed ... READ MORE
Erdene Resource Development Corporation (TSX: ERD) (MSE: ERDN) is... READ MORE
Northern Vertex Mining Corp. (TSX-V: NEE) (USOTC: NHVCF) a Western U.S.... READ MORE
We acknowledge the [financial] support of the Government of Canada.