Acquisition expands Wiluna resource base
12 August 2013
Toro Energy has agreed to acquire the Lake Maitland uranium project from Mega Uranium in a move that will provide a raft of benefits for the development of its nearby Wiluna uranium project in Western Australia.
 250.jpg "Lake Maitland exploration (Mega Uranium) 250") |
| Earlier exploration work at Lake Maitland (Image: Mega Uranium) |
Lake Maitland is 90 km southeast of the proposed processing facility at Wiluna and the two shallow orebodies are geologically similar, offering the potential for operating synergies. Combining the two projects will result in a significantly larger combined resource base, expanding Wiluna's JORC resources by 42% from 54 million pounds U3O8 (20,771 tU) to 76 million pounds U3O8 (29,233 tU), which according to Toro could potentially support a 20-year life for the project. The higher grade material found at Lake Maitland is also expected to improve the overall blended grades at Wiluna, while the increased resources also provide possible opportunity to expand the project.
Toro has already secured environmental permits for its first two deposits at Wiluna, which are expected to come into production in 2016. The acquisition means that Lake Maitland could potentially be developed quicker than as a stand-alone project, while one central processing facility could treat ore from both projects potentially providing for significant capital savings.
Lake Maitland already has existing strategic partnerships with Japanese partners JAURD International Lake Maitland Property (in which Japanese utilities Kansai, Kyushu and Shikoku hold major shares) and Itochu Minerals & Energy of Australia, which Toro will inherit through the acquisition. The transaction also brings AUD 3.5 ($3.2 million) of additional capital to the project: AUD 1.5 million ($1.4 million) of cash reserves included in Lake Maitland's assets, plus equity subscriptions totalling AUD 2 million ($1.8 million) from Toro's strategic partner OZ Minerals and Mega Uranium shareholder Pinetree Capital.
Toro managing director Vanessa Guthrie said that the company looked forward to welcoming Mega as a "strategic cornerstone investor" and to working closely with its Japanese strategic investors. "Lake Maitland adds significant scale to our Wiluna Project and further strengthens the Wiluna investment case," she said. Likewise, Mega's president Stewart Taylor said the integration of Lake Maitland into the wider Wiluna project would unlock benefits for the shareholders of both Toro and Mega, "given the proximities and similarities of the main deposits".
The acquisition, which is conditional upon various approvals, is expected to be completed soon after a meeting of Toro shareholders in early October and will see Toro acquire Lake Maitland for 415 million of Toro's fully paid ordinary shares. On completion, OZ Minerals will own a 28.5% interest and Mega Uranium a 28% interest in the issued capital of Toro.
Researched and written
by World Nuclear News