First reserves announced for Patterson Lake South

Thursday, 18 April 2019

Updated mineral resources for the project now stand at 103.768 million pounds U3O8 (39,914 tU) of indicated resources at an average grade of 1.85% U3O8, which is an increase of 18% compared to the previous estimate reported in February 2018. Inferred resources are 32.886 million pounds U3O8. Mineral resources include total probable mineral reserves of 90.5 million pounds U3O8, with 82.3 million pounds mineable by open pit methods and 8.2 million pounds by underground mining. Mineral reserves are resources that can be viably mined and are classed as "proven" and "probable".

Ross McElroy, Fission's president, COO and chief geologist, said the study presented a "very strong base case" for production at PLS, improving the potential economics and de-risking the project. "Particular highlights include very low operating costs, a high internal rate of return and broad scope for growth and optimisation," he said.

There is further potential to add resources to the two ore zones - R00E and R780E - on which the PFS focuses, and from three other known mineralised zones which may increase mine life and improve economics, he added.

The PFS is based on an open pit/underground hybrid mining operation, but Fission is also progressing a preliminary economic analysis (PEA)-level underground-only alternative scenario that indicates potential for improved economics, the company said.

For the combined open pit/underground operation, the PFS found operating costs of USD6.77 per pound U3O8, which is less than the USD12.38 per pound estimated in the 2015 PEA technical report for PLS. Production averaging up to 15 million lbs U3O8 per year over the first five years from 90.5 million pounds of reserves is envisaged, with a four-year construction period and 8.2-year mine life.

Fission continues to advance PLS to feasibility status, McElroy said.