Resource upgrades prompt revised Mulga Rock study

The updated mineral resource estimates for the Ambassador and Princess deposits mean the total contained uranium in Mulga Rock East now stands at 71.2 million pounds U3O8 (27,387 tU), up from 56.7 million pounds, at a cut-off grade of 100 ppm, the company announced today. 86% of the Mulga Rock East uranium resource is now in the Measured and Indicated classification. Total U3O8-only mineral resources for the project, which comprises Mulga Rock East and Mulga Rock West deposits, are 104.8 million pounds U3O8 (measured, indicated and inferred).

The inventory of so-called critical minerals (copper, nickel, cobalt, zinc and rare earth oxides) has also increased by 200% to 400% (for base metals) compared with the previously reported inventory, the company said.

Deep Yellow Managing Director and CEO John Borshoff said the results to date confirm expectations for the project. "When we acquired Mulga Rock through the Vimy Resources merger in August 2022 we identified significant opportunity to uplift the value of the project by considering extracting the critical minerals (Cu, Ni, Co, Zn, Nd, Tb, Dy, Pr) in addition to the uranium associated with the Ambassador and Princess deposits," he said.

"The results to date confirm our positive expectation for this exciting project with results illustrating the potential value uplift that could be captured by the integrated development approach. The updated MRE has delivered an impressive 26% increase in the uranium resource and more than doubled the critical minerals’ inventory. This fully justifies proceeding with the DFS revision, which will kick off in Q2 2024, to determine the overall viability of the polymetallic resource that has been delineated with uranium still remaining the key value driver of the Project," he added.

Mulga Rock is 290km by road east-northeast of Kalgoorlie in the Great Victoria Desert of Western Australia. A definitive feasibility study (DFS) prepared by then-owner Vimy Resources in 2018 - which was refreshed by Vimy in 2020 - showed a strategic long-life uranium project with a contemplated production rate of 3.5 million pounds per year. Existing environmental approvals allow for the recovery of critical minerals. The Government of Western Australia's December 2016 approval of the project stipulated that Vimy must begin substantial commencement within five years, a condition which the company met when work on the excavation of a ramp at the Ambassador North pit began in 2021.

The revised DFS will use the updated mineral resource estimate and previously announced metallurgical testwork on the recovery of critical minerals. It will integrate re-scheduling of the mining, using a less selective approach, and "potentially capturing much greater value presented by the coincident uranium and critical minerals of the Mulga Rock East deposits while operating within the permitting footprint," the company said.

Borshoff reiterated that the company intends to make a final investment decision for its Tumas project in Namibia in the third quarter of this year, with assets planned for production by 2026 at Tumas and 2028 at Mulga Rock.