Uranium One takes reins at Mkuju River

Uranium One has become the operator of the Mkuju River uranium project in Tanzania following the acquisition of Mantra Resources by AtomRedMetZoloto (ARMZ) and will manage the development of the project and other Mantra exploration activities.

ARMZ, which owns 51% of Uranium One, has now completed its purchase of Australia-based Mantra Resources, which boasts Mkuju River as its key project with JORC-compliant measured and indicated resources of 25,250 tU and inferred resources of 13,800 tU at an average ore grade of 0.037%. The deal to buy Mantra, originally announced in December 2010, was almost derailed in the wake of events at Fukushima in Japan which were alleged to have materially affected Mantra's business. However, ARMZ and Mantra managed to work out an alternative approach allowing the deal to go ahead.
 
Under an operating agreement entered into by ARMZ, Mantra and Uranium One on 6 June, Toronto-based Uranium One will manage the development of the Tanzanian project in accordance with a revised feasibility study due for completion in early 2012. Work programmes are to be approved by Uranium One and ARMZ. Uranium One will also provide a credit facility to fund the development of Mkuju River and other Mantra exploration facilities. ARMZ will guarantee the credit facility.
 
Uranium One already has in place a call option to acquire Mantra from ARMZ, and ARMZ has a put option to sell Mantra to Uranium One, at the end of a 12-month period which under certain conditions could be extended to 24 months.
 

Researched and written

by World Nuclear News