SRK completed a Preliminary Economic Assessment (PEA) for the project in 2017. The economic analysis results indicate an after-tax Net Profit Value ("NPV") of US$112 million at an 8% discount rate, with an Internal Rate of Return ("IRR") of 25%, based on long-term uranium price of US$58/lb U3O8.
The proposed base case envisions an average 2.4 Mlb per year U3O8 yellowcake production rate, and an 88% ultimate recovery, generating an eleven-year mine life and a total forecast production of 26.4 Mlb U3O8. The project economics are at a long-term uranium price of US$58/lb U3O8. Initial capital costs are estimated at US$123 million, with total LoM capital costs at US$183 million, cash operating costs of US$31.1 / lb U3O8 excluding royalties, and US$36.4/lb U3O8 including royalties.
* As a result of the completion of the technical report titled "NI 43-101 Technical Report On the Updated Mineral Resource Estimate for The Muntanga Uranium Project in Zambia" dated effective March 31, 2023, filed on August 31, 2023, under GoviEx’s profile on SEDAR+ (www.sedarplus.ca) and GoviEx’s website at www.goviex.com, the previous report titled, “NI 43-101 Technical Report on a Preliminary Economic Assessment of the Muntanga Uranium Project in Zambia”, dated November 30, 2017 (the “PEA”) no longer reflects the current economic potential of the project, should be seen as historical in nature and should not be relied upon. As the PEA is no longer current, information related to an “advanced property” as such term is defined in NI 43-101, is no longer relevant to this technical report.
The PEA is considered preliminary in nature and includes Inferred Mineral Resources that are considered too speculative geologically to have the economic considerations applied to them that would enable them to be categorized as Mineral Reserves. Mineral Resources that are not Mineral Reserves have not yet demonstrated economic viability. Due to the uncertainty that may be attached to Inferred Mineral Resources, it cannot be assumed that all or any part of an Inferred Mineral Resource will be upgraded to an Indicated or Measured Mineral Resource as a result of continued exploration or Mineral Reserves once economic considerations are applied; therefore, there is no certainty that the production profile concluded in the PEA will be realized.