Leech told Mining Weekly Online that Rössing had negotiated its contracts during the 2006 period of ascendancy in the uranium market.
“We are well covered out to 2015,” he said, 2015 being the mine life prior to the go-ahead of Rössing’s life-of-mine extension.
Rössing received its life-of-mine extension in 2005 and was out filling its order book the next year, when the price was on the rise.
He said that the uranium market hinged on the building of nuclear power stations, which had lives of 60 years and more.
They therefore required 60 years of uranium supply, “and that’s the way we should look at the market – long term. That's the basis of how we work,” he said.
While the company was “not fully contracted”, it was “well contacted”.
There were a mixture of contract durations, some companies wanting five-year contracts and others looking for ten-year and 15-year contracts.
The uranium price decline and volatility lay in the spot price of uranium and not in the long-term price, which was at $70/lb, Leech said.
While what took place in the short term did influence the thinking of uranium miners, Rössing’s approach had always been to secure customers who were looking for long-term supply.
“We’ve got customers who have been with us since the day we started, and who are still with us for a long way ahead,” Leech added.
Rössing’s nameplate capacity was 4 500 t/y and this year’s target was to achieve a production of 4 000 t of uranium oxide. The company was aiming for a grade of 0,365% as a long-term average.
The company was pushing to reach nameplate capacity by 2012, with current plant.
The company had considerable near-mine brownfields expansion potential.
With additional drilling and higher price, Rössing had already extended mine life to 2021 and its objective was to extend that still further and to increase available volumes and lower unit costs.
The company recommenced its exploration drilling programme only in 2006.
The company was building a trial heap-leach pad to process material that could not currently be tank leached, which had the potential to increase volume still further.
The building of a sulphuric acid plant was also under consideration.