PERTH (miningweekly.com) – ASX-listed Marenica Energy and fellow-listed Deep Yellow have inked a technology licence agreement that will see Marenica provide its U-pgrade technology to develop the Tumas uranium project, in Namibia.

Marenica’s U-pgrade technology could potentially deliver significant project and operating cost savings at Tumas, and the two parties have agreed to share the potential value created by combining the Tumas resource with the technology.

Under the terms of the technology licence agreement, Deep Yellow will be allowed to apply U-pgrade technology in return for a long-term licence fee, which will equate to around 25% of the Tumas project’s net present value, under a range of possible development scenarios.

The fee will be capped at $4.80/lb of uranium when the uranium price received exceeds $80/lb, and will be nominal when uranium is sold at a price below $50/lb.

Deep Yellow will fund all project development expenditure, including the total cost of the pilot plant and testwork, while also paying Marenica a series of milestone success fees during the feasibility study and development phase.

Marenica MD Murray Hill said on Monday that the Tumas project was a good fit for the company’s first commercial agreement, based on the project’s high suitability for the technology, its relatively advanced stage of development, and the cultural fit between the two companies.

“We are truly excited by our first commercial agreement which gives [us] confidence that our technology not only has a valuable application in the real world, but that third party resource owners recognise this and are prepared to pay for the value it brings to their projects,” said chairperson Doug Buerger.

Recent testwork conducted at the Tumas site demonstrates that processing ore from the mine through the U-pgrade process has the potential to reject up to 98% of the mass while recovering 82% of the uranium, representing the potential to dramatically reduce both capital and operating costs, and enabling Deep Yellow to develop the project at a lower uranium price.

Deep Yellow MD Greg Cochran said that the technology agreement would enable the company to accelerate the development of the Tumas project, leveraging off the potential to capture significant cost benefits as a result of the application of the technology.

The Tumas project has a current Joint Ore Reserves Committee-compliant resource of 14.8-million tonnes, at 366 parts per million for 11.9-million pounds of U₃O₈.