TORONTO (miningweekly.com) – Uranium project developer Laramide Resources has struck an accord with the operator of the only operational US uranium mill to process material from its fully owned La Sal II uranium mine, in Utah.
The two-year agreement, with an option to extend it to three years, would see fellow TSX-listed Energy Fuels process up to 20 000 t at its White Mesa mill during a test phase.
Laramide said it would pay Energy Fuels the costs to mill its ore, a capital charge plus a toll milling fee per ton of ore, which would be partly linked to the long-term uranium price.
Laramide's agreement with Energy Fuels accommodates additional ore production once La Sal II is permitted for full production.
"The considerable progress made at La Sal II over the past few years meets our stated objective of near-term production visibility from our US asset base. We look forward to delivering on our next development and operational targets and for continuing recovery in the uranium markets," Laramide CEO Marc Henderson said.
“This transaction also underscores the strategic importance of owning the only operating uranium mill in the US that is within trucking distance of a large resource base with significant historical production. Over time, we expect to grow this type of revenue source by signing toll milling and/or ore purchase arrangements with other uranium property owners in the region who will require the functionality of the White Mesa mill in order to mine and generate revenue from their properties,” Energy Fuels CEO Stephen Antony added.
Energy Fuels will use samples from Laramide's bulk sample programme to confirm metallurgical and mill compatibility and then process the 20 000 t. The fully permitted bulk sample programme allows Laramide to start underground development activities, and with positive results, would allow for a commercial production decision at La Sal II.
Henderson early in November told Mining Weekly Online the company would use its two near-term uranium projects in the US, the other being the La Jara Mesa project, as well as a royalty option on a near-term uranium project, to bridge the gap to production at its flagship Westmoreland project, after a decades-long ban on mining the radioactive metal in Queensland, Australia was lifted in October.
Laramide’s TSX-listed stock on Friday climbed by 6.32% to C$1.01 apiece.