PERTH (miningweekly.com) – An optimisation study into ASX-listed Peninsula Energy’s Lance uranium project, in the US, has enhanced the project’s economics, increasing its net present value by some 15%, to $305-million.

The optimisation study, which was conducted over six months, included an updated Joint Ore Reserves Committee-compliant resource, which now stood at 53.7-million pounds of uranium oxide (U₃O₈), but used the same operating parameters modelled in the feasibility study.

The feasibility study assumed that ore would be processed from the Ross, Kendrick and Barber units, and would feed into a central processing plant with a capacity of up to three-million pounds a year.

Peninsula said on Thursday that the optimisation study assumed that further production units would be permitted at Kendrick and Barber, and would follow Ross into production at consecutive intervals. The assumption included the conversion of 21.9-million pounds of the 36.5-million pounds of currently inferred U₃O₈ resource into the indicated category, or better.

“We are extremely pleased with the optimisation and progress achieved since the appointment of the production team; it has delivered substantial cost savings and added significant value to the Lance project,” said executive chairperson Gus Simpson.

He noted that the Lance project was ready to be progressed to the construction stage, subject to the current permitting and project funding status. Total construction time was estimated at 12 months, with first commercial U₃O₈ production estimated in 2014, subject to final permitting.

The Ross project was granted a permit to mine in November of last year, making up the second of three licences required for mineral recovery to occur at the Ross project.

The final licence required before the start of production was the combined source and by-product material licence.

Peninsula had to date completed engineering design to allow for certain pre-licence construction, such as the installation and testing of a deep disposal well, the installation of production monitoring wells, and the ordering of certain components of the central processing plant (CPP) and civil works in preparation for the CPP and its footings, to start.

Peninsula had also executed agreements to raise some $22-million through senior secured notes, and a further $11.72-million through a share placement to fund the project development.

The company had also launched an application for up to $70-million in industrial development bonds, which if successful, would be used for the completion of the CPP.