Photo by: Bloomberg
PERTH (miningweekly.com) – Uranium miner Paladin Energy plans to save some $33-million in capital costs during the 2016 financial year, as the company awaits a turnaround in the uranium price.
The Africa-focused miner gave a revised forecast for the C1 cash costs at its Langer Heinrich mine, in Namibia, which were expected to decline to $26/lb in 2016, based on production of 5.2-million pounds uranium, down from the C1 cash costs of $29/lb reported in 2015.
The miner said the lower C1 cash costs at Langer Heinrich were expected to result in a significant decrease in total cash costs, including royalties, transport, logistics and capital expenditure (capex), reducing from $36.44/lb in 2015, to $30.74/lb.
The reductions represented a $6/lb drop in cash costs and included the deferral of $10-million of capex to 2017.
Paladin noted that key elements of the cost reduction would include renegotiating the terms with the mining contractor, reduced reagent consumption linked to further optimisation of the bicarbonate recovery plant and the deferral of some capex.
Meanwhile, Paladin was also cutting corporate costs by some 35% to $9.7-million, while exploration would be rationalised during 2016 to focus on essential exploration, including a small amount of potentially high-impact drilling.
Total corporate and exploration costs were expected to decline by some $16-million, compared with exploration spend in 2015.
A further $5-million in savings would result from the care-and-maintenance costs for the Kayelekera mine, in Mali, in 2016, which were expected to reach $11-million.
The uranium miner said the cost-saving initiative was a key step for the company in achieving sustainability in the current low uranium price environment.
Further cost reductions were also under review and would be implemented once verified. Alongside the cost reductions, a revised life-of-mine plan for Langer Heinrich was well advanced, which could result in further operational improvements.
Paladin noted that, with the current work being done, the company could be cash flow neutral by the end of the 2015 calendar year.