Valencia developers confident about project
Forsys Metals, a Canadian based uranium exploration company, announced recently that it will consolidate its two projects in Namibia, a move which will put the company in a position to boost its uranium reserves.
This week, Marcel Hilmer, the chief executive officer of Forsys Metals, said the assessment of the consolidation of the Valencia and Namibplaas projects is progressing well.
“We remain confident of achieving improved economics over and above those reported in the 2010 Snowden Technical Report on Valencia. We are currently completing the Phase 2 drilling programme at Namibplaas and will file an updated resource statement for that project in the third quarter of 2012. After that, we plan to conduct a definitive feasibility study that would serve to optimise the economic potential of the combined projects,” Hilmer told the Economist.
The feasibility study is expected to be complete in 2013 and the company expects to achieve commercial production in 2015.
The consolidation of the Valencia and Namibplaas will boost the company’s reserves by 30%. By merging the two projects, the company’s planned output will increase to 5 million pounds per annum, up from 3.7 million per annum.
“Based on the 2010 Snowden Technical Report completed for the Valencia project, the average production output for that project is estimated to be 3.7 million pounds per year. The consolidated profile for both Valencia and Namibplaas together, is targeting at least 5 million pounds per year. Acknowledging that we have existing approvals to commence mining today, we are striving to achieve the goals as outlined that will further enhance our flagship projects over the next 18 months,” said Hilmer.
More than 400 jobs will be created when the plant reaches commercial production and while the company is not fully operational yet, the Namibian community is benefiting from the company’s presence.
Forsys Metals is currently running two social responsibility campaigns in order to give back to the local community, including the Usakos Community Vegetable Project which will enable the community to produce fresh vegetables for the Valencia mine village and the Usakos market. The other campaign is the Bursary Scheme through which financial support is provided to five students to educate them in the fields of mining engineering, geology and accounting. The successful students will join Forsys Metals upon the completion of their studies.
Forsys Metals’ wholly owned Valencia Uranium Project has uranium reserves of 60.5 million pounds with an average grade of 156ppm. The company has a 25-year mining licence.
This year, the company’s activities are focused on completing studies of consolidation of milling from both the Valencia deposit and the Namibplaas projects and potential use of heap leaching to increase uranium recovery rates and to reduce processing costs. It is also focused on completing the second phase of the 40 000meter drilling programme at the Namibplaas Uranium Project this month.
Hilmer expressed confidence over the uranium price, stating that the price of this resource will increase over the mid to long-term. “We remain confident that the price of uranium will continue to increase over the mid to long term period and that this will translate to greater profitability. There will be a significant increase in demand over the coming years and projections confirm that supply will meet this demand.
“For example, there is expected to be a 30% growth in the number of reactors by 2020. The growth is primarily being driven by China, India, Russia and even UAE who have significant number of reactors planned, proposed and under construction,” Hilmer said.
The Valencia deposit is located within the Erongo region, 25 kilometres north-east of the Rössing Uranium Mine. The extent of the area covered by the Exclusive Prospecting Licence (EPL 1496) is approximately 700 hectares.