FEED lowers Salamanca uranium mine’s upfront costs

JOHANNESBURG (miningweekly.com) – The Salamanca uranium mine in Spain has been confirmed as one of the lowest-cost uranium developments in the world, Aim- and ASX-listed Berkeley Energia reported on Thursday, as it published a new capital cost estimate for the project.

The Salamanca mine, which will produce 4.4-million pounds a year over ten years, is expected to cost a total of €82.3-million. The estimate was prepared as part of the front-end engineering design (FEED) by engineering group Amec Foster Wheeler Group.

The FEED, which is the execution phase of a project, reported the final upfront direct cost for the Salamanca mine to be €74.7-million, a 1% reduction over the previous cost estimate of the July 2016 definitive feasibility study.

The main drivers of the optimisation were an improved sequencing of the project, an update to the design of the leach-pad, improved materials handling, optimised design of civils and an extensive procurement exercise optimising the sourcing of materials and contractor or supplier negotiations.

“The final capital costs reflect all detailed design work carried out during the FEED, and resulted in an update to the nature and quantity of materials required to build the Salamanca mine, with costs from contractors and suppliers being amended based on final bidding packages,” Berkeley reported in a statement.

The company added that a number of Spanish engineering groups have provided their input into the study work, including Madrid IBX-35 listed companies Ferrovial and OHL.

Last year, Berkeley raised $30-million, which paved the way for Berkeley to accelerate development of the Salamanca project. The project benefits from well-established EU-funded infrastructure.

"Since our successful fundraise late last year, the site has been prepared for full construction and we now have nearly 70 staff and contractors on site," commented MD Paul Atherley.

At 4.4-million pounds a year, Berkeley will be a top-ten global uranium producer. The company believes uranium demand will be driven by China’s drive to double its nuclear capacity by 2020, and again by 2035.