Boss Energy on-track to become Australia’s next uranium miner

Boss Energy (ASX: BOE) is on track with its strategy of becoming Australia’s next uranium miner from its Honeymoon project in South Australia, with an enhanced feasibility study recently returning financially robust results.

Boss managing director Duncan Craib said the June quarter had been “transformational” for the company.

During the period, Boss unveiled its much-anticipated enhanced feasibility study for restarting Honeymoon.

The company says the study shows the proposed uranium operation will be financially and technically robust.

Under the enhanced study, Honeymoon’s pre-tax net present value rose 35% on last year’s study to U$309 million.

Nameplate production capacity was increase by 22.5% to 2.45 million pounds of uranium per annum based on the Honeymoon restart area resource of 36Mlb. Outside of this area is a further 35.6Mlb of JORC resources which could underpin production beyond the initial 10-year mine life.

This was while cutting all-in costs by 11% to US$31.86/lb, and all-in sustaining costs by 16% to US$25.62/lb.

Meanwhile, capital costs are estimated at US$80 million. In the enhanced study, an ion exchange process has replaced the existing solvent extraction plant.

Mr Craib said the enhanced feasibility study showed “conclusively” the changes will increase annual production, while significantly cutting costs and boosting overall financial returns.

“With forecast all-in costs of US$31.86/lb and contract uranium prices running in the high US$30s/lb, Honeymoon is already poised to be an extremely robust project,” Mr Craib added.

Fully permitted

As well as debuting the enhanced feasibility study, Boss noted it had all required permits to produce, store, transport and export uranium from Honeymoon.

The company confirmed all permits were in place after a comprehensive review of all South Australian and federal government requirements during the June quarter.

These include updated permits for the increased 2.5Mlbpa production and ion exchange columns for the updated processing plant.

Uranium inventory

To de-risk Honeymoon’s restart further, Boss procured 1.25Mlb of uranium on the spot market that was funded through a $60 million share placement.

Mr Craib said the rationale behind securing the uranium stockpile was to remain fully leveraged to any future appreciation of the uranium price.

He added it also increased flexibility in securing project funding and offtake contracts while de-risking the company through the commissioning phase at Honeymoon.

Honeymoon restart

As the uranium market outlook continues to improve, Boss is seeking to lock-in offtake agreements and finalise required funding to bring the project online.

Boss is also progressing exploration at Honeymoon to boost resources and mine life further.