Lotus Resources (ASX: LOT) is closer to redeveloping its Kayelekera uranium project after the Malawi Government renewed the mining licence for a further 15 years.
Malawi’s Minister of Mines Rashid Gaffar extended the mining permit, along with existing exploration licences, for the project at the start of this month.
Lotus managing director Keith Bowes said the renewal of the mining and exploration licences was a “critical” step for the company.
“It provides certainty and confidence to our investors that Lotus has the full backing of the government to continue our ongoing development of Kayelekera, as we position the project to be one of the first assets to recommence production in an ever-improving uranium price environment.”
Mr Bowes noted the Malawi Government owned 15% of the project and would receive “significant benefits” from its restart as well as local communities.
Kayelekera uranium project
Kayelekera was operated between 2009 and 2014 and produced 11 million pounds of uranium.
It was closed due to the falling uranium price at the time.
Lotus has firmed up a resource at Kayelekera of 27.1Mt at 630 parts per million uranium for 37.5Mlb.
Last week, Lotus kicked off work on a definitive feasibility study into the project’s restart.
The study follows positive results from recent technical work including evaluation of power supply, ore sorting, acid recovery and tailing.
Study results indicate potential for enhanced outputs and returns compared to an earlier scoping study released in October last year.
Mr Bowes said the ore sorting work had been the most “notable” technical study.
Ore sorting is based on a new technology that was not available when Kayelekera was previously operated.
The work demonstrated ore from the project could be upgraded to boost output.
“This means for example that a 400ppm uranium oxide marginal ore could be upgraded to around 800ppm uranium oxide in feed for the main plant,” Mr Bowes explained.