Paladin Energy Cuts 2011 Uranium Production Outlook

Published on Saturday January 22 2011
 

Uranium-miner Paladin Energy on Friday downgraded its production forecast for the 2011 financial year, after a slower-than-expected ramp-up at its Kayelekera operation, in Mali.

The miner said that it expects to produce between six-million and 6,3-million pounds of uranium oxide (U3O8) in the year ending June, from a previous forecast of seven-million pounds of U3O8.

Paladin explained that the delays in ramp-up during the first half of the financial year, was owing to abnormal downtime, resulting from power and maintenance disruptions.

However, management was “confident that this conservative revision” would be met and installed capacity would be maintained going forward, as operational efficiencies and plant availability improved.

Despite the ramp-up issues, Paladin increased production by 15% to 534 201 lb at the Kayelekera operation in the December quarter.

The ASX- and TSX-listed miner also reported a 4% increase in its Langer Heinrich production, in Namibia, with the operation producing some 932 731 lb of U3O8.

Paladin noted that mining activities at the Langer Heinrich operation had been advanced prior to stage-three initiation, with three working areas expected to supply ore feed in 2011.

With its stage-three expansion, Paladin was hoping to increase the existing plant throughput to 5,2-million pounds a year, up from the current 3,7-million pounds a year.

The construction of stage three continued during the quarter under review and was expected to be completed during the March quarter of this year, allowing production commissioning and ramp-up to proceed.

The project completion, which was initially expected to be done by January, has been pushed back as a result of a delay in the delivery of critical path equipment, including boilers. This has pushed back the mechanical completion of the project by around two months.

Paladin also reported that a bankable feasibility study into a stage-four development at the Langer Heinrich project had been initiated, for the expansion to ten-million pounds of U3O8 a year.

The study was investigating a new plant to be located adjacent to the existing plant, with a total production capacity of around 8,7-million pounds a year.

Further, the potential for a heap leaching or upgrading the below cutoff grade material waste rock, to recover a further 1,3-milion pounds a year, was also being investigated.

The feasibility study was scheduled for completion during the last quarter of this calendar year.

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