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A-Cap Energy shelves Letlhakane Uranium Project to 2021

Publishing Date : 20 January, 2020


The Letlhakane Uranium Project (LUP) has postponed the construction of its proposed mine to 2021 due to depressed uranium prices on the global market.  The LUP, owned by Australian-based A-Cap Energy Limited said it request to postpone the project had been approved by the Ministry of Mineral Resources, Green Technology in August 2019.

LUP is one of the largest undeveloped uranium deposits in the world.  “The depressed uranium price has necessitated an amendment to the planned forecast whereby A-Cap would commence construction activities and enter production,”Angang Shen, A-Cap chairperson said in the company’s 2019 annual report released this week.  “The Botswana Minister of Mineral Resources, Green Technology and Energy Security (the Minister) approved a request from A-Cap to delay the pre-construction and construction period by two years to October 2021, which more closely aligns with the forecasted improved uranium prices.

“The Minister approved the Company’s requested amendment on 20 August 2019. A-Cap ensures as a key priority full compliance with all the requirements of the mining licence to ensure continued good standing, including defining the boundary of the mining licence with beacons, clearing and demarcation and report submission in a timely manner,” he said. Shen said the project had all the major infrastructure in place and was adjacent to Botswana’s main North-South infrastructure corridor, that includes the A1 Highway, railway line and the national power grid.

“The Company were granted a mining Licence (ML 2016/16L) for the Letlhakane Uranium Project effective from 12 September 2016 by the Botswana Ministry of Minerals, Energy and Water Resources, which is valid for a period of 22 years.  “The mining licence was granted on the back of a technical study and financial modelling of a shallow open pit mine and heap leach operation to produce up to 3.75 million pounds of uranium p.a. over an 18-year mine life,” said Shen.

However, the depressed uranium prices have forced the shelving of the project to October 2021 pending an increase in uranium prices. “The Botswana Letlhakane Uranium Project has been largely put on hold pending an increase in uranium prices. The strategy referred to in last year’s annual report was to diversify into other commodities, and your company’s move into battery related minerals, specifically nickel and cobalt, is in line with our energy related strategy. Both of the Company’s projects are situated in stable countries which is necessary for high tonnage, long life projects,” said Shen in his notice to shareholders.

He said numerous marketing studies clearly spell out the future of the uptake of electric vehicles throughout the world. “Batteries required to power these vehicles are made in mega-factories which are currently coming into production or are about to come on-line. Almost exclusively, these factories are being built to make lithium ion battery cells using two chemistries: nickel-cobalt-manganese (NCM) and nickel-cobalt-aluminium (NCA),” said Shen.

“Late 2017, the board of directors resolved to diversify its minerals portfolio and expand its energy focus to not just the Letlhakane Uranium Project, but also cathode materials production and supply to the battery industry,” he added.  An acid consumption study on the Letlhakane Uranium Project was completed at the end of the 2018.  “The study focused on improving project economics by way of reducing acid consumption and acid costs, which comprise a significant amount of the project’s CAPEX. The optimisation studies identified that savings of up to 26 percent in acid consumption was possible.

“The next phase of optimisation work has been defined, the board will manage the staged optimisation works in line with our timetable to production as set out in the mining licence, which was obtained in September 2016 for a period of 22 years,” said Shen. “The Company’s Letlhakane Uranium Project located in Botswana remains an important project asset within the diversified mineral strategy. While the nuclear industry is confident in the long-term fundamentals of uranium and nuclear power, there is less certainty in the short term with industry expectation that the market will gradually move towards balance from calendar year 2023.”



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