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« Barbara Thomae: Uranium Will Rebound with Economy | Main | Extract Resources Limited: 300 M lbs by the end of the year »

Extract Resources Limited Potentially World Class

EXT Logo 26 May 09.JPG

Extract Resources Limited (ASX/TSX: EXT) issued the following media release today stating that preliminary cost estimates study confirms Rossing South’s potential to be one of world’s largest uranium mines.

Study highlights are as follows:

• Production rate 15.0 M tpa
• Estimated head grade 487 ppm U3O8
• Mill Recovery 92%
• U3O8 production 14.8 M lbs / year (6.7 K tpa)
• Project capital estimate US $704M
• Production cost estimate US $23.60 /lb U3O8

The report goes on to say that preliminary cost estimates on the granite hosted, uranium mineralisation at Rossing South in Namibia indicates that the project can support a viable open pit mining operation developed to feed a 15M tpa agitated tank sulphuric acid leach processing plant. Annual production has been estimated at 14.8M lbs U3O8 with capital costs estimated at US$704M and operating costs of US$23.60 per lb U3O8.

Mr McIntyre added this comment “the availability of infrastructure combined with the confirmed resource and the outstanding exploration potential still to be tested on the Husab project, should ensure a long and successful mining operation centred on Rossing South.”

All of this is terrific news for the shareholders.

Power is expected to be sourced from Nampower with an expected demand of about 35 MW. Nampower is currently completing an Environmental and Socio Economic Impact Assessment to construct a new coal fired power station in the Walvis Bay area with three capacity scenarios being considered to provide 200, 400 or 800 MW of electricity.

Water for the operation is expected to be sourced from a proposed seawater desalination plant located between Swakopmund and Henties Bay. There have been discussions with several parties regarding the prospect of a collaborative desalination project to meet the needs of multiple industrial customers in the region. Namwater are expected to be the main supplier of this service.

However we should note that there is a long time span between having completed a study to actually commissioning a coal fired power station and the same goes for the Approval, Design, Construction and Commissioning of a desalination plant.

Have a good one.

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Reader Comments (3)

kalahari listed on london exchange is holding 40% of shares of extract resources and its market capitalisation is much lower than extract, so it can go up big way

August 4, 2009 | Unregistered Commenterjoe

For comparison on discounts for KAH.l (Kalahari Plc), URU.l (Niger Uranium Plc) and EML.l (Emerging Metals Plc) versus Extract Resources see:

August 6, 2009 | Unregistered Commentersd

kalahari is postioned in two of the most volitile[sp?], areas in the world. recently having projects stymied in mongolia while mining rights are being ironed out [no pun intended]. a very intriguing compnay.

August 9, 2009 | Unregistered Commenterrichard

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