Paladin upgrades Malawi uranium project resource base

Australia-based uranium producer Paladin Energy has announced that infill and extension drilling at its Kayelekera deposit, in Malawi, had added significantly to the estimated resources base, and had increased the estimated life-of-mine.

The drilling results also allows most of the resources to be classified in the Measured and Indicated categories, with a small percentage retained as Inferred Resources.

The drilling programme, which was carried out in 2008, consisted of 132 reverse circulation drill holes, of which about 50% were assayed for uranium, using analytical methods to establish disequilibrium parameters for subsequent application to unassayed, radiometrically logged drill hole intervals.

Paladin CEO and MD John Borshoff stated that the previous mineral resource was estimated at 15,31-million tons of Measured and Indicated Resource, with a grading of 0,09%. Following the infill and extension drilling, Measured and Indicated Resources amounted to 22,20-million tons, with a grading of 0,08%.

The increase in tonnage and decrease in grade was owing to the high-grade core of the deposit as well defined by previous drilling and the new drilling, focused mainly on defining the peripheral zones of the deposit.

The new reserve estimate also suggested an increase in life-of-mine of one-and-a-half years, to nine years at a production rate of 3,3-million pounds a year of uranium, when the inferred material was included. The processing of marginal ores at the end of mine life was also expected to add an additional three to four years to the project life.

“The 2008 drilling has also shown that the mineralisation is not yet fully delineated, particularly in the north west and west, and thus potential exists to easily identify additional resources with future drilling, which is expected to provide in-pit extensions,” Borshoff said.

He added that the improved resource status of the project, and the good exploration results overall, gave high confidence that with further exploration drilling on the defined prospective targets, the life of the Kayelekera operation could be expanded considerably from what was presently indicated.

“In addition, the solid improvement of the spot uranium price of the past three weeks, together with market indicators showing evidence that the uranium price will continue to strengthen, confirms that the Kayelekera project is in a very strong position to benefit, at a time when it is getting ready to start is commissioning and ramp-up phase at the start of the March 2009 quarter.”