Oropa sees ‘significant' uranium exploration potential in Malawi

Diversified gold and uranium explorer Oropa has secured a 90% interest in two contiguous uranium exploration projects located 20 km north of Paladin Resources' Kayelekera uranium deposit in northern Malawi, the company said on Monday.

Oropa has executed memorandums of understanding (MoUs) with the owners of the two granted exploration prospecting licences, Ngana and Ngana East, which cover a combined area of 285 km2, covering basin structures containing Karroo sediments which were similar to the host rocks at the nearby Kayelekera roll-front uranium deposit.

"We believe that Malawi offers significant opportunities for uranium exploration," commented CEO Phil Christie.

The new licences represent an important addition to Oropa's strategic land-holdings in Malawi, which currently include two granted exploration licences - Mzimba Northwest and Chitunde - and an additional licence for Chinzani (adjacent to Globe Uranium's Kanyika uranium project area), which is currently under Ministerial consideration.

Under the terms of the MoUs, Oropa would incorporate two independent Malawian joint-venture (JV) companies, which would apply for the other mineral rights to the existing licences. Oropa noted that it would hold a 90% shareholding in each.

The current holders' 10% interest is free, carried with each having the option to buy back up to a 20% contributing interest from Oropa at cost, up until one month after the start of a feasibility study - undertaken by either of the JV companies.

The Kayelekera project which has a proven and probable ore reserve of 10,46-million tons at 0,108% and is scheduled to be commissioned in late 2008 with planned production of 3,3-million pounds a year of uranium over a life-of-mine of seven years.

Oropa commented that the development of the project had sparked significant investment and interest in uranium exploration in Malawi.

"Previous and current mineral exploration in these areas has been exclusively focused on coal, with no previous uranium exploration undertaken. Because of their strategic location close to a major new uranium mine and their geological pedigree, we believe this represents an exciting opportunity for the company," Christie said.