NexGen Energy (ASX:NXG) has updated the capital and operating cost estimates for the Rook I Uranium Project in the Athabasca Basin, Canada, estimating pre-production capital costs to C$2.2 billion ($2.44 billion).
The average cash operating costs over the mine life are estimated at C$13.86 per pound.
NexGen Energy, which has a market capitalisation of $5.88 billion, says the updated sustaining capital costs are estimated at C$785 million, reflecting inflationary changes and advancements of engineering and procurement, while also optimising constructability and environmental performance.
The company adds the vast majority of Rook I’s mine reclamation will occur concurrently with production through the design, encompassing the underground tailings management facility.
As a result, the environmental performance of the operation will be enhanced, while also reducing the risk of ongoing reclamation, costly decommissioning at the end of the production period, and the post-closure risk to the local environment and communities.
Due to incorporating the underground tailings management facility at the outset of the development, full closure costs are set to be C$70 million at the end of mine life.
NexGen Energy says this will be materially lower than other uranium mines in Canada.
CEO Leigh Curyer says the updated capex, opex, and sustaining capital reflects the company’s focus on thorough planning and responsible financial management, ensuring every aspect of Rook I aligns for the development of a “world-class” resources project.
“The updated capital cost presents an all-encompassing spend to bring the Rook I Project into production based on robust, proven mining, and construction methodologies, with a payback period of 12 months,” Curyer says.
“Our commitment to developing this project to the highest environmental standards ensures sustainable and responsible operations from the outset whilst delivering industry-leading profitability and local community consultation and engagement.
“This includes the incorporation of reclamation activities and the significant associated costs during operations, minimising future closure liabilities which are estimated at C$70 million for the project, and setting a higher standard for environmental performance in the mining industry.”
Curyer adds that the company is advancing the finalisation of the federal environmental assessment to begin construction on final federal approval, in parallel with continuing testing the Patterson Corridor East mineralisation, which sits 3.5km east of the Arrow deposit.
The company is currently progressing discussions with various prospective financing entities — including commercial lenders, export credit agencies, and alternative sources to secure financing for Rook I.
NexGen Energy is receiving interest in new sources of potential project financing, which would satisfy the capital requirements for Rook I, in combination with its current cash and liquid investments.
The company is also refining the current dollar cost estimates as engineering, procurement, and contracting activities advance over the coming months.
The Rook I Project is among the “largest” development-stage uranium projects in Canada. It has a consistent mine life and production capability of up to 30 million pounds of titanium octoxide per year.
NexGen Energy is a Canadian company focused on delivering clean energy fuel for the future.
Write to Aaliyah Rogan at Mining.com.au
Images: NexGen Energy
