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South Australia set for new uranium mine

South Australia looks set to get a new uranium mine south of Whyalla after positive results from a study by ASX-listed Uranium SA.

The company said in a statement yesterday the study into the likely financial returns from its Blackbush deposit confirmed robust results.

“The figures indicate very favourable capital and operating costs and high potential rates of return on the investment over a range of scenarios,” it said.

The study modelled the Blackbush deposit being developed to produce 600 tonnes of uranium annually at a cost of $75.8 million.

It said the indicated operating cost of the mine would be $25.90 per pound of uranium.

Financial models for 400tpa and 800tpa were also considered.

Currently the spot price market for uranium pays $50.75 a pound and the long-term contract price paid by nuclear power operations is $62.50 a pound.

Uranium SA warned that technical work on the deposit was still and progress and the exact figures of the operation were still to be determined.

However it said capital for the development should be paid back within 42 months.

Uranium SA managing director Russel Bluck said in a statement the results of the study had confirmed Blackbush as a viable project, and the company was now working to develop the site.

“[The results] significantly lower the risk profile of Blackbush, and it is now firmly in the development pipeline towards achieving near-term production of yellowcake,” he said.

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