Uranium developer Boss Resources has secured a deal to acquire Wattle Mining, giving it 100 per cent ownership of the Honeymoon project in South Australia.
Privately-owned Wattle holds the 20 per cent stake in Honeymoon not already owned by Boss, which will exchange 300 million of its shares, equal to around $17 million, to make the acquisition.
Honeymoon, about 80km north-west of Broken Hill, includes a mining lease, exploration licences and $170 million of infrastructure currently placed on care and maintenance.
Boss managing director Duncan Craib described the company as one of the few independent uranium projects ready to participate in the early stages of a new bull market in uranium.
“It is truly a product for this time,” Craib said of the project. “Consolidating our ownership of the Honeymoon uranium project is a significant milestone for the company as it advances the project with the aim of becoming Australia’s next uranium producer in excess of 3.2 million pounds (Mlb) U3O8 per annum.
“The company is particularly pleased with the outcome of an equity only transaction rather than a royalty or cash component.”
The depressed global uranium industry received welcome news this week when leading producer, Kazakhstan’s Kazatomprom, said it planned to lower output by 20 per cent over the next three years.
Boss’ development approach for Honeymoon will involve restarting the operation with the existing facilities and constructing the first stage of an ion exchange plant.
Once operations have ramped up and the new process is verified, Boss plans to undertake another ion exchange upgrade.
Craib said the past 12 months had been transformational for Boss as it “overwhelmingly achieved” its restart strategic milestones.
“Final technical confirmation has been provided by the outstanding field leach trial results following the highly successful preliminary feasibility study, and the reported upside in feed tenors achieved from the improved leaching and/or wellfield performance is expected to result in increased efficiency and therefore even lower operating costs,” he said.
“The culmination of these staged development steps can ensure Honeymoon can operate in the lowest cost quartile of competitive global producers.”