As uranium prices begin to rebound, Paladin Energy (PDN-T, PDN-A) is bulking up resources at its Kayelekera deposit in Malawi. Unfortunately for it, the latest news is being released into a falling market.
Notwithstanding, results from northern Malawi brought a 35% increase in measured and indicated resources and a 17% increase in proven and probable reserves.
Using a cut off grade of .03% U3O8 the project now has measured and indicated resources of 22.2 million tonnes grading .08% U3O8 for a total of 39.1 million lbs of U3O8.
Inferred resources now stand at 3.9 million tonnes grading .06% U3O8 for 4.7 million lbs. U3O8. The upgrade into measured and indicated took most of the inferred resources from the past estimate.
The increase in measured and indicated tonnage, however, did come at the cost of a slight decrease in grade – to .08% U3O8 from the .0886% U3O8 in the prior estimate.
Paladin says this is because the high grade core of the deposit was well defined by previous drilling and the new drilling focused on defining the peripheral, lower grade zones of the deposit.
Proven and probable reserves also got a bump up to 12.62 million tonnes grading .105% U3O8 for 29.3 million lbs. That represents a 17% increased compared with the previous estimate of 25.1 million lbs.
Those bigger resource numbers carried the estimated mine life another 1.5 years to 9 years at a production rate after the first year of 3.3 million lbs. of U3O8 per year.
Paladin also says its 132 reverse circulation drill hole, 9,955 metre drill program also showed more mineral potential. Especially, it says, to the north west and west. It anticipates that the zones could easily add further resources with future drilling.
In Toronto on Nov. 20 – a bad day for the market overall — Paladin shares fell 13% or 23¢ to $1.45 on 1.8 million shares traded.
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