NexGen Energy Ltd. [NXE-TSX, NYSE] shares rallied Monday February 22 after the company released positive results of an independent feasibility study on its 100%-owned Rook 1 uranium project in northern Saskatchewan’s Athabasca Basin.
The shares advanced 6.0% or 29 cents to $5.16 on active volume of 2.55 million. The shares are currently trading in a 52-week range of $5.41 and 76 cents.
“The environmental and economic results from the Rook 1 Feasibility Study place the project as one of the leading global resource projects with an elite ESG profile,” said NexGen CEO Leigh Curyer. Today’s delivery of the feasibility study is a significant milestone, which transitions NexGen into the next key stage of advancement,” he said. “Results will be included in the Environmental Assessment and licensing processes which incorporates engagement, consultation, monitoring and data collection since 2013.”
NexGen is developing one of the world’s largest uranium deposits on its Rook 1 property. The company is backed by one of Asia’s wealthiest investors Li-Ka-shing. In June, 2016, CEF Capital Markets Ltd., an affiliate of the Hong Kong based conglomerate CK Hutchison Group, which is chaired by Li Ka-shing, subscribed for US$60 million worth of convertible debentures in NexGen.
NexGen said results of the feasibility study include a mineral reserve and mineral resource update for the basement-hosted Arrow deposit, which is located on the Rook 1 Project.
The feasibility study mine plan, using a 0.30% U3O8 cut-off grade, includes probable mineral reserves consisting of 239.6 million pounds of U3O8 that will be extracted by underground mining in an initial 10.7-year mine life. The mine production schedule envisions an average life of mine rate of 1,207 tonnes/day during steady state production.
Also included in the feasibility study is a first-time declaration of measured mineral resources of 2.18 million tonnes, grading 4.35% U3O8, containing 209.6 million pounds of U3O8. Measured and indicated resources stand at 3.7 million tonnes grading 3.10% U3O8, or 256.7 million pounds of U3O8.
The total pre-production CAPEX for the contemplated underground mine, process plant and supporting infrastructure at Arrow is pegged at $1.3 billion.
Underground workings will be accessed by two shafts, with a production shaft supporting personnel movements, materials, ore, waste and fresh air.