The project has a Net Present Value of US$531.9 million with an internal rate of return of 60% based on a discount rate of 8%.
The Definitive Feasibility Study has reported that over an initial ten year period the project is capable of producing an average of 4.4 million pounds of uranium per year at a cash cost of US$13.30 per pound and a total cash cost of US$15.06 per pound during steady state which compares with the current spot price of US$20 per pound and term contract price of US$41 per pound.
With operating costs almost exclusively in Euros and a revenue stream in US dollars the project is expected to continue to benefit from the effects of deflationary pressures within the EU.
Anglo Pacific Group plc (LON:APF) has a 1% life of mine NSR royalty on the Salamanca uranium project located in Spain and operated by ASX-listed Berkeley Energia Limited (‘Berkeley’). The project consists of four main deposits (Retortillo, Alameda, Zona 7 and Gambuta) and is located in Salamanca Province, Spain, approximately 250km west of Madrid.