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MINING | NexGen Energy
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Advancing a major asset in the world’s best uranium deposit
MINING | NexGen Energy
NexGen Energy was formed to address a major structural risk that was forming in global energy markets during the 2000s. This was the fact that the world was seeing uranium production mostly concentrated from within non-OECD nations. NexGen was formed to discover the world’s next tier one uranium asset. What the company ended up finding was better than anything that has been seen in the sector and one that goes a long way to addressing these structural issues in the global energy mix. The company was founded in the 12 months following the Fukushima accident in Japan. The impact of the 2011 disaster was heavy-hitting to the uranium industry, however NexGen viewed the downturn as a rare and opportune moment to acquire 260,000 hectares of land in Canada’s Athabasca Basin – within what the company believes is the world’s best uranium jurisdiction: Saskatchewan. “We were able to acquire the land position for a very good price and if you wanted to do that today, you wouldn’t be able to,” claims Travis McPherson, vice-president, corporate development at NexGen.
Resource Global Network “We took advantage of the negative sentiment towards uranium at that time, knowing that nuclear is a critical, diversifying portion of any countries’ energy mix. “We were very confident in the fundamentals of that commodity and remain so. We have never been as constructive about the supplydemand fundamentals as we are today. Nuclear energy has a very bright future especially as the world focuses on clean reliable energy sources.” NexGen is the largest landholder in the Southwest part of the Athabasca Basin, which represents the future of Canada’s uranium industry according to McPherson and several leading pundits. Within the company’s vast landholding in the Athabasca Basin is its flagship Rook I project, which includes the 100%-owned Arrow Deposit – the jewel in NexGen’s Canadian crown.
Follow the trend “The district is extremely well endowed; our deposit remains open in every direction and that is just one part of a 9 km known mineralised trend that we have on our property.” As part of its ongoing exploration activity at Arrow, NexGen has poked holes in several areas around the strike and everywhere it has looked it has hit more uranium mineralisation. This explains why the company is so convinced that it is located in one of the most endowed mineral belts in the world, across any commodity.
MINING | NexGen Energy
“For us to have the most dominant foothold
in the best uranium district in the world
in this area, straddling the edge of the
due to the professional and transparent
Athabasca Basin, is very strategic. Stradling
stance of the Saskatchewan and Canadian
the Basin boundary is where you want to be
governments, who have a long history and
because, theoretically, that’s where a deposit
deep understanding of uranium mining. “We
would be at its most economic, where the
wouldn’t want to be working anywhere else,”
Basin comes up from the depth and is shown
McPherson enthuses.
at or near surface.” The most notable examples of the provincial NexGen also considers itself to be located
government’s experience in handling major
Resource Global Network
uranium developments comes in the shape
compared to other uranium deposits in the
of Cameco’s McArthur River and Cigar Lake
province and across Canada, the unique
mega-mines, which are currently the world’s
thing about the Arrow Deposit is the fact that
largest and highest-grade uranium mines,
the resource is completely contained within
located in Northern Saskatchewan. According
basement rock with no surface water.
to McPherson, Arrow will potentially propel NexGen into the number one position
“That really is a massive differentiator from
globally.
everything else out there because it means the resource can be mined using traditional
However, McPherson stresses that when
underground methods.”
MINING | NexGen Energy
“We were very confident in the fundamentals of that commodity and remain so. We have never been as constructive about the supply-demand fundamentals as we are today. Nuclear energy has a very bright future especially as the world focuses on clean reliable energy sources.” Travis McPherson, vice president, corporate development
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MINING | NexGen Energy The deposit shares similarities with Canada’s
“Also, because the deposit is completely
high profile uranium mines in terms of scale
vertical we are able to extract almost all of
and grade profile.
the resources with very high recovery rates as confirmed by our recent metallurgical
Furthermore, it is the unique technical setting
results, along with low deleterious elements
of the deposit that is driving the economics
such as arsenic, selenium or antimony.”
seen in the company’s preliminary economic
Mouth-watering economics
assessment (PEA), published in July of last year. “Within the basement rock you are talking about extremely competent, essentially impermeable ground conditions that are very stable,“ explains McPherson. “This means
NexGen’s PEA for the Arrow Deposit revealed a mouth-watering selection of project economics including a post-tax net present value of C$3.5 billion, an after-tax internal rate of return of 57% and a 1.1 year payback period on C$1.2 billion in capital costs.
extraction comes at industry leading low
For a project with an average annual
costs due to the combination of scale, grade
production of 27.6 million pounds of uranium
and technical setting.
(in the first five years) over a 14.4 year mine
Resource Global Network life, the outlined economics are absolutely
“All of these elements combine to produce
unique not just in the uranium space but
one of the most economically powerful
across the entire mining industry, according
mining projects out there irrespective of the
to McPherson.
commodity one is speaking about.”
He goes on to run through a checklist of
During the recent winter months, NexGen
important features that are crucial for any
was engaged in a two-pronged drilling
mining project to be successful:
programme at the Arrow Deposit, the first half of which involved development
“1) Highest quality mining jurisdiction –
activity in the form of geotechnical drilling,
check. 2) No surface of ground water issues
metallurgical and hydro-geological work, as
– check. 3) Working closely in a partnership
well as some environmental baseline and
approach with the local communities – check.
community relations activity.
4) uranium specific advantages (high grades and large tonnages, basement hosted, low
The other half of the winter drill programme
delirious elements) – check.
has been called exploration drilling by the company, although McPherson explains that
MINING | NexGen Energy
the actual purpose of the undertaking was
drilling partners to transportation, while also
to understand and test the global context of
dipping into the highly-skilled employment
Arrow.
market.
Nonetheless, the assay results confirmed
“We are continuing to look at and develop
uranium mineralisation in aggressive step
our supply chain into the local areas.
outs to the Northeast of the deposit and also
We want to use suppliers that may be in
along strike. “This summer we are following
Saskatoon or other parts of Saskatchewan
up on these new zones.
and help them develop into locally-focused businesses in order to supply our projects.
“Again, the idea is not to delineate another 10 million pounds of resources per say, but to
“We’re also working with the communities
understand if there is another Arrow sitting
in the areas of health, education and
there.”
workforce development in order for everyone to be involved in the tremendous
During the winter drill programme and throughout its time in the Athabasca Basin,
opportunity in front of us all.”
NexGen has been able to call upon a plethora
A packed pipeline
of local goods and services companies, from
Following the completion of the summer
ResourceGlobal GlobalNetwork Network Resource
drill programme at Arrow, NexGen will gear
strained supply as several major global
up for the release of its maiden pre-feasibility deposits reach depletion, the importance of study for the project, which will include an
NexGen’s high-grade Arrow Deposit comes
updated mineral resource estimate.
sharply into focus.
The PFS is due in early Q4 of this year and will The company is confident that nuclear be followed up by initiating the permitting
energy is on the rise once again and is aiming
process shortly thereafter. In 2019, the
to supply the industry with the world’s
company will continue expansion and
highest quality uranium from the world’s
definition drilling to support the feasibility
best uranium project in the world’s best
study as well as continuing the permitting
mining jurisdiction - the Athabasca Basin,
process for the project.
Saskatchewan.
With demand for uranium steadily increasing against a backdrop of concentrated and
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Published by Anderson Murray Media Ltd
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