black range minerals books earlier cash flow

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Black Range Minerals books earlier cash flow potential with Ablation uranium technology
Friday, July 06, 2012
by Bevis Yeo


Black Range Minerals (ASX: BLR) has formed a joint venture with Ablation Technologies’ to market the latter’s ore concentration technology that has been successfully tested at the Hansen / Taylor Ranch Uranium Project.

Key takeaway is that by adopting Ablation Technologies' process has successfully removed the uranium mineralised patina from the Echo Park sandstone grains at Hansen to produce a high grade, high value concentrate containing some 95% of the uranium in about 10% of the original mass.

“Should arrangements for the exploitation of these types of deposits be concluded, BLR may be able to benefit from earlier cash flow as we continue to move our Hansen Project though the permitting process, which is scheduled to be complete near the end of 2015," Black Range Minerals managing director Tony Simpson said.

“The JV brings the project development and operational skills of BLR together with an innovative solution to concentrate uranium ores. This gives us the potential to unlock value not only in the Hansen Project but also in a range of uranium projects.”

Black Range will initially fund 100% of the operating costs to commercialise and apply the process in uranium and associated minerals projects globally and will recover Ablation Technologies’ 50% share from revenues earned.



Ablation process

In the ablation process, ore slurry is ejected from two opposing nozzles to create a high-energy impact zone. Collision of particles within this high-energy impact zone separates the mineralised patina (coating) of uranium from the underlying grain. The uranium bearing particles are recovered in the fine fractions separated in a subsequent screening process.

This allows about 90% of barren material to be separated from mineralised material prior to milling, greatly reducing the operating and capital costs required to process the highly concentrated ore.

Ablation has also been tested successfully on ore samples from numerous other projects in the U.S.

The process could be the key to unlocking the potential of sub-economic resources which do not have the critical mass required to justify the expense of permitting and building a uranium mill. In these cases, the technology could be used to produce a high-grade concentrate that can be more economically transported to a mill facility.

Black Range has entered into an option agreement to acquire all of the issued capital of Mineral Ablation Inc., a company that held certain prior rights to Ablation, for just over A$1 million.



Hansen

The Hansen project area contains JORC Indicated and Inferred resources of 90.9 million pounds of U3O8, at a grade of 600 ppm, found within 5 separate deposits that are located along a 10 kilometre strike line, the largest uranium deposit in Colorado and the third largest deposit in the U.S.

Black Range has completed a positive Scoping Study at Hansen that utilises low cost borehole and ablation technologies to extract 5.28 million tonnes of ore, and produce 14.05 million pounds of uranium.

The Life of Mine Operating Costs were estimated at a total of $30.01 per pound of produced uranium, that includes wages of $3.07, UBHM operating costs $13.38, ablation operating costs $3.13, material handling $0.19, water treatment $0.12, milling operating costs $8.14, and site wide costs of $1.99 that were prepared to an accuracy of +/- 20% and exclude royalties, taxes and contingency.

Capital Costs were estimated at a total of $141.52 million and include UBHM slurry handling $3.09 million, ablation $34.11 million, material handling $1.91 million, water treatment $12.07 million, site wide costs $7.34 million, engineering and installation $15.00 million, and mill for $68.00 million. Capital costs could be significantly reduced to around $40 million by the separate provision of off-site milling and a BOO agreement for ablation.


Analysis

With an estimated Long Term uranium concentrate price of around $60-$65 per pound, affords Black Range strong projected profit margins.

The Hansen / Taylor Ranch Uranium Project hosts the largest uranium resource in Colorado and the third largest uranium deposit in the U.S.

Also notable, Black Range's Hansen project ranks in the top 10 in: Size of uranium deposit: 7th; grade of uranium: 5th; EV/Pounds valuation: 5th. For all but the keenest of sleuths, the Company is little known but that looks set to change - as it can potentially fast-track to production.

http://www.proactiveinvestors.com.au/companies/news/30986/black-range-minerals-books-earlier-cash-flow-potential-with-ablation-uranium-technology-30986.html




Cheers from G64


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