Claire Svircas -- MINING NEWS -- Thursday, 2 April 2009
ALLIANCE Resources has increased its financial contribution to the first stage mining area development at the Four Mile uranium joint venture in South Australia to $A2.24 million, but the parties remain at loggerheads as scoping studies miss deadlines.
The latest payment of $800,000 preserves Alliance’s participatory rights in the Four Mile project.
Alliance holds a 25% stake in the joint venture, with the remaining 75% held by Quasar Resources.
In September 2008, Quasar notified Alliance of its decision to mine and provided a feasibility study which forecast production to start in January 2010 at a projected rate of 2.6 million pounds uranium per annum, increasing to 3Mlbpa in three months.
Alliance was required to make a $1 million payment to reserve all of its participatory rights in the project. The company has strongly disputed the validity of the payment.
Alliance claims the feasibility study provided by Quasar was generated internally, and did not provide sufficient independently verified information for Alliance as a publicly listed company and commissioned independent studies at its own cost.
Alliance commissioned independent consultants in December 2008 and began its own resource estimate in early January 2009.
The resource estimate is still to be finalised due to delays in receiving final drilling information from Quasar.
An initial resource estimate for Four Mile East is expected in May 2009 and an expanded initial resource estimate for Four Mile West is due in June.
Alliance also commissioned an independent scoping study for the Four Mile project to determine capital and operating cost estimates for comparison to those already presented by Quasar.
Quasar estimated the project development costs to be $90 million, with Alliance’s share amounting to $22.5 million.
It also estimated total operating costs of $A38.8 per pound uranium.
The scoping study was due to be completed in the first quarter of 2009, however the launch was delayed due to issues raised by Quasar over control of confidential information.
A completion date for the scoping study is now targeted for June-July.
Shares in Alliance Resources were unchanged in trading at 56c.
AGS Price at posting:
52.9¢ Sentiment: Hold Disclosure: Held
