Swakop Uranium, the developer of the N$20 billion Husab Mine, said this week that the mine will continue to ramp up its operations this year, despite the prevailing low commodity prices.
The company said that throughput will be progressively ramped up towards the previously projected target of 15 million pounds (6, 800 tonnes) uranium oxide per year, once in full production, which represents the nameplate capacity of the mine.
Swakop Uranium Chief Executive Officer, Zheng Keping, told the Windhoek Observer that the decision to optimise production was made by the board of directors, after factoring in the prevailing depressed uranium prices, which currently hovers above US$25 per pound of uranium.
“During 2017, the plant will continue to be optimised, and throughput will be progressively ramped up towards the target of nameplate capacity, despite the depressed uranium prices prevailing globally,” Keping said.
“Also, note that Swakop Uranium is still busy ramping up its production, and actual figures, at this stage, cannot be shared for now.
“With regard to safety, no fatalities were recorded in 2016, and only one lost-time injury (LTI) was reported in October 2016, equating to a lost-time injury frequency rate (LTIFR) of 0,33.
“Swakop Uranium was awarded with certificates, in compliance with the international safety, health and environmental standards, in 2016,” Keping added.
He said the mining company had facilitated world-class training programmes for its mining and processing operators, for which Swakop Uranium had spent N$191 million over a two-year period in 2015 and 2016.
“We also have a graduate training programme in place, with about 20 graduates in the fields of mineral resources, mining, processing, engineering and human resources, in order to build a leadership pipeline in Namibia. All 20 graduates are from poor families, and are previously disadvantaged persons.’’
When fully operational, the Husab Mine is projected to contribute between 5 and 6 percent to the total Government income, by paying between N$1,1 and N$1,7 billion per year in corporate tax, and N$220 million per year in royalty payments, while contributing an additional N$7,3 billion or 20 percent to Namibian exports annually.
The majority of the uranium oxide, produced at Husab, will be sold to Swakop Uranium’s majority shareholder, China General Nuclear Power Group (CGN).
CGN is a large, clean energy group, with an installed nuclear capacity of 17,091 Megawatts electric (MWe), representing 59,3 percent of China’s installed nuclear capacity.
It has a further 14,650 MWe under construction, which accounts for 51,7 percent of the capacity being built in China, making it the largest developer of nuclear power in the world.
The depressed uranium prices, which have prevailed since 2011, continue to deal a major blow to the local mining sector, and the country’s economy as a whole, with some uranium miners forced to reduce production or downsize their workforce.
Langer Heinrich, announced plans in October last year to cut production during 2017, citing weak global prices of the commodity.
In October 2016, Paladin Energy announced that it was lowering the production targets for Langer Heinrich in 2017 and 2018, and also signed a non-binding term sheet to sell 24 percent of the mine.