Antinuclear

Toro Energy and Mega Uranium making a big mistake in acquiring Lake Maitland

  Toro’s mega mistake Mia Pepper – Conservation Council of WA 12 August 2013 WA uranium hopeful Toro Energy’s acquisition of Lake Maitland, another small calcrete uranium deposit in a sensitive Lake system, is based more on optimism and need rather than any measured assessment of the deeply depressed uranium price and nuclear sector said the CCWA today.

The acquisition between Toro and Mega Uranium does little to change the fundamental constraints facing each company and may well be Toro’s mega mistake.

It is a further sign of the difficulties facing junior uranium companies in a time of falling commodity prices and rising costs. Toro and Mega may share big dreams but they do not have big capacity, experience or dollars.

Toro cannot begin construction at Wiluna and do not have final and formal approval to mine at Wiluna. Instead the company has a conditional Federal approval that involving 35 conditions and requires further assessment from the Federal Minister.

The conditional nature of the approval prohibits Toro Energy from clearing vegetation or using heavy machinery for breaking ground for mining or infrastructure. Toro must also complete a mine closure plan for both State and Federal level assessment.

A recent independent economic analysis of the Wiluna project (attached) found that:

The Wiluna project’s lack of scale and high sensitivity to changes in operating or capital costs means our estimate of its position on the mine production cost curve is perilously high. The project would be highly vulnerable under our model, in the event of sustained lower long-term contract prices in the next decade. On both a cash and total economic cost basis our model suggests Wiluna is a high cost project that will struggle to compete against either existing mines or most greenfield and brownfield projects.     For the full report: http://www.ecolarge.com/work/osos-sobre

August 11, 2013 - Posted by Christina Macpherson | business, uranium, Western Australia