Africa-Press – Namibia. Lazarus Amukeshe and Regina Murphy
LANGER Heinrich uranium mine owner Paladin Energy has announced Duke Energy, a leading Fortune 150 North American power utility, as an offtaker once operations at the mine resume.
The American company and a Chinese offtaker, through the mine’s other owners, will scoop up uranium as the world attempts to switch to nuclear power.
Acording to an investor presentation made by the company, Paladin is also planning a low-risk restart of the Langer Heinrich Uranium mine, with a project capital forecast of US$118 million (N$2,1 billion) in early 2023.
Paladin Energy owns a 75% stake in the Langer Heinrich mine, while the Chinese National Nuclear Corporation (CNNC) owns 25%.
CNNC acquired the 25% stake in 2014 for US$190 million before the mine went into care and maintenance in 2018.
In a recent statement, Paladin Energy said site contractors and the mine’s personnel have removed redundant equipment in preparation of process upgrades and improved plant maintainability.
The company said the completion of site establishment activities is in preparation of receiving site construction contractors and project equipment and materials.
The offtake agreement means Duke Energy will buy or sell uranium produced at the Langer Heinrich mine for six years, with the option to extend it for three years.
According to a March 2022 ASX announcement, the offtake agreement contemplates the supply of up to 2,1 million lbs of U3O8 over six years, starting in 2024.
This represents about 5% of Langer Heinrich’s total production.
In addition to the Duke Energy offtake agreement, Paladin said it has secured four additional tender awards for uranium supply to industry-leading counterparts in the United States (US) and Europe.
The government, however, said the company would have to approve the proposed US and European contracts before execution.
Paladin already has an existing offtake agreement with CNNC Overseas Uranium Holding Limited (CNNC) for up to 25% of the Langer Heinrich future life-of-mine production.
The company said it has renegotiated CNNC payment terms to speed up payment and improve liquidity.
Tax professionals have always cautioned that arrangements between connected parties as with Langer Heinrich and CNNC carry certain tax risks.
Paladin in 2019 was accused of dodging taxes when it sold part of its shareholding to CNNC, which the Namibia Revenue Agency was tasked to pursue.
NamPower, Paladin said, confirmed the initial supply and upgrade for power requirements, while NamWater confirmed the availability and supply of water the mine requires.
“[The] Activity for the December quarter will focus on the completion of redundant equipment removal, the contracting of site work packages, including mobilisation and commencement of the multidiscipline repairs and refurbishment scope packages and growth project civils, and the progression of the NamPower and NamWater agreements and infrastructure upgrade works,” the company said.
DIAMONDS
Unrelated, diamond mining major De Beers released its production figures yesterday, showing that overall production for the third quarter increased by 4% to 9,6 million carats, primarily due to the treatment of higher-grade ore at both Orapa (Botswana) and in South Africa, and continued strong performance in Namibia.
Namibia’s production increased by 33% to 0,5 million carats, primarily driven by continued strong performance from the Benguela Gem vessel.
The company said demand for rough diamonds remained steady, with rough diamond sales totalling 9,1 million carats.
While consumer demand for natural diamonds continues to be robust, a deterioration of global economic conditions, reduced consumer spending and continued Chinese Covid-19 lockdowns have the potential to impact the demand for diamond jewellery.
The American company and a Chinese offtaker, through the mine’s other owners, will scoop up uranium as the world attempts to switch to nuclear power.
Acording to an investor presentation made by the company, Paladin is also planning a low-risk restart of the Langer Heinrich Uranium mine, with a project capital forecast of US$118 million (N$2,1 billion) in early 2023.
Paladin Energy owns a 75% stake in the Langer Heinrich mine, while the Chinese National Nuclear Corporation (CNNC) owns 25%.
CNNC acquired the 25% stake in 2014 for US$190 million before the mine went into care and maintenance in 2018.
In a recent statement, Paladin Energy said site contractors and the mine’s personnel have removed redundant equipment in preparation of process upgrades and improved plant maintainability.
The company said the completion of site establishment activities is in preparation of receiving site construction contractors and project equipment and materials.
The offtake agreement means Duke Energy will buy or sell uranium produced at the Langer Heinrich mine for six years, with the option to extend it for three years.
According to a March 2022 ASX announcement, the offtake agreement contemplates the supply of up to 2,1 million lbs of U3O8 over six years, starting in 2024.
This represents about 5% of Langer Heinrich’s total production.
In addition to the Duke Energy offtake agreement, Paladin said it has secured four additional tender awards for uranium supply to industry-leading counterparts in the United States (US) and Europe.
The government, however, said the company would have to approve the proposed US and European contracts before execution.
Paladin already has an existing offtake agreement with CNNC Overseas Uranium Holding Limited (CNNC) for up to 25% of the Langer Heinrich future life-of-mine production.
The company said it has renegotiated CNNC payment terms to speed up payment and improve liquidity.
Tax professionals have always cautioned that arrangements between connected parties as with Langer Heinrich and CNNC carry certain tax risks.
Paladin in 2019 was accused of dodging taxes when it sold part of its shareholding to CNNC, which the Namibia Revenue Agency was tasked to pursue.
NamPower, Paladin said, confirmed the initial supply and upgrade for power requirements, while NamWater confirmed the availability and supply of water the mine requires.
“[The] Activity for the December quarter will focus on the completion of redundant equipment removal, the contracting of site work packages, including mobilisation and commencement of the multidiscipline repairs and refurbishment scope packages and growth project civils, and the progression of the NamPower and NamWater agreements and infrastructure upgrade works,” the company said.
DIAMONDS
Unrelated, diamond mining major De Beers released its production figures yesterday, showing that overall production for the third quarter increased by 4% to 9,6 million carats, primarily due to the treatment of higher-grade ore at both Orapa (Botswana) and in South Africa, and continued strong performance in Namibia.
Namibia’s production increased by 33% to 0,5 million carats, primarily driven by continued strong performance from the Benguela Gem vessel.
The company said demand for rough diamonds remained steady, with rough diamond sales totalling 9,1 million carats.
While consumer demand for natural diamonds continues to be robust, a deterioration of global economic conditions, reduced consumer spending and continued Chinese Covid-19 lockdowns have the potential to impact the demand for diamond jewellery.
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