Press Release
January 17, 2023
KELOWNA, BC – FISSION URANIUM CORP. (“Fission” or “the company”) is pleased to announce the results of a Feasibility Study conducted by Tetra Tech Canada Inc. (“Tetra Tech”) and titled “Feasibility Study on the Patterson Lake South Property” (the “FS”) for its PLS property in Canada’s Athabasca Basin region.
These impressive FS results further enhance the robust economics outlined in the 2019 pre-feasibility study (the “PFS”). Highlights include a longer mine life of 10 years, greatly increased after-tax NPV of $1.204B at 8% discount, higher after-tax IRR of 27.2% while still maintaining a very low OPEX of $13.02 /lb. All currency figures are expressed in Canadian dollars unless denoted otherwise. The exchange rate used is 0.75 US$ / C$1.00 . Of additional note, initial CAPEX is marginally lower (~2%) than the PFS for a total of $1.155B – a remarkable achievement given current global inflation. The results confirm the economic strength of the PLS project as well as its minimal environmental footprint. With nuclear energy and the uranium sector strengthening year on year, Fission is ideally positioned to continue developing PLS through the environmental assessment and licensing phase. The FS has an effective date of January 17, 2023 .
Ross McElroy , President and CEO of Fission, commented, ” With greatly enhanced economics, including an increase of 42% to the mine life, an incredible 71.5% increase in post-tax NPV and a 10.2% growth in post-tax IRR, this feasibility study confirms the Tier 1 PLS project as one of the most economically significant and elite uranium development projects in the world. Showing CAPEX to be lower than in the 2019 Prefeasibility report, particularly with the pressures of high global inflation, is a remarkable achievement and speaks volumes regarding the team’s design and planning abilities. Beyond the economics, the shallow, high-grade nature of our deposit gives us a very small environmental footprint – an advantage that we have built on with comprehensive monitoring since the start of drilling in 2012 and increasing Indigenous engagement. Going forward, thanks to the strength of this feasibility study and the success of our ongoing social engagement, we will continue advancing through the Environmental Assessment and on towards a construction decision .”
Feasibility Study Highlights
Scope for Resource Growth
While the FS only considers Indicated Resources from the R780E, R840W and R00E zones, the mine plan has been deliberately designed to easily accommodate additional material from the R1515W and R1620E zones based on the potential future conversion of Inferred Resources to Indicated Resources. The majority of mineralization at these two on-strike, high-grade zones is currently defined as Inferred Mineral Resource classification and thus not considered for inclusion in the FS mine plan. As proven by the Company’s drilling at the Triple R deposit’s R780E, R840W and R00E zones, Fission has an excellent track record of converting Inferred-category resources to Indicated-category. As a result, there is a clear path for growing the deposit, potentially leading to an increased resource as well as a longer mine life.
Reduced Environmental Impact
Technical Summary
Overview
The FS was prepared by independent consultants led by Tetra Tech, who carried out the process and infrastructure design, capital cost and operating cost summary, financial analysis and overall compilation, assisted by SLR Consulting ( Canada ) Ltd. (resource estimation), Mining Plus Canada Consulting Ltd. (mineral reserve estimation, mining design, mining infrastructure, mining capital and operating costs), Clifton Engineering Group Ltd. (environment, permitting, socio-economics and tailings), and BGC Engineering Inc. (geotechnical and hydrogeological aspects).
In addition to managing radiological issues common to uranium mining, key technical challenges to developing the operation will be 1) accessing the deposit through the saturated sandy overburden and 2) recovery of the crown pillar reserves using artificial ground freezing techniques.
To access the deposit, a decline is planned through the dewatered overburden using a tunnel shield method and a hydrostatic segmental concrete tunnel liner, a common technique for developing through soft ground. In addition to the decline, two vertical shafts will be developed to provide a dedicated ventilation system for the mine and secondary egress. The crown pillar will be partially recovered with the installation of an artificial ground freezing system, using holes drilled from offset underground drifts below the crown pillar zones. Once the holes are drilled, a refrigerated brine solution is pumped through the holes to freeze the ground, providing ground improvement and reducing the permeability of the rock.
Mineral Resources
The updated Mineral Resource estimate used as the basis for the FS was previously disclosed by Fission in a press release dated September 12, 2022 . The FS Mineral Resource estimate is shown in Table 1.
Table 1: Mineral Resource Statement by Zone – May 17, 2022
Zone |
Tonnes |
Metal Grade |
Contained Metal |
||
(‘000 t) |
(% U3O8) |
(g/t Au) |
(M lbs U3O8) |
(‘000 oz Au) |
|
|
|
|
|
|
|
Indicated |
|
|
|
|
|
R780E |
2,170 |
2.03 |
0.67 |
97.0 |
46.9 |
R00E |
98 |
1.50 |
0.15 |
3.2 |
0.5 |
R1620E |
42 |
1.98 |
0.19 |
1.9 |
0.3 |
R840W |
312 |
1.63 |
0.42 |
11.2 |
4.2 |
R1515W |
67 |
1.15 |
0.38 |
1.7 |
0.8 |
Total Indicated |
2,688 |
1.94 |
0.61 |
114.9 |
52.7 |
|
|
|
|
|
|
Inferred |
|
|
|
|
|
R780E |
271 |
0.60 |
0.46 |
3.6 |
4.0 |
R00E |
9 |
3.83 |
0.79 |
0.7 |
0.2 |
R1620E |
59 |
3.55 |
0.48 |
4.6 |
0.9 |
R840W |
63 |
1.10 |
0.37 |
1.5 |
0.7 |
R1515W |
234 |
0.96 |
0.42 |
5.0 |
3.1 |
Total Inferred |
635 |
1.10 |
0.44 |
15.4 |
9.0 |
Notes:
Mineral Reserves
An updated estimate of Mineral Reserves for the Project was carried out by Mining Plus based on the underground mine plan that captures the majority of the High-Grade Indicated Resources in the R780E, R840W and R00E zones. The FS supersedes all previous mine plans and Mineral Reserve statements. The Mineral Reserves are summarized in Table 2.
Table 2: Mineral Reserve Statement – January 17, 2023
Classification |
Tonnes |
Grade |
Contained Metal |
(‘000 t) |
(% U3O8) |
(M lbs U3O8) |
|
Probable Reserves |
3,007 |
1.41 |
93.7 |
Notes:
Mining
The FS is based on accessing the deposit using a decline developed from a position southwest of the deposits in close proximity to the processing plant and waste stockpile areas. The area of the decline is temporarily dewatered while the development progresses through the overburden. The decline excavation is planned to use a tunnel shield method utilizing a hydrostatic segmental concrete liner for ground support. In addition to the decline, two vertical shafts are excavated sequentially to provide a dedicated ventilation system for the mine (one fresh air intake shaft and one exhaust air shaft). After the decline extends through the overburden and transition bedrock zone, more typical hardrock development can commence. Mining uses the Longhole Stoping method in a longitudinal retreat orientation with Cemented Rock Fill as backfill.
A partial recovery of the mineralized material approaching the contact between the overburden and bedrock is achieved by utilizing artificial ground freezing to achieve a bulk freeze. The ground is frozen by way of drilling holes into the overburden and shallow bedrock using underground drilling collared from a dedicated freeze drift below the crown area. Upon completion of the ground freezing holes, a refrigeration plant pumps a chilled brine solution through the holes to create a frozen cap to provide increased ground stability and reduced groundwater inflow. Once frozen, a low disturbance Drift and Fill mining method with Cemented Hydraulic Fill is utilized to extract the mineralized material. Roadheader tunnelling equipment will be used in the crown pillar areas to remove the need for explosives. A portion of the Mineral Resources approaching the overburden contact will be sterilized due to geotechnical constraints; however, this sterilized material could be further evaluated for eventual extraction in future analysis.
Processing
Tetra Tech completed the design for the process plant and related infrastructure facilities for this FS using proven uranium extraction technology, processes and equipment and has drawn on its knowledge of other Athabasca uranium plants, including Rabbit Lake , Key Lake, and McClean Lake . The processing plant has been designed to process ore at a nominal throughput of 1,000 t/d to produce market-grade uranium concentrate. The average LOM mill feed grade will be 1.41% U 3 O 8 , and the anticipated U 3 O 8 recovery will be 97.0%.
A conventional grinding and leaching circuit will be used for the recovery process. The ore will be trucked from the mine to the ROM pad and ground in a single-stage semi-autogenous grinding circuit to 150 µm. The ground ore will be leached using sulfuric acid and hydrogen peroxide at 50°C. The leached slurry will be fed to a counter-current decantation circuit followed by a clarification stage to produce the pregnant leach solution. A solvent extraction (SX) circuit will purify and concentrate uranium in the solution for yellowcake precipitation. The precipitated yellowcake will be calcined at 450°C before packaging in drums.
Tailings will be neutralized and deposited in the Tailings Management Facility. The TMF utilizes the previous surround design method of tailings management, a common method used in uranium mines in northern Saskatchewan . Effluent and contact water will be treated, monitored, and sampled before being discharged.
Infrastructure
The major components of infrastructure include:
The general arrangement of the site infrastructure is provided in Figure 1.
Financial Summary
Revenue
Operating Costs
A summary of operating costs is shown in Table 3.
Table 3: Summary of Operating Costs
Description | LOM Cost | Average Annual | Unit Cost | Unit Cost |
(C$ millions) | (C$ millions) | (C$/t proc) | (C$/lb U 3 O 8 ) | |
Mining | 458.8 | 45.9 | 153 | 5.05 |
Processing | 489.6 | 49.0 | 163 | 5.39 |
General and Administration | 234.9 | 23.5 | 78 | 2.59 |
Total | 1,183.3 | 118.3 | 393 | 13.02 |
Capital Costs
A summary of capital costs is shown in Table 4.
Table 4: Summary of Capital Costs
Capital Cost Area | Value |
(C$ millions) | |
Mining | 176 |
Processing | 141 |
Infrastructure | 159 |
Tailings Management Facility | 235 |
Direct Costs | 711 |
Indirect Costs | 198 |
Owner’s Costs | 109 |
Contingency | 137 |
Total Initial Capital Cost | 1,155 |
Sustaining Capital | 384 |
Total LOM Capital Cost | 1,539 |
Taxes and Royalties Paid to the Government
A summary of taxes and royalties paid to provincial and federal governments is shown in Table 5.
Table 5: Summary of Taxes and Royalties
Parameter | Value |
(C$ millions) | |
Provincial revenue royalties | 571 |
Provincial profit royalties | 728 |
Corporate income tax | 992 |
Total taxes and royalties paid | 2,291 |
Economic Results
Pre-tax and post-tax economic results are summarized in Table 6.
Table 6: Summary of Economic Results
Parameter | Units | Pre-Tax | Post-Tax |
Cash Flow | C$ millions | 4,508 | 2,787 |
Payback Period | yrs. | 2.3 | 2.6 |
IRR | % | 35.5 % | 27.2 % |
NPV @ 8% discount | C$ millions | 2,095 | 1,204 |
PLS Mineralized Trend & Triple R Deposit Summary
Uranium mineralization of the Triple R deposit at PLS occurs within the Patterson Lake Conductive Corridor and has been traced by core drilling over ~3.18 km of east-west strike length in five separated mineralized “zones”, which collectively make up the Triple R deposit. From west to east, these zones are R1515W, R840W, R00E, R780E and R1620E. Through successful exploration programs completed to date, Triple R has evolved into a large, near-surface, basement-hosted, structurally controlled high-grade uranium deposit. The discovery hole was announced on November 05, 2012 , with drill hole PLS12-022 from what is now referred to as the R00E zone.
The R1515W, R840W and R00E zones make up the western region of the Triple R deposit and are located on land, where overburden thickness is generally between 55 m to 100 m . R1515W is the westernmost of the zones and is drill defined to ~90 m in strike length, ~68 m across strike and ~220 m vertical and where mineralization remains open in several directions. R840W is located ~515 m to the east along the strike of R1515W and has a drill-defined strike length of ~430 m. R00E is located ~485 m to the east along strike of R840W and is drill defined to ~115 m in strike length. The R780E and R1620E zones make up the eastern region of the Triple R deposit. Both zones are located beneath Patterson Lake, where water depth is generally less than six metres, and overburden thickness is generally about 50 m . R780E is located ~225 m to the east of R00E and has a drill-defined strike length of ~945 m. R1620E is located ~210 m along strike to the east of R780E and is drill defined to ~185 m in strike length.
Mineralization along the Patterson Lake Corridor trend remains prospective along strike in both the western and eastern directions. Basement rocks within the mineralized trend are identified primarily as mafic volcanic rocks with varying degrees of alteration. Mineralization is both located within and associated with mafic volcanic intrusives with varying degrees of silicification, metasomatic mineral assemblages and hydrothermal graphite. The graphitic sequences are associated with the PL-3B basement Electro-Magnetic (EM) conductor.
Patterson Lake South Property
The 31,039-hectare PLS project is 100% owned and operated by Fission Uranium Corp. PLS is accessible by road with primary access from all-weather Highway 955, which runs north to the former Cluff Lake mine.
About Fission Uranium Corp.
Fission Uranium Corp. is a Canadian-based resource company specializing in the strategic exploration and development of the Patterson Lake South uranium property – host to the class-leading Triple R uranium deposit – and is headquartered in Kelowna, British Columbia . Fission’s common shares are listed on the TSX Exchange under the symbol “FCU” and trade on the OTCQX marketplace in the U.S. under the symbol “FCUUF.”
ON BEHALF OF THE BOARD
“Ross McElroy”
____________________________
Ross McElroy , President and CEO
IBF4
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