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Boss Resources Ltd lifts Honeymoon uranium resource to 53M pounds

Published: 09:30 08 Apr 2016 AEST

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Boss Resources Ltd (ASX:BOE) has delivered its maiden JORC Resource at the Gould’s Dam Project totalling 25.0 million pounds of contained U3O8, located in South Australia, 80 kilometres north-west of Broken Hill.

The initial resource incorporated the results of 937 drill holes. This provides for a lift of 90% in the overall resource inventory at the Honeymoon project to 52.5 million pounds of contained U3O8.

As impressively, this represents a 330% increase in resources since the project was acquired by Boss in December 2015.

As Boss’s Director of Geology Dr Marat Abzalov said, "we have only just started to scratch the surface...and its clear we are dealing in a highly mineralised uranium province.”


Exploration target

The global Exploration Target for Boss’s Honeymoon Uranium Project is currently estimated to be between 42 million pounds and 100 million pounds of contained U3O8 in addition to the current global resource of 52.5 million pounds of contained U3O8.

Extensional and infill drilling throughout the 15 kilometre strike length at Gould’s Dam provides the upside in resource case. Planning is underway for resource drilling at the high-priority Jasons region.
   
Additionally, further opportunity to expand the resource lies within the 50 kilometre plus strike length of the paleo channels in the Western Tenements Project.

The continued resource expansion program will segue into a pre-feasibility study on scope of mine restart in late 2016.


Background on recent acquisition

Boss has been transformed into an advanced uranium developer through the 80% acquisition of the Honeymoon Uranium mine in South Australia.

The acquisition was effectively done at the cost of the $9 million environmental bonds to be paid in staged payments.

The mine, which has been on care and maintenance since 2013, has existing infrastructure and a uranium processing facility which is in excellent condition.

As a result of the purchase, Boss has all the necessary Australian permits to mine, process and export uranium, which is something that only three other mining companies currently hold.


Analysis


Honeymoon is one of the highest grade un-mined uranium resources in Australia, and 1 of 4 fully permitted.

In fact, the resource grade is high when compared to ASX listed peers and ISL uranium projects in Kazakhstan and in the U.S. where less than 500ppm grade is regularly mined.

Boss now has significant resources established on both the eastern and western project regions.

This project has good potential to restart uranium production in the medium term, which will likely be done at an increased scale in order to be sustainable in the current uranium price environment.

The project also uses the In-Situ Leach (ISL) extraction technique which is renowned worldwide for its low operating cost base.

The ability to use the ISL method of recovery at Honeymoon provides a significant cost advantage over other uranium companies that mine hardrock underground or through open pit methods.

Boss has benefitted from the $170 million in capital spent by the previous owners Uranium One (UUU) and Mitsui.

The Honeymoon deposits are at a much shallower depth (100-120m vs 250-600m in Kazakhstan) which means a significant advantage with lower on-going drilling costs. Honeymoon is also higher grade and has a lower acid consumption.

Boss is targeting low CAPEX and cash costs of <$25/lb production.

Boss now has significant resources established on both the eastern and western project regions.

Share price gains have been steady since 2015 with strong price drivers ahead for Boss including:

- Further resource estimation underway.
- Convert exploration target into JORC resources at Goulds Dam Target and Jasons Target.
- Commence exploration Q2 2016 - Targeting known mineralised areas for low cost additional resources.
- Option Study - Commencing a process option study SX, IX, Eluex and expansion options depending on resource size.

 

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