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Bannerman Resources test results reveal more cost reduction potential at Etango

The full results from this membrane study are expected early next year.
share price graph concept going upwards
The recent suspension of uranium mines has changed the commodity's price outlook

Bannerman Resources Ltd (ASX:BMN) has successfully completed the initial test work phase of the membrane study for its proposed Etango Uranium Mine located in Namibia.

Early results have validated the potential for further capital and operating cost reductions, to be confirmed in the definitive feasibility study (DFS) update underway.

The membrane study initial test work was conducted on-site at the Etango heap leach demonstration plant.

Brandon Munro, chief executive, said: “This now well-established technology has the potential to move the dial at Etango, so we eagerly await the results from this study, expected early next year."

WATCH: Bannerman Resources well positioned for uranium price recovery

Last month, Bannerman released its Etango processing optimisation study results, which reported a substantial decrease in estimated capital costs.

The study also reported the potential for significant reductions in operating costs, prompting this membrane study.

READ: Bannerman Resources positions Etango at forefront of the global uranium development pipeline

Bannerman’s timing is proving fortuitous in the context of the global uranium market.

As it continues to optimise Etango as one of the world’s most compelling undeveloped uranium deposits, the commodity’s price is finding support.

Uranium prices have jumped as major mines are taken offline

Last month, uranium giant Cameco Corp (TSE:CCO) suspended operations at its flagship McArthur River uranium mine in Canada.

Furthermore, earlier this week, the world’s largest uranium producer, Kazakhstan’s state-owned KazAtomProm revealed it will cut production by 20% over the next three years.

Commentary from commodities analysts suggests this news can push spot uranium prices to the mid-high US$20 per pound range and perhaps above US$30 per pound.

Chief executive expects supply changes to push market into deficit

Munro also said: “Recent production cut announcements from the world’s two largest uranium producers, KazAtomProm and Cameco, will remove more than 25 million pounds of uranium from 2018 forecast supply.

“This is expected to put the uranium market into deficit, which follows 11 consecutive years of surplus that has driven prices to fundamentally unsustainable levels.

“Next year promises to be very exciting for our industry and Etango is exceptionally well positioned given its advanced nature, world-class scale and the substantial economic uplift we are targeting in the DFS update.”

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