GoviEx Announces Drill Program on Mutanga Project, Zambia
Vancouver, May 28, 2021 - GoviEx Uranium Inc. (TSXV: GXU) (OTCQB: GVXXF) ("GoviEx or the Company") is pleased to announce that it has executed a drilling contract with Hydro Tech Drilling & Exploration (Z) LTD ("Hydro Tech") to undertake exploration and resource delineation drilling programs focused at the Company's Mutanga Uranium Project, in Zambia (the "Project").
"With the reissued Chirundu Mining Permit we are keen to get back to advancing our Zambian assets with the development of Mutanga. The Project benefits from very simple and straight forward operations due to low-waste stripping, low acid consumption and potentially one of the lowest capital expenditure requirements of its African peers needed to get into production. The mine plan currently forecasts an 11-year mine life and the drill targets identified through trenching, in known uranium intersections, indicate potential for resource extension making this a potential long-life project. Furthermore, considerable metallurgical test work has already been undertaken to a pre-feasibility study standard, providing considerable confidence on the process route considered." stated Daniel Major, Chief Executive Officer.
GoviEx has planned a 8,000 metre down-hole percussion drilling program, focussed on the Dibwe East deposit and new areas defined by previous trench sampling east of Dibwe East. The objectives of the program are:
- To upgrade the mineral resource associated with the Dibwe East deposit from an Inferred to an Indicated category, allowing its inclusion in a Feasibility Study. Drilling will be carried out based on a 100 m x 50 m grid to an average depth of 110 metre. The Dibwe East deposit currently contains 43.1 Mt of ore at an average grade of 304 ppm U3O8 for 28.9 Mlb U3O8.
- To undertake exploration drilling on three trenches on strike and to the east of Dibwe East, which have previously shown anomalous uranium.
Hydro Tech is a Zambian based drilling company that specialises in groundwater and exploration drilling and has been operating for seven years. Terratec Geophysical Services Namibia will provide down-hole logging services including, calibrated gamma log, used to estimate the uranium grade, hole deviation and conductivity log, to interpret the geology.
Image 1 - Dibwe East - 2121 Proposed Drilling
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In addition, the Company will start the installation of water points in the nearby village of Hachibozu, which will include: drilling a water well, installation of a wind pump and a water tank. This is part of the Company's CSR program and aims to help facilitate access to water within the village.
In 2017, the Company filed the "NI 43-101 Technical Report on a Preliminary Economic Assessment of the Mutanga Uranium Project in Zambia", dated November 30, 2017 (the "PEA"). The PEA was prepared by Qualified Persons from SRK Consulting (UK) Limited.
Highlights of the PEA include the following:
- The Project development plan envisions an average annual production rate of 2.4 million pounds of U3O8 yellowcake over an initial 11-year mine life, with an 88% ultimate uranium recovery rate.
- Key benefits of the Project are the low stripping ratio (3.4:1) and low sulfuric acid consumption (3-9 kg/tonne ore).
- Initial capital costs are estimated at US$ 123 million, with estimated cash operating costs of US$ 31.1/lb U3O8, excluding royalties. Total life-of-mine costs are forecast at US$ 37.9/lb U3O8.
- The PEA is based on Measured and Indicated Mineral Resources of 15 million pounds (Mlb) U3O8 and 45 Mlb of Inferred Mineral Resources.
- At a long-term uranium price of US$ 58/lb U3O8, the base case project economics for this Project are positive, and indicate an after-tax net present value of US$ 112 million (at 8% discount rate) with an internal rate of return (IRR) of 25% and total life-of-mine net free cash of US$ 268 million.
The PEA is considered preliminary in nature and includes Inferred Mineral Resources that are considered too speculative geologically to have the economic considerations applied to them that would enable them to be categorized as Mineral Reserves. Mineral Resources that are not Mineral Reserves have not yet demonstrated economic viability. Due to the uncertainty that may be attached to Inferred Mineral Resources, it cannot be assumed that all, or any part of an Inferred Mineral Resource, will be upgraded to an Indicated or Measured Mineral Resource as a result of continued exploration or Mineral Reserves once economic considerations are applied; therefore, there is no certainty that the production profile concluded in the PEA will be realized.
Qualified Persons
The scientific and technical information in this release has been reviewed and approved by
Dr. Rob Bowell, a chartered chemist of the Royal Society of Chemistry, a chartered geologist of the Geological Society of London, and a Fellow of the Institute of Mining, Metallurgy and Materials, who is an independent Qualified Person under the terms of NI 43-101 for uranium deposits. Dr. Bowell has verified the data disclosed in this news release.
Neither the TSX Venture Exchange nor the Investment Industry Regulatory Organization of Canada accepts responsibility for the adequacy or accuracy of this release.
About GoviEx Uranium
GoviEx is a mineral resource company focused on the exploration and development of uranium properties in Africa. GoviEx's principal objective is to become a significant uranium producer through the continued exploration and development of its flagship mine-permitted Madaouela Project in Niger, its mine-permitted Mutanga Project in Zambia, and its multi-element Falea Project in Mali.
Information Contacts
Govind Friedland, Executive Chairman
Daniel Major, Chief Executive Officer
Tel: +1-604-681-5529
Email: info@goviex.com
Web: www.goviex.com
Cautionary Statement Regarding Forward-Looking Statements
This news release may contain forward-looking information within the meaning of applicable securities laws. All information and statements other than statements of current or historical facts contained in this news release are forward-looking information.
Forward-looking statements are subject to various risks and uncertainties concerning the specific factors disclosed here and elsewhere in GoviEx's periodic filings with Canadian securities regulators. When used in this news release, words such as "will", "could", "plan", "estimate", "expect", "intend", "may", "potential", "should," and similar expressions, are forward- looking statements. Information provided in this document is necessarily summarized and may not contain all available material information.
Forward-looking statements include those related to any plans for the further exploration and development of the Project; anticipated low capital expenditure requirements among its African peers needed to get into production; potential for resource extension leading to a potential long-life Project; the stated objectives of the drill program; and the proposed installation of water points in the nearby village of Hachibozu.
Although the Company believes the expectations reflected in such forward-looking statements are based on reasonable assumptions, it can give no assurances that its expectations will be achieved. Such assumptions, which may prove incorrect, include the following: (i) that the Company will be successful in its exploration and development plans for the Project; (ii) that projected low capital expenditures for the Project will remain unchanged or improve; (iii) that the drill program will be completed as planned and meet its objectives; (iv) that the Company will be able to complete its planned CSR work as planned and (v) that the price of uranium will remain sufficiently high and the costs of advancing the Company's mining projects will remain sufficiently low so as to permit GoviEx to implement its business plans in a profitable manner.
Factors that could cause actual results to differ materially from expectations include (i) the inability or unwillingness of Hydro Tech to complete the drill program as and when planned; (ii) the inability of the Company to successfully complete the exploration and development milestones that are the conditions of the reinstatement of the Chirundu Mining License (12634-HQ-LML); (iii) potential delays due to COVID-19 restrictions; (iv) the failure of the Company's projects, for technical, logistical, labour-relations, or other reasons; (v) a decrease in the price of uranium below what is necessary to sustain the Company's operations; (vi) an increase in the Company's operating costs above what is necessary to sustain its operations; (vii) accidents, labour disputes, or the materialization of similar risks; (viii) a deterioration in capital market conditions that prevents the Company from raising the funds it requires on a timely basis; and (ix) generally, the Company's inability to develop and implement a successful business plan for any reason.
In addition, the factors described or referred to in the section entitled "Risks Factors" in the MD&A for the year ended December 31, 2020, of GoviEx, which is available on the SEDAR website at www.sedar.com, should be reviewed in conjunction with the information found in this news release.
Although GoviEx has attempted to identify important factors that could cause actual results, performance, or achievements to differ materially from those contained in the forward- looking statements, there can be other factors that cause results, performance, or achievements not to be as anticipated, estimated, or intended. There can be no assurance that such information will prove to be accurate or that management's expectations or estimates of future developments, circumstances, or results will materialize. As a result of these risks and uncertainties, no assurance can be given that any events anticipated by the forward-looking information in this news release will transpire or occur, or, if any of them do so, what benefits that GoviEx will derive therefrom. Accordingly, readers should not place undue reliance on forward-looking statements. The forward-looking statements in this news release are made as of the date of this news release, and GoviEx disclaims any intention or obligation to update or revise such information, except as required by applicable law.
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