Anfield Energy Reaches Important Milestone with Filing of Preliminary Economic Assessment

Anfield Energy Inc. (TSX.V: AEC) (OTCQB: ANLDF) announced that it has filed its preliminary economic assessment (“PEA”) titled, “The Shootaring Canyon Mill and Velvet-Wood and Slick Rock Uranium Projects, Preliminary Economic Assessment” on SEDAR. The independent PEA was prepared in accordance with National Instrument 43-101 – Standards of Disclosure for Mineral Projects.

The filing of Anfield Energy’s PEA is an important milestone for the company as it progresses towards the restart of the Shootaring Canyon Mill, one of only three permitted uranium mills in the United States. The attractive economics support a follow-up feasability study and fundraising to support construction until the facility comes online after it’s 2 year pre-production period.

PEA Highlights:

  • The PEA indicates: 1) a pre-tax project internal rate of return (“IRR”) of 40% and a net present value (“NPV”) of US$238 million; and 2) a post-tax IRR of 33% and an NPV of $197 million, based on a discount rate of 8% and a uranium price of US$70 per pound, along with a vanadium price of US$12 per pound.
  • Total weighted-average Direct OPEX (i.e., between Velvet-Wood and Slick Rock) estimated at US$244 per ton of mined and processed material.
  • The total cost to produce saleable uranium and vanadium products (i.e. Direct OPEX per ton plus CAPEX per ton) is US$290 per ton, compared to an estimated gross value of US$741 per ton (based on a uranium price of US$70 per pound and a vanadium price of US$12 per pound).
  • Average annual production of approximately 750,000 pounds of uranium and 2.5 million pounds of vanadium per year is estimated over the 15-year mine life.
  • The combined feed of the Velvet-Wood and Slick Rock mines is designed to meet the existing tonnage capacity at Shootaring of 750 tons per day. Additional tonnage capacity would be available after year 8 of the plan.
  • Estimated mill-related capital expenditures at Shootaring, including 25% contingency amount for each item, of: 1) US$31.4 million for general upgrades; 2) US$13.4 million to install a modern vanadium circuit; and 3) US$20 million to update the tailings management facility.
  • Estimated mine-related capital expenditures, including engineering and design, mine facilities, mine equipment, and the reopening of the Velvet decline and the sinking of two production shafts at Slick Rock with a 25% contingency, of: 1) US$15.3 million for Velvet-Wood; and 2) US$27.2 million for Slick Rock.
We are pleased to release the final PEA for the combined Velvet-Wood and Slick Rock uranium and vanadium projects. We believe this robust report underscores the true potential of both Velvet-Wood and Slick Rock within Anfield’s uranium and vanadium production model. Our mine and mill complex continues to take greater shape, and the demonstrated viability of this group of assets confirms our acquisition strategy. We look forward to advancing these assets, and the Shootaring Canyon mill, to reach commercial production.Corey Dias, CEO, Anfield Energy

Shootaring Mill

The Shootaring Mill was licensed and constructed by Plateau Resources and operated in 1982. U.S. Energy and Uranium One were also previous owners of the Shootaring Mill. The mill has not been decommissioned and has been under care and maintenance since cessation of operations. The mill license has been maintained and Anfield is currently conducting engineering and design studies for both the refurbishment of the mill and tailings facility in support of converting the license from its status of care and maintenance to operations.

Velvet-Wood

Between 1979 and 1984, Atlas Minerals mined approximately 400,000 tons of ore from the Velvet Deposit at grades of 0.46% U3O8 and 0.64% V2O5, recovering approximately 4 million pounds of U3O8 and 5 million pounds of V2O5.

The current mineral resources (PEA) of the combined Velvet and Wood historical mines have been estimated to comprise 4.6 million pounds of eU3O8, at a grade of 0.29% eU3O8 (measured and indicated resource), and 552,000 pounds of eU3O8, at a grade of 0.32% U3O8 (inferred resource) with a vanadium-to-uranium ratio of 1.4 to 1.

Surface Stockpiles

In addition to the estimated mineral resource at Velvet-Wood, Anfield controls mineralized stockpiles from past mining at two locations: 1) one stockpile at the Patty Ann mine area near the historic Velvet mine; and 2) several stockpiles near the Shootaring mill. The volumes and uranium content of the stockpiles were estimated from volumetric surveys and sampling conducted by BRS in March, 2015. The PEA includes the stockpiles located near the Shootaring mill only. In total these stockpiles are estimated to contain approximately 77,500 tons of material at an average grade of 0.161% U3O8 and contain approximately 250,000 pounds of uranium.

Slick Rock

Slick Rock is located in the Uravan Uranium Belt region of Colorado. The PEA, 2023 estimates 1.7 million tons containing some 7.7 million pounds eU3O8, with a vanadium to uranium ratio of 6 to 1.

Project Economics

The PEA provides for a two-year pre-production period. The first year’s forecasted capital expenditures of approximately US$24 million include initial mill and mine permitting and licensing, an updated mining and reclamation plan, and initiation of mine development. The second year’s capital expenditures, forecasted at US$88 million (including a 25% contingency), include completion of the construction of mine facilities and purchasing of equipment, and refurbishment of the Shootaring uranium and vanadium mill. Total capital for life of mine is estimated at US$130 million, including sustaining capital.

Total weighted direct operating costs (including mining and handling, haulage and processing, bonding, royalties and taxes) between Velvet-Wood and Slick Rock is estimated at US$244 per ton of mined and processed material. The total direct costs (including direct mine costs and CAPEX cost per ton of processed material) is estimated at US$290 per ton, while the gross value per processed ton of uranium and vanadium at US$70 per pound of uranium and US$12 per pound of vanadium is US$791.

The PEA indicates a pre-tax IRR of 40% at a uranium price of US$70 per pound and US$12 per pound of vanadium. The pre-tax NPV of the project at an 8% discount rate at the aforementioned prices is US$238 million. On a post-tax basis, the resultant IRR is 33% and the NPV is US$197 million.

Anfield Energy is a market awareness client of Capital 10X.

The opinions provided in this article are those of the author and do not constitute investment advice. Readers should assume that the author and/or employees of Capital 10X hold positions in the company or companies mentioned in the article. For more information, please see our Content Disclaimer.

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