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Berkeley Energia asked to tender for Asian supply contract

Friday, November 4, 2016 0:41
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Berkeley Energia PLC (LON:BKY) said it had been asked to tender for a ten-year, 11mln pound contract to supply uranium from its Salamanca mine in Spain.

The operation should start producing late next year, subject to funding.

The invitation from an unnamed Asian utility reveals the interest there is in the only uranium project in the world currently under construction.

Berkeley also said that a number of major utility companies from both the US and Asia have expressed interest in taking some of Salamanca’s output.

In fact they have undertaken due diligence and visited the site.

The update was given in the company’s quarterly report, which revealed that a scheme to train up local workers ahead of employment at the mine had been significantly oversubscribed.

“We are extremely encouraged by the strong local support for the development of the mine and in return we remain absolutely committed to rejuvenating the local community, bringing badly needed jobs, training and new business activity to the area,” said chief executive Paul Atherley.

“After a decade of investment we are bringing the Salamanca mine into production at the bottom of the uranium price cycle and judging by the interest we are receiving for offtake from 2018 onwards in particular from US and Asian utilities it looks like we will be delivering into growing demand.”

Salamanca is one of the lowest cost producers in the world and development is already underway.

The capital investment required to get it up and running is put at just under US$100mln.

Berkeley said Friday the mine development “has caught the attention of a wide range of industry participants and potential financiers”. At the end of September it was sitting on A$13.4mln of cash, which means it is fully funded for the initial development.

Story by ProactiveInvestors


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