Bannerman to finish feasibility study on Etango in 2011

2011-01-28 06:08 ET - News Release

Mr. Len Jubber reports

BANNERMAN RESOURCES QUARTERLY ACTIVITIES REPORT FOR PERIOD ENDING DECEMBER 2010

Bannerman Resources Ltd. has released highlights from the company's quarterly report. The complete report is available on the company website and on SEDAR.

During the December, 2010, quarter, Bannerman Resources Ltd. produced a comprehensive update to the feasibility study on its 80-per-cent-owned Etango project in Namibia, one of the world's largest undeveloped uranium projects, and successfully completed a $15-million (Australian) equity capital raising primarily to a range of key existing and new institutional investors. Bannerman is now well positioned to aggressively pursue development of Etango, one of the world's largest undeveloped uranium projects, and to grow its mineral resource base through exploration activities on its highly prospective landholdings in the vicinity of the Etango project. Given the scale of Etango, Bannerman offers shareholders substantial investment exposure to the rapidly improving fundamentals of the uranium industry.

Highlights

• Resource expansion -- measured and indicated resources increased 5 per cent to 149 million pounds U3O8, and inferred resources increased more than 200 per cent to 64 million pounds U3O8.
• Etango project feasibility -- the study update indicates average annual production of five million to seven million pounds U3O8 per year over a more than 20-year mine life at an estimated average life-of-mine cash cost of $42 (U.S.) per pound:
  • A simple heap leaching processing flowsheet has been selected, featuring rapid and uniform leaching across the deposit, low acid consumption and consistently high (more than 90-per-cent) laboratory uranium recoveries.
  • Capital costs of $638-million (U.S.), before mining fleet and working capital but including a $60-million (U.S.) accuracy provision and an allowance for the proportional cost of constructing a water desalination plant and associated piping infrastructure.
• Exploration upside -- exploration drilling activities in the northern area of the Etango licence area are planned for the March, 2011, quarter. Focus areas include Rossingberg, Cheetah and Ombepo where radon cup and subsequent ground radiometric surveys last year identified key target anomalies.
• Financing secured -- completion of the $15-million (Australian) share placement financing increasing cash reserves at quarter end to $22.7-million (Australian) (Sept. 30, 2010: $12.1-million (Australian)). This financing allows the company to aggressively pursue development of the Etango project.
• Uranium market -- the uranium spot price continues its recent upward trend and is now at $70 (U.S.) per pound U3O8 compared with $47.50 (U.S.) per pound U3O8 at the end of the September, 2010, quarter.
• Key objectives for 2011 -- Bannerman's key business objectives for 2011 are to complete a definitive feasibility study on the Etango project, to test a range of Bannerman's prospective regional exploration targets, to secure a development partner and to obtain the grant of the Etango mining licence.

Bannerman's chief executive officer, Len Jubber, said, "Bannerman is extremely well positioned to pursue development of the Etango project, with the focus in early 2011 on increasing the existing 60-per-cent utilization of the mineral resource base, examining various throughput and materials handling opportunities to reduce operating costs, and the commencement of drilling on promising exploration targets near to the existing project location."

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