Using a uranium price of US$65/lb, the PEA calculated an impressive pre-tax internal rate of return of 60% and a net present value of $18.9 million.
Completed by BRS Engineering, the PEA envisions the ISR operation will deliver wellfield solutions via pipeline to Uranium One Inc's Christensen Ranch ion-exchange facility for initial processing, following which the loaded resin will then be shipped to the nearby Irigaray Central Processing Plant for final processing.
For a capital outlay of $6.7 million, Charlie is expected to produce uranium at a rate of 297,000lb/y over an undisclosed mine life. However, the PEA made provision for a two-year pre-production period.
The first year's forecasted capex of $1.7 million include initial mine permitting, along with wellfield delineation and a $450,000 contingency.
The second year's capex, forecasted at $5 million (and including a $830,000 contingency) include further permitting, well installation, header-house construction and trunk line construction.
The PEA expects opex to total $20.8 million, bringing the total capex required over the mine life to $27.5 million.
Anfield acquired the Charlie project in March through a deal with privately held Cotter Corporation, which also secured nine past-producing uranium-vanadium properties in Colorado, collectively known as the West Slope project. Anfield also holds the strategically important Shootaring Canyon mill in Utah, which it bought from Uranium One in 2015.
Anfield believes it is well positioned to benefit from the uranium market's future prospects as it continues to advance its plans to create a vertically-integrated uranium entity.
Low-price environment
According to the assessment, Powder River Basin-based Charlie will be able to produce uranium at total operating costs of $23.09/oz, which is about on par with current spot prices trending sideways at about $25/lb. Contract prices are not faring any better and have been stuck at the $31-level for several years now.
"We are extremely pleased with the outcome of this PEA as it underlines both the true potential of the Charlie project and our interest in commencing the process of moving it forward to production," said CEO Corey Dias.
"Anfield continues to add shareholder value to its undervalued story through both asset acquisition and development, and the company's ability to leverage Uranium One's existing processing facilities underscores the attractiveness of this project. The Charlie project, with its favourable capital and operating costs, is a realistic investment opportunity as the uranium price heads higher."
However, industry insiders are less optimistic about uranium's short and medium-term future. Kazakhstan, the world's top producer, recently committed to extend a 20% production cut through at least 2023, while the Western-world's largest producer, Canada's Cameco, has been maintaining some of the world's highest-grade mines on care and maintenance for several years now, with no restart likely in the immediate future.
There remains a glimmer of hope, however, for higher uranium prices in the form of the eagerly anticipated report-back by the US Nuclear Fuel Working Group by October 10. The group was established in July by the Trump administration to look at the entire domestic nuclear fuel cycle.
The president in July vetoed a recommendation by the commerce department to require US power producers to source up to 25% of their uranium from domestic producers, instead creating a working group to review and refine the country's nuclear fuel supply chain. All options are still on the table and import quotas could still be one of the outcomes, which could create a separate domestic price point for US-produced material.
Anfield shares (TSXV:AEC) trading in Toronto have lost 45% of their value in the year to date to C10.5c, giving the junior a market capitalisation of $7.84 million.
