Toro Energy, the company vying to develop Western Australia’s first uranium mine, have purchased another uranium project just 90km away, signalling the opportunity for expansion.
Toro Energy today announced plans to buy the Lake Maitland Project from Canada’s Mega uranium for 414 million Toro shares.
The terms of the deal will see Mega emerge as a 28% shareholder of Toro.
The deal will also see Toro’s resource base in the region boosted by 42 per cent, enough for a project of at least 20 years.
Toro’s Wiluna mine is set to become Western Australia’s first ever uranium producer with the company previously stating that if financing arrangements go to plan the mine will be in production by the end of 2015.
Toro managing director Dr. Vanessa Guthrie said the new association with Mega would further boost the company’s credentials in its ongoing negotiations on project financing and offtake agreements.
“The deal puts Toro not only at the forefront of Australia’s new uranium development sector at a time there will be a supply squeeze from 2015 onwards, but adds bench strength to our share register and our project development endeavours through the strategic relationship with Mega,” Guthrie said.
“Specifically, the Lake Maitland acquisition is a transformative deal for Toro and will further enhance the investment case for a prospective partner.”
Guthrie said the acquisition will bring together larger resources, higher volume and grade throughputs and a longer mining life for Wiluna at a time when global demand for uranium is set to outstrip supply.
“Our plan will be to eventually integrate both projects,” she said.
Guthrie said the resource increase gave Toro the option to expand the processing scale of Wiluna above 1.3 Mtpa.
As part of the deal Toro are set to acquire eight exploration licences, two exploration licence applications, three prospecting licences and a granted mining lease.
Guthrie stressed that Toro’s priority remained the immediate financing, development and commissioning of the Wiluna mine.
Toro has also acquired the Firestake, Dawson, Hinkler, Millipede and Nowthanna uranium deposits surrounding Wiluna in recent years but any plans to expand Wiluna mine would be subject to full open assessments.