Initial trials at Alligator Energy's Samphire in-situ uranium recovery project demonstrate high recovery rates, exceeding expectations for flow rates and grade, positioning it as a potential sixth ISR development in Australia.
Initial trials at Alligator Energy 's Samphire in-situ recovery ( ISR ) uranium project in South Australia are demonstrating highly encouraging results, potentially paving the way for Australia's sixth ISR uranium development.
The project, located outside Whyalla, has achieved a 70% recovery rate in the initial well field, exceeding expectations and aligning with target parameters. This success is further underscored by flow rates reaching five litres per second during pump testing of the extractor well, significantly higher than the typical 0.5-3Lps observed in other ISR operations.
Moreover, the uranium grade measured at 115 parts per million (ppm), peaking at 250ppm, falls within the upper range of 70-120ppm commonly seen in ISR developments and surpasses the anticipated 110ppm. Importantly, reagent consumption, a critical cost factor, is tracking as expected with minimal losses, indicating efficient operational performance. These early indicators suggest the ISR process is well-suited to the paleochannel system, benefiting from good permeability that facilitates fluid movement within the initial well pattern.
There is currently no evidence to suggest that the saline groundwater is negatively impacting uranium recoveries. The next phase of the trial will deliberately target a lower grade and less permeable area at the margins of the Samphire system. This strategic approach aims to assess the project's performance under more challenging conditions, with anticipated lower flow rates and a potentially longer timeframe for evaluating recovery performance.
Alligator Energy's managing director, Andrea Marsland-Smith, emphasized the importance of comprehensively understanding the hydrogeological characteristics and recovery potential of Samphire to support a robust and bankable feasibility study. She highlighted that the positive initial results are particularly encouraging as the company works to mitigate risks and advance the development of this potentially significant uranium resource.
The achievement of the 70% recovery target within the allocated timeframe validates the scientific basis of the project's assumptions and the operational expertise of the team. The company is keenly aware of the potential challenges inherent in ISR projects, drawing lessons from experiences of other operators in South Australia and the United States.
For instance, Boss Energy encountered unexpected complexities with its well field modelling due to the discontinuous and less leachable nature of its high-grade mineralisation, while Peninsula Energy has addressed ramp-up issues at its Lance project, including lower-than-expected flow rates and gas entrapment. Alligator Energy has proactively identified and developed solutions for potential issues, such as calcium saturation in the groundwater leading to gypsum precipitation and minor scaling.
These issues can be effectively addressed through standard mitigation strategies and incorporated into the full field development plan. The current four-month trial commenced with pre-conditioning in late March, utilizing a pilot plant constructed at the Blackbush deposit, which boasts a grading of 754ppm and contains 12.9 million pounds of uranium. A 2023 scoping study for Blackbush estimated pre-production capital costs of A$131 million and projected the recovery of 12.3 million pounds of uranium over a 12-year period.
Alligator Energy's post-tax net present value is estimated at $275 million, with an internal rate of return of 42%, based on a uranium price of US$75 per pound – slightly below current spot prices. The company is also focused on defining a maiden resource for the nearby Plumbush deposit, located along the same 65km paleochannel, which has an exploration target of 14-75 million pounds at 390-903ppm. A bankable feasibility study is targeted for completion in early 2027.
Alligator Energy's shares remained stable today at 4.1 cents, resulting in a market capitalization of $196 million. The stock has fluctuated between 1.9 cents and 5.6 cents over the past year
Alligator Energy Samphire ISR Uranium South Australia Recovery Rate Flow Rate Grade Blackbush Plumbush Paleochannel
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