Toro Energy: This thing makes serious money – and yes … it’s uranium!
Toro Energy Executive Chairman Richard Homsany on 3AW, 2GB & 6PR Bulls N' Bears Report
Listen to ASX-listed Toro Energy Executive Chairman Richard Homsany talk to Matt Birney on the Bulls N’ Bears Report about Toro’s uranium scoping study that has now been updated with the latest uranium price … and the numbers are big!
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The recent surge in demand for uranium has prompted Toro Energy to investigate the potential spin out of its portfolio of non-core nickel, gold and base metal assets in WA to level its focus solely on uranium. Encouraged by record prices earlier this year and the increased interest in uranium driven by the global net zero movement, Toro has scrubbed up its 2022 scoping study at its Lake Maitland uranium project in WA with more up-to-date assumptions and the numbers are compelling.
RADIO INTERVIEW - TRANSCRIPT
Matt Birney - Welcome to Bulls N' Bears brought to you today by uranium explorer, Toro Energy
Matt Birney - ASX code: TOE
Matt Birney - I'm Matt Birney and I'm joined now by the Executive Chairman of Toro Energy, Richard Homsany
Matt Birney - Hi Richard
Richard Homsany - Hi Matt
Matt Birney - Okay the recent surge in demand for uranium has prompted Toro Energy to investigate the potential spin out of its portfolio of non-core nickel, gold and base metal assets in WA to focus solely on uranium.
Matt Birney - Encouraged by record prices earlier this year and the increased interest in uranium driven by the global net zero movement, Toro has scrubbed up its 2022 scoping study at its Lake Maitland uranium project in WA with more up-to-date assumptions and I've got to say, the numbers are compelling.
Matt Birney - Okay Richard we'll get into that in a minute but firstly tell me where is your Lake Maitland uranium project and what's the current resource estimate there?
Richard Homsany - It's 700 km northeast of Perth and at Lake Maitland we have 22 million tonnes grading at 545 PPM U308 for a total resource of 26.4 million pounds U308 but the overall resource at Wiluna is 52 million tonnes grading at 548 PPM for a total resource of 62.7 million pounds U308.
Matt Birney - Okay well let's get into that scoping study with some rapid fire questions. Firstly what's the expected mine life of this project?
Richard Homsany - 17 and a half years
Matt Birney - How much money is it going to make a year on average? Let's go with EBITDA.
Richard Homsany - It averages $131.6 million Australian dollars for a total EBITDA over the project of $2.3 billion dollars
Matt Birney - What about a net present value on the project in today's money?
Richard Homsany - Yeah we've upped that by about 35 per cent to $832 million dollars Australian before tax
Matt Birney - What's it going to cost to build?
Richard Homsany - $290 million Australian dollars including contingency
Matt Birney - And what about a pre-tax internal rate of return?
Richard Homsany - 48 per cent
Matt Birney - Now this project has some vandium in it too, what percentage of the revenue will come from vandium?
Richard Homsany - It'll be less than 5 per cent so it's cream on the cake Matt
Matt Birney - Okay let's go back to uranium, how much is uranium selling for a pound right now and how much do you say Toro can produce a pound of uranium for at Lake Maitland?
Richard Homsany - Currently spot prices are around $85, over the life of the project our all-in sustaining cost at Lake Maitland will be $30.55 US per pound and in the first seven years it'll be a very low $22.58 per pound
Matt Birney - Now your previous scoping study on this project was released back in 2022. What are the key pricing assumptions you've made for this update?
Richard Homsany - We've been conservative and assumed an 8 per cent rise in cost and we've done the model at the current spot price for uranium and it still delivers a windfall gain.
Matt Birney - Richard Homsany from Toro Energy
Matt Birney - Thanks for joining me on Bulls N' Bears and remember we're only here to give you information, not advice, which you should of course seek independently.
Matt Birney - I'm Matt Birney and this is Bulls N' Bears
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