The first drums of uranium produced from the Langer Heinrich Mine (LHM) in March 2024 marked the mine’s return to commercial production—a rebirth that attracted total project expenditure of slightly above N$2.1 billion.
Indeed, the return to commercial production was the culmination of an extensive work package that commenced in July 2022 and focused on the repair, refurbishment, and debottlenecking of the existing LHM plant, which was placed into Care and Maintenance in 2018.
Paladin’s Chief Executive Officer, Ian Purdy, highlights that the miner successfully achieved the commercial production targets set for FY2024 on time and below the restart project and operational readiness budget, and the LHM will continue to ramp up during FY2025.
In the same breath, Purdy also identifies key areas in which Paladin dedicated funding to make the restart project a resounding success.
The key repair & refurbishment work streams delivered to return the LHM to production included: civil/structural improvement works (concrete, steel), mechanical refurbishment works (pumps, pulleys, conveyors, ancillaries), piping & valve refurbishment and replacement works (pipes, valves, racks, mounts), electrical improvement works (uninterrupted power supply units, lighting, plant electrical), and control & instrumentation refurbishment works (repairs, replacement, calibration, and recommissioning of all instruments). Furthermore, debottlenecking upgrades are delivered to derisk production and increase throughput capacity and operational availability of the plant.
On the other hand, improving environmental and sustainability aspects of the plant and operations included: an automated, dustless drumming Final Product Recovery (FPR) plant, Control system upgrade, Addition of leach feed surge tanks, tailings dewatering upgrade, ROM bin upgrades, primary classification cyclone upgrade, pre-leach and CCD feed well upgrade, product thickener improvements, NamWater infrastructure upgrade, NamPower infrastructure upgrade, All permits, licenses, and necessary contracts have been secured and remain in good standing.
Importantly, it was done so with over 2.5 million project hours worked with no serious injury or environmental incident. The project had a peak workforce of 1,200. The ongoing operations of the LHM are in the hands of a full-time local workforce of over 300, supported by 165 experienced mining contractors from Trollope Mining, a leading African mining contractor.
The first customer shipment from the LHM departed Walvis Bay, Namibia, in July 2024, and shipments will continue under the company’s long-term offtake agreements with top-tier industry counterparties.
“With a robust operational plan, strong performance since the restart, and the presence of a highly experienced team on the ground, we are confident in the ability of the LHM to generate significant value for our shareholders,” Purdy says.
Following the achievement of commercial production at the LHM on 30 March 2024, production ramped up with 517,597 lb U3O8 produced to 30 June 2024.
“The return of the Langer Heinrich Mine (LHM) to production was a major milestone on Paladin’s pathway to becoming a globally significant independent uranium producer. As we progressed the restart of the LHM, we simultaneously and deliberately executed a range of strategies aimed at transforming our company to ensure that we were in a formidable position to take advantage of both our asset base and the strong structural demand outlook for uranium,” Purdy further affirms, adding that during FY2024, Paladin achieved an outstanding performance in safety, completed the restart project, delivered first production at the LHM, and achieved the company’s strategic objectives.
“The return of the LHM to production is supported by a geographically diverse world-class offtake contract book, with offtake agreements secured with top-tier counterparties in the United States, Europe, and Asia. These organisations represent the leading offtake parties in the global uranium industry. Our contract book with these leading counterparties supports our operations whilst retaining exposure to the spot price, ensuring we have leverage to strengthen uranium pricing fundamentals. We will continue to layer our contract book to ensure we provide the right balance of risk protection and pricing upside to our shareholders.”
Paladin has a portfolio of over 440 Mlb of high-grade mineral resources in key global uranium jurisdictions. These globally significant high-grade exploration assets provide a strong future growth pathway for Paladin.
“At Langer Heinrich, our exploration activities are focused on reserve and resource expansion. The strong uranium price delivers the potential to lower the cutoff grade and optimise the mine plan to increase available tonnes for processing. Furthermore, workstreams are underway to determine key areas for exploration and infill drilling in the mining leases adjacent to our current mine plan. In the medium term, we will consider plant capacity expansions, ore sorting technologies, and heap leaching opportunities to maximise the value from this world-class asset.
“Paladin has a clear strategy for sustainable value creation. We have returned the LHM to production and commenced shipping to our leading global counterparties and are now focused on ramp-up activities at the mine to reach nameplate capacity. We will deliver development and exploration potential from our global portfolio of exploration and growth opportunities. And finally, we will embed sustainable returns and establish a capital management framework to drive long-term value to shareholders via returns on capital, organic growth, and M&A activity,” Purdy said.