New Kayelekera uranium mine owner cuts costs, prepares for restart

As a part of cost saving initiative, Lotus shut down and decommissioned water treatment plant, will replace it with more cost-effective evaporation system

Lotus Resources Limited (LOT, Lotus or the Company) provided an update on its Kayelekera Uranium Project (the Project) in Malawi in relation to a significant reduction in care and maintenance cost guidance and with regard to advancements of certain recommencement activities for uranium production at the Project.

HIGHLIGHTS
 Care and maintenance operating cost guidance at the Kayelekera Uranium Project reduced by 75% to an annualised cost of US$1.2M from the original 2019 budget estimate of c.US$5M.

  • A safe and environmentally responsible approach has been followed that complies with all
    statutory regulations.
  • Number of full-time employees onsite reduced to 16 (down from 116).
  • Non-essential services performed by contractors.
  • Diesel fuel price reductions negotiated.

 Water treatment activities have now been completed with dam levels reduced to required levels and a revised strategy for next wet season being developed that should allow further potential savings.

  • Water treatment plant is shut down and fully decommissioned.
  • Water management will be based on a more cost-effective evaporation system.

 Lotus is continuing to work towards a restart study with advancements in process optimisation and improvement plans which will form the basis for the study.

Eduard Smirnov, Managing Director, commented: “Our operations and regional teams have done a great job in taking timely action to introduce cost-effective, safe and environment friendly and
regulatory compliant measures at the Project site. A key focus of this plan is on preserving cash and advancing our plans to build a new uranium supplier while coping with the restrictive conditions
during Covid-19 pandemic.”

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