The Deep Yellow Limited (ASX: DYL) share price struggling to catch a bid even after the company announced a major ore reserve milestone at its Tumas Project.
At the time of writing, Deep Yellow shares are down 4.04% to 95 cents.
Located in Namibia, Deep Yellow has carried out exploration activities at Tumas since 2016. During this time, the company has expanded its resource more than threefold and continues to carry out exploration activities to drive its resource base.
Deep Yellow share price flat despite major ore reserve milestone
Deep Yellow successfully completed resource upgrade drilling at sites across the Tumas Project which led to a 121% increase in its updated ore reserve estimates.
The company was pleased to announce a significant upgrade to its previous ore reserves from its pre-feasibility study (PFS) announced on 10 February.
The PFS defined a probable ore reserve base of 31 million pounds of uranium at 344 parts per million with a life of mine of 11.8 years.
Today's result has proved sufficient to achieve the company's key focus area of its definitive feasibility study (DFS) which was to establish sufficient ore reserves to support a life of mine of more than 20 years.
Deep Yellow's updated ore reserve show 68.4 million pounds of probable ore reserves at 345 parts per million.
Management commentary
Commenting on the major DFS milestone, Deep Yellow managing director John Borshoff said:
A major risk milestone for Tumas has been overcome and we are very pleased with the results, which have confirmed Tumas as a long life of mine operation and demonstrated great potential to develop the Project into a tier-one uranium deposit.
Importantly, significant potential remains to grow Tumas through upgrading remaining Inferred Resources and further exploration of Tumas Palaeochannel, with approximately 40% yet to be fully tested, providing Deep Yellow with exceptional, additional optionality for optimisation of the DFS, which is expected to be completed in the latter part of CY2022.
Deep Yellow share price so far
The Deep Yellow share price boomed between late August and mid-September after uranium spot prices skyrocketed from US$30/lb to a 9-year high of US$50/lb.
After surging more than 100% to an 8-year high of $1.37, Deep Yellow shares have since retraced to around the $1.00 level.
Likewise, uranium prices have also cooled, currently fetching around US$43.5/lb.
