Lotus Resources Ltd (ASX: LOT) shares are soaring today.
At the time of writing, the ASX 300 mining stock is up 11.5% to 19.5 cents.
Image source: Getty Images
What's going on with this ASX 300 mining stock?
There are a couple of reasons why this uranium developer's shares are taking off on Tuesday.
One is a broad rally in the uranium industry that is taking most miners and developers meaningfully higher today. This has been driven by a jump in uranium prices to a six-month high.
In addition, this morning, the ASX mining stock released a promising update on its Kayelekera uranium project in Malawi.
According to the release, Lotus has officially commenced cold commissioning at its Kayelekera processing plant. This is a key milestone ahead of the project's planned production restart in the third quarter of 2025.
Cold commissioning includes testing plant equipment before ore is introduced, and Lotus reports that several key circuits have already been completed. Hot commissioning is set to begin in the next month.
Management described this as a critical restart stage that positions the company well for the planned production timeline.
The ASX 300 mining stock's managing director, Greg Bittar, commented:
We are pleased to have commenced cold commissioning of the Kayelekera processing plant, already completing this for several key plant areas including pre-leach, leaching and resinin-pulp circuit. The commencement of this critical restart stage positions Lotus well for Q3 2025 restart of production at Kayelekera.
Owner-operator strategy
Lotus also announced that it will perform its own mining operations rather than rely on a contractor.
This owner-operator model is expected to provide better control over ore production and reduce mining costs, which make up about a third of Kayelekera's C1 cash costs.
The company will invest around US$8 million in mining equipment, financed via debt facilities that are currently being finalised. Equipment orders have been placed, with mining scheduled to begin in the fourth quarter of 2025.
Commenting on the decision, Bittar adds:
Following an exhaustive mining contractor tender process and simultaneously undertaking a detailed examination of an owner-operator mining model, we have adopted an owner-operator model.
The opportunity to adopt this model presented strongly as we built out the site management and operational team with tremendous mining and maintenance experience, well suited for a relatively small open pit mining operation. With the very limited mining presence in Malawi and hence limited synergies available to mining contractors, the owner-operator mining model is the most cost effective and flexible option.
