More uranium is consumed than produced and higher incentive prices are required to support new supply: GoviEx Uranium

GoviEx Uranium has explained that every year, more uranium is consumed than produced, and higher incentive prices are required to support new supply

GoviEx Uranium is the developer of Mutanda Uranium mining project has indicated that it plans to start actual uranium mining in Zambia in the next five years.

In a statement, the Canada listed company stated that “the mine-permitted Mutanga project in Zambia is forecast to start production in 2027 and could be the lowest capital intensive uranium project in Africa.”

In its annual statement to shareholders, GoviEx stated that “Uranium prices rose 39% in 2021. Higher demand from new market participants has contributed to increases in spot prices. Every year, more uranium is consumed than produced, and higher incentive prices are required to support new supply”.

And the investment into Mutanda Mine has received an impetus following the supply crisis which is concentrated in Kazakhstan. GoviEx stated that “the recent crisis in Kazahkstan has highlighted the potential risk to output especially given the concentration of supply and this underlines the need for increased regional diversification that GoviEx’s projects can provide.”

Africa focused Uranium developer further states that “Demand for uranium is forecast to increase as China looks to reduce its dependency on coal by pledging to build 150 new nuclear reactors by 2060. Nuclear power may be included in the EU’s Sustainable Taxonomy Regulation and this could impact the industry by bringing investment towards nuclear, which is already Europe’s largest single source of low carbon energy and forecast to grow.”

The Mutanga Uranium Project consists of five main deposits: Mutanga, Dibwe, Dibwe East, Njame, and Gwabe. These deposits make up the bulk of the Mineral Resources described herein. The Project area is situated in the Southern Province of Zambia about 200 km south of Lusaka, immediately north of Lake Kariba, approximately 31 km northwest of Siavonga.

GoviEx acquired 100% of the Mutanga Project in 2016 from Denison Mines. The project included the Mutanga, Dibwe, and Dibwe East deposits. In 2017, GoviEx acquired 100% of the Njame and Gwabe deposits from African Energy Resource.

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