Deep Yellow Limited (Deep Yellow) says the Final Investment Decision (FID) for its flagship Tumas Project has been deferred until early March 2025.
This decision follows delays in final costings and quotes for detailed engineering work, as well as ongoing efforts to optimise and enhance the project.
Despite this setback, the company remains confident in the overall viability of Tumas and expects the minor delay to have no material impact on the project’s timeline, which still targets production to begin in late 2026.
“Our ongoing detailed work continues to reinforce Tumas as an exceptional project and development opportunity. We are now expecting an optimised, detailed engineering report by end February 2025 and FID to be delivered in early March 2025. This delay is considered minor in the scheme of this project, and it is also important we make our final decisions based on the best, most up-to-date information and in the best interests of our shareholders,” said Deep Yellow Managing Director John Borshoff.
He further explained that the Tumas development has been divided into two distinct workstreams: Early Works and Execution Phase.
The Early Works phase, which is being managed directly by the Deep Yellow Owner’s Team, includes vital infrastructure projects such as power and water supply lines, roads, site offices, and other related facilities.
The execution phase will focus on the construction of the processing plant and associated works, to be handled by the appointed Engineering, Procurement, Construction and Management (EPCM) contractor, Ausenco Services Pty Ltd.
Recent milestones have shown significant progress on the Tumas Project, including an upgraded ore reserve estimate, with an increase in proven and probable reserves, extending the project’s life expectancy to over 30 years.
Additionally, the company has secured both water and power supply offers from NamWater and NamPower, which have been accepted and are now moving toward final contract execution.
Final bid documentation for major equipment and an updated mining schedule are also underway, ensuring that early works continue smoothly to avoid project delays.
“An upgraded Ore Reserve Estimate (ASX release 18 December 2024), showing a substantial increase in the proven and probable ore reserves, sufficient to increase Life of Mine expectations to at least 30 years from 22.5 years previously in the DFS,” he said.
However, the commencement of full-scale construction remains contingent on uranium price levels.
Deep Yellow’s Board has indicated that the uranium price must rise to a level that incentivises new greenfield developments before construction begins.
The company believes the current uranium price does not reflect the growing demand for nuclear power and the likely supply shortage in the coming years.
Deep Yellow is also cautious about the projected growth in uranium supply, which many analysts see as overstated.
“The outlook for nuclear power remains extremely optimistic. Substantial uranium supply, potentially a doubling of annual supply by 2040, will be required, and we believe that will be difficult to achieve, giving us a definite competitive advantage in what we anticipate will be a more positive price environment,” he said.
