ASX- and OTCQB-listed Lotus Resources will join the S&P/ASX 300 index on March 18, following the index’s March quarterly review.

Lotus owns an 85% interest in the Kayelekera uranium project, in Malawi, which is currently on care and maintenance. The other 15% is owned by the Malawi government.

The mine previously produced about 11-million pounds of uranium between 2009 and 2014 before its closure, which was brought on by a sustained low uranium price.

However, the uranium price hit a 17-year high on January 29, peaking at $106.25/lb. Various uranium market players and experts say uranium prices are set to remain elevated for a few more years, owing to increased demand brought on by commitments from numerous countries to build more nuclear power plants by 2050.

Capitalising on these developments, Lotus undertook a placement to strategic investors on February 28 to raise $30-million through the issue of 100-million new shares at $0.30. The placement will enable Lotus to accelerate the restart works at Kayelekera, as well as to advance works at its Letlhakane project, in Botswana.

“Our key priority remains progressing restart plans for Kayelekera to benefit from the increased demand for Kayelekera product and current strong and increasing uranium prices, but we also recognise that moving forward quickly with Letlhakane will enhance the company’s valuation,” Lotus MD Keith Bowes said, noting that the company plans to restart Kayelekera by the fourth quarter of 2025.

Lotus released a restart definitive feasibility study (DFS) in August 2022 that showed Kayelekera was one of the lowest capital cost uranium projects globally at $88-million. The restart DFS also showed that the project would only need 15 months of development to restart production once a final investment decision had been made.

So far, Kayelekera’s mining licence has been renewed and a community development agreement is currently under final review, with the completion of negotiations and the signing of a power supply and power implementation agreement with Malawi’s electricity utility Escom still pending. Lotus said this was key to achieving reduced operating costs announced in the restart DFS.

The company is still finalising financing and negotiating offtake agreements with suitable parties.

The company is also in the process of developing a front-end engineering design programme leading directly into the detailed engineering design phase for the execution of the restart plan. These studies aim to confirm the upfront capital cost estimate for the plant refurbishment and new equipment installations such that a control budget can be prepared for the restart.

They are also aimed at validating the 15-month timeline initially determined for the refurbishment programmme, as well as updating the operating costs from the DFS, including incorporating new quotes from suppliers.

Additionally, these studies will help determine long lead items and early works programmes required.

At Letlhakane, Lotus aims to complete a scoping study and also determine whether a more effective processing route can be identified to improve the 2015 feasibility study project economics, which had envisaged a heap leach process.

To achieve this, Lotus is planning to update the mineral resource remodelling for the project, incorporating tighter modelling constraints and shorter search parameters to reduce the amount of smoothing that has occurred within the higher-grade zones of the model. A resource update is planned for the second quarter.

Lotus is also planning the preparation of a preliminary geometallurgical model to help optimise the mine plan based on acid consumption and uranium mineralogy. In addition, the company aims to execute a preliminary mining study focused on pit optimisation work on the updated resource model to define the most economic pits within the project area.

An ore beneficiation test work programme also needs to be carried out to determine the potential for upgrading the ore prior to feeding to the main processing plant, while the preferred processing flowsheet based on the beneficiation results and overall grade / tonnage parameters needs to be considered.

Lotus is hoping to prepare a scoping study, or preliminary economic assessment soon, based on the mine planning and beneficiation test results and a selected processing route. This is expected to be done towards the latter half of the year.