The International Resource Journal: Marenica

Marenica
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admin on 24 January, 2010 10:17:00
 
Marenica marks the Spot 
In 1976, the first commercial uranium mine in Namibia opened. Fast-forward to
the present, and the World Nuclear Association predicts a 33 per cent increase
in uranium demand between 2010 and 2020. Today, Namibia remains supportive and
encourages uranium mining within the country. Perhaps then, it comes as no
surprise to see that those in the know are doing exactly that.
Meet Marenica Energy of Perth, Australia, formally West Australian Metals prior
to the com­pany’s name change last year. This promising exploration company
is focused on uranium in Namibia’s famed Damara Province.
“We changed the name late last year to Marenica Energy in order to emphasise
the focus on our Marenica Deposit,” John Young, CEO says.
“Prior to that, the company was called West Australian Metals and, although we
have two West Australian projects, our main focus has re­mained in Namibia.”
With over ten years experience spent as an ASX-listed company, Marenica turned
its atten­tions to Namibia in late 2006 with the com­pany’s acquisition of
the Marenica Deposit, a 527-square-kilometre site nestled promisingly amongst a
number of established uranium pro­ducing sites.
Prime positioning in Namibia
Young says that the Marenica Deposit is advan­tageously positioned 70
kilometres inland and about 100 kilometres from Swakopmund, a small town on the
West Coast of Namibia. It is also po­sitioned close to good infrastructure some
at the nearest major port, Walvis Bay.
“The project is adjacent to other uranium operations which are only 70
kilometres north of Rossing (Rio Tinto). Rossing has been operating as a uranium
mine in Namibia for over 30 years,” he says.
“There is another major project underway called Trekkopje, which is
majority-owned by Areva.  There are many significant uranium proj­ects in
Namibia, which is a world class area as far as uranium discoveries are
concerned.”
The company acquired the Marenica deposit from a local prospector who today
retains a 20 per cent share of the project, the other 80 per cent of which is
held by Marenica Energy.
The Marenica deposit was discovered in the late 70s and early 80s by Gold Fields
of South Africa and has amassed a good drilling history during this time,
allowing for the resource to be well-outlined within the project area.
With such a group of established neighbour­ing projects in this uranium
hotspot, and the history of interest in the Marenica project area itself, Young
explains the existing infrastructure surrounding the project.
“There are good tarred and unsealed roads and an accessible power grid, but
the main issue for Namibia is a good supply of fresh water,” he says. “Areva
have constructed a large desalina­tion plant on the coast as part of the
infrastruc­ture required for their development, which may also be able to
supply other operations with fresh water in the future. Their initial start-up
is some­thing like 25 million cubic metres of water a year.”
Young says that with all of these factors
considered, uranium exploration and project devel­opment in Namibia is not as
difficult as it may first appear to be.
Namibian support
Young says that the local Namibian mining in­dustry is very supportive of
foreign investment in the country. “There’s Areva, the French nuclear
utility company, located close to us at Trekkopje, and other Australian miners
and explorers such as Paladin Resources, Bannerman Resources, Deep Yellow and
Extract Resources.  There’s also a long history of Chinese investment in
con­struction in Namibia,” he says.
“The government like to see local employ­ment and local education and
involvement from Namibian companies. That is one of their priori­ties. 
Recently, the government of Namibia cre­ated a state-owned mining company to
take part in future mine developments for the benefit of all Namibian people
and, as an Australian com­pany operating in Namibia, we are very support­ive
of the idea.”
Other Namibian priorities include broad-based black economic empowerment and
com­munity support, which Young explains is why greater involvement with local
Namibian compa­nies is encouraged.
“As an employer, we have seven local Namib­ian people employed there (at the
Marenica de­posit),” Young says.
“We also have a small expatriate team, and their job is not only to control
the operations on the ground, but also to train and educate local people to
eventually take their positions and move up the ladder in the company. Those are
some of the things we try to do as a small explo­ration company.”
Marenica appears to be well on the way to cre­ating a balance where both
country and company support one another in a mutually beneficial way of working,
investing and educating.
The Marenica project today
Young says that to date, Marenica has completed over 35,000 metres of RC
drilling and over 1,000 metres of diamond drilling within the project area.
“In mid-2008, the company defined an inferred resource of 34 million pounds of
con­tained uranium. We have been improving the quality of project from there,
completing another 14,000 metres of infill  drilling and metallurgical work,”
he explains.
“We’re just about to launch into a scoping study which will look at the best
economic outcome for the project. Currently we have indicated and inferred
resources totalling around 38.6 million pounds. By the end of January, we’ll
have a resource update out which will upgrade that number.”
The company’s short term plan is to bring the Marenica project into
production, and young says that the scoping study, due for completion at the end
of the first quarter/start of the sec­ond quarter this year, will inform the
company as to the economical viabilities of the project and where to go from
there.
“We have 550 square kilometres of explora­tion ground which we’re
endeavouring to explore more fully in 2010, and of course any new dis­covery
within our project area could potentially add years to our mine life for the
Marenica deposit,” he says.
“We have a strong shareholder base with around 65 per cent of our shares held
by the top 20 shareholders. Recently, Areva NC has taken a 10.57 per cent
interest in Marenica. Now with Marenica located only 30 kilometres from
Areva’s Trekkopje operation, we will certainly be looking to develop our
relationship with Areva.”
The Marenica deposit is set to benefit all. From the shareholders to the locals
being trained on the project, this is an ideal example of a potential uranium
operation situated in prime Namibian uranium real estate.
“We have a deposit which is shallow, easily mined, easily processed, close to
key infrastruc­ture and at our current share price the company is pretty much
undervalued. My role in the short term is to get a positive scoping study to
enhance the value for our shareholders and to define the path­way to
development.”
The first half of 2010 and beyond looks very exciting for Marenica Energy.
www.marenicaenergy.com.au