Quarterly Report for the Period Ending 31 Dec 23

Aura Energy Limited

30 January 2024

 

 

                                                                                                                       30 January 2024  

Quarterly Report for the Period Ending 31 December 2023

KEY POINTS: ·    The spot uranium price continued to strengthen during the quarter to over US$100/lb U3O8 as at 29 January 2024. This follows a roughly 90% price increase through 2023.  The strength in uranium demand is expected to continue, underpinned by a fundamental global shift towards nuclear power as a low-carbon and reliable energy source. ·    Aura Energy is well positioned to benefit from these favourable macro trends with near term uranium production at Tiris and significant potential growth in uranium resources: o  In addition to the currently defined 58.9 Mlbs uranium Mineral Resource, exploration targeting during the quarter identified seven new exploration targets and estimated further resource potential of between 8 - 32 Mlbs U3O8 from extensions to the existing Mineral Resources. o  Drilling has commenced to test these targets and to add Mineral Resources at Tiris. o  13,000 km2 of prospective uranium exploration tenements were applied for in the Tiris uranium province during the quarter which should result in future uranium discoveries. o  The Front End Engineering Design ("FEED") studies for the Tiris Uranium Project are well advanced and should be completed Q1 2024 and will be the next step in delivering a commercial scaled low cost ~2 Mlbs/pa uranium mine at Tiris. o  The ~2 billion tonne Häggån polymetallic deposit in Sweden also contains, in addition to vanadium,   very significant uranium Mineral Resources of 800 Mlbs U3O8. This adds further leverage for Aura shareholders to a rising uranium price subject to an anticipated change in Swedish legislation banning uranium extraction. In the cooperation agreement between the four governing parties in the Swedish conservative coalition, an amendment was made in November 2023, stating that mining of uranium shall not be prohibited. This is in line with the Swedish Government's ambitions to expand the use of nuclear power and to build new reactors. ·    Post the reporting period: o  On 24 January 2024, the Company announced proceeds from the exercise of approximately 82.5 million listed options expiring 30 June 2024 have been secured through option funding agreements and an option exercise underwriting agreement, to raise A$4.3m. o  On 30 January 2024, Andrew Grove was appointed as Managing Director and CEO.

Aura Energy Limited (ASX: AEE, AIM: AURA) ("Aura" or the "Company") is pleased to provide an overview of activities for the period ended 31 December 2023 ("Quarter" or "Reporting Period") to accompany the Appendix 5B.  The priorities for Aura remain the development of the Tiris Uranium Project in Mauritania ("Tiris") and advancement of the Häggån Polymetallic Project in Sweden ("Häggån").

To view Appendix 5B, please click here: http://www.rns-pdf.londonstockexchange.com/rns/3636B_1-2024-1-30.pdf

 Uranium - price continues to strengthen

The positive sentiment towards nuclear power has shown no indication of softening. The rapid increase in the spot price of uranium has occurred within the context of positive media coverage about growing demand and the historic supply deficit. The pivot towards nuclear energy reflects the reality that renewable energy solutions are unable to provide sufficient reliable base load energy supply to meet predicted consumption in the years ahead.

Current thematics support the positive uranium price trend to continue, including:

·    Available uranium stocks have fallen considerably;

·    EU sentiment towards nuclear power as an alternative and reliable fuel source to replace fossil fuels has improved significantly; and

·    Renewable energy sources are proving to have practical limitations in terms of:

o  Significant infrastructure requirements (including batteries) to link to existing power distribution networks

o  Lack of continuous generation capability (especially solar and wind)

o  Requiring larger land footprints than traditional and nuclear energy sources.

The United Nations' ("UN") COP28 climate conference held in Dubai in December 2023, officially called for accelerating the deployment of low-emission technologies, including nuclear energy, to help achieve "deep and rapid decarbonization". The decision represents the first time the 198 signatory countries to the UN Framework Convention on Climate Change have included nuclear energy in the Global Stocktake.

Government policies are also more focused on energy security and increased geopolitical supply risk has further exacerbated the price rises. On 11 December 2023, the US House of Representatives passed legislation that would potentially ban the import of Russian uranium into the USA.

The US, Canada, UK, Japan and France are among many countries that have pledged to triple nuclear capacity by 2050[1]. In addition, in order to supply its rapidly growing reactor fleet, China is seeking to increase uranium consumption from 30Mlbs to 150Mlbs in the next 15 years[2].

Notable events during the Quarter include:

·    22 nations pledged at the COP28 summit to triple nuclear capacity by 2050. [3]

·    The International Atomic Energy Agency's (IAEA) annual nuclear power outlook high case projection sees installed nuclear capacity increasing to 890 gigawatts by 2050 compared to 369 gigawatts presently.[4]

·    Belgian Prime Minister Alexander De Croo, French President Emmanuel Macron and Director of the IAEA Rafael Mariano Grossi announced the world's first Nuclear Energy Summit will be held in Brussels in March 2024. [5]

Tiris, Mauritania

The Tiris Uranium Project is situated in the province of Tiris Zemmour, located in the northern most region of Mauritania - a country supportive of responsible development of mineral projects.

Throughout the Quarter, the Company has continued progressing the Tiris Uranium Project towards becoming a commercial scaled low cost ~2 Mlbs U₃O₈ pa uranium mine as detailed in the Tiris Enhanced Feasibility Study.[6]  

The FEED study has largely been completed, with the final review and release expected in Q1 2024. 

An exploration targeting review in October 2023 identified seven new exploration targets and estimated further resource potential of between 30-60 Mt at 120 - 240ppm U₃O₈ for 8 - 32 Mlbs U₃O₈ from extensions to the existing Mineral Resources.[7] A ~15,500m drilling program has commenced subsequent to the end of the Quarter to test the new targets and extend Mineral Resources.[8]

Given the high prospectivity of the region, the Company applied for 13,000 km² of new exploration tenements in the broader Tiris area, in November 2023.[9] Once granted, these new tenements will be systematically explored with the aim of developing Tiris into a world-class Uranium province.

Figure 1 - Temporary camp for the current exploration drilling campaign

Tiris Uranium Project Front End Engineering Design Study

The Tiris FEED study is in the final stages and release expected in Q1 2024.  All technical deliverables have been completed, and final review of capital and operating costs and financial analysis underway.  The capital cost of the project has been significantly de-risked through detailed engineering estimates, notwithstanding an anticipated increase in capital cost impacted by global supply and inflation factors, similar to those seen throughout the industry. Significant economies of scale have been identified through increasing the potential scale of production, partially offset by a reduction in Mauritanian diesel fuel subsidies.

The Company remains confident of delivering a strong financial result for the Tiris Uranium Project. 

The following diagram of the production facility illustrates the largely modular and thereby scalable  nature of the planned processing plant.

Figure 2 - 3D Layout of processing circuit module 2 Mlbs/pa U₃O₈ Tiris Uranium Project

Engagement with the Mauritanian National Authority for Radiation Protection, Safety and Nuclear Security ("ARSN") is ongoing, with Orano NPS appointed to finalise the logistics solution for delivering Tiris yellowcake into the global market and the export permit.

Negotiations with global utilities over the award of offtake agreements ("Offtake") have been assisted by the uranium spot price surging to 15-year highs. The spot price of US$100/lb U₃O₈ reflects the growing worldwide acceptance that nuclear energy will be critical for successfully transitioning away from fossil fuel dependency and positions the company advantageously leading into 2024.

Tiris Exploration

An exploration review using newly acquired radiometric, historic radiometric and drilling data demonstrated the strong correlation between radiometric strength and uranium mineralisation.  Geologists identified seven new untested exploration targets. Exploration Targeting estimated the potential for additional resources immediately adjacent and contiguous to the existing Mineral Resource of between 8 Mlb to 32 Mlb U₃O₈[10] (see table below).

A 15,500m air core drilling campaign has commenced subsequent to the end of the Quarter, with the objective of testing the newly identified targets and to expand the Mineral Resources which can be subsequently added to the mine plan for the future Tiris Uranium Mine (Figure 3).

Historically, because of the shallow nature of the uranium mineralisation (<5m depth) and because of the effectiveness of radiometrics as a targeting tool, Aura has delivered Mineral Resources at very low cost of only US$0.20 per lb U₃O₈ at Tiris.

	Range of Tonnage and Grade Expectations				Range of Exploration Target
Resource Area	Tonnes Lower (Mt)	Tonnes Upper (Mt)	Grade Lower U₃O₈ (ppm)	Grade Upper U₃O₈ (ppm)	Lower Range Mlbs U3O8	Upper Range  Mlbs U3O8
Tiris East[11]	30	60	120	240	8	32
Total Target	30	60	120	240	8	32

Figure 3 - Tiris Project exploration program target areas

The Tiris Zemmour Province, northern Mauritania, has only had very limited uranium exploration, other than by Aura, but is highly prospective for additional discoveries similar to Tiris. Using Aura's deep knowledge of the area and the nature of the uranium mineralisation, Aura has applied for an additional ~13,000 km² of exploration tenements securing a controlling position of this potential world-class Uranium province. The tenements were identified through an extensive 12-month evaluation program based on radiometric survey data and historical drilling results compared to the work completed on the Tiris Uranium Project. The Company is confident that the proven model of successful exploration can be extended across the wider Tiris Zemmour region.

During the Quarter, Aura received the renewal of the exploration tenements for Oued El Foule Sud and its subsidiary Tiris International Mining Co (TIMCO) tenements at its Tasiast South project area, approximately 35km along strike from Kinross' 20Moz Tasiast Gold Mine and is prospective for both gold and nickel. 

Table 1 - Aura Energy exploration tenements 

(NB. Tenement 561 - Oum Ferkik is currently under application for exploitation permit)

Tenement No.	Name	Grant Date	Expiry	Km2	Holder	Equity
561	Oum Ferkik			60	Aura Energy Limited	100%
2365B4	Oued El Foule Sud	7/11/2023	7/11/2026	166	Aura Energy Limited	100%
2457B2	Hadeibet Belaa	7/11/2023	7/11/2026	41	Tiris International Mining Co.	100%
2458B2	Touerig Taet	7/11/2023	7/11/2026	134	Tiris International Mining Co.	100%

Häggån Project Update

The Häggån project is located in Berg municipality in the province of Jämtland in central Sweden and hosts a very substantial ~2 billion tonne polymetallic Mineral Resource (Table 2, ASX release 10 October 2019) which includes 800 Mlbs of U₃O₈. (2.35Bt @ 155ppm U₃O₈, ASX release 22 Aug 2012). The deposit is owned 100% by Aura Energy through its subsidiary Vanadis Battery Metals AB.

Sweden is Europe's leading mining and mineral nation. The adoption by the Swedish parliament of a new energy target, changing from "100% renewable" to "100% fossil-free" electricity, is an important part of the transition towards the use of nuclear power and uranium mining in Sweden. The Company is supportive of this policy and can play an important role in supporting this energy transition.

Table 2 - 2019 Häggån Mineral Resource Statement

The Company undertook a series of community consultation meetings with local stakeholders in relation to 100%-owned Häggån Project. These meetings have allowed the community to ask questions regarding the project and the recently released Scoping Study.

Aura continues to work towards the submission of the 25-year exploitation permit and is undertaking baseline environmental monitoring.

Following the completion of the Scoping Study released in September 2023, Aura is confident in the substantial economic potential that the Häggån Project offers to Sweden, the local community and shareholders of Aura Energy. While the potential to extract uranium from the ore body undoubtably adds value to the project, the Base Case for the Häggån Project (ex-uranium) still shows excellent economic returns.

Corporate Activities

Aura participated in the Toronto Fall Mining Showcase and the International Mining and Resources Conference (IMARC) in Sydney at the beginning of November presenting to stakeholders and potential institutional investors.

4.5 million options expiring 30 June 2024 at an exercise price of $0.052 per share were exercised during the period.

The Company's cash position as of 31 December 2023 was A$5.87 million. The Company's major cashflow movements for the quarter included:

·    Investments in the Company's Exploration and Evaluation assets of A$1.24 million;

·    Staff costs of A$0.96 million; and

·    Admin and corporate costs of A$0.70 million.

The forecasted net operating cashflow and investment in the Company's exploration and evaluation assets for the coming quarter is A$2.92 million. With a closing cash balance of $5.87 million, the company has enough cash for 2.01 quarters.

Post the reporting period, the Company announced on 24 January 2024 that proceeds from the exercise of approximately 82.5 million listed options expiring 30 June 2024 have been secured through option funding agreements and an option exercise underwriting agreement, to raise A$4.3m.

On 30 January 2024, Aura Energy appointed Andrew Grove as Managing Director and CEO. Mr Grove is a highly experienced mining and finance executive with extensive global industry experience across multiple commodities. This includes more than 30 years of managerial, technical, commercial and finance experience, including significant expertise in uranium and West African development and operations.

Tenement Summary

The Company holds the following interest in mining tenements, farm-in and farm-out agreements at the end of the Quarter:

Table 3 - Tenement Summary

Tenement No.	Name	Grant / Application Date	Expiry	Km2	Holder	Equity
Mauritania
2491C4	Ain Sder	8/02/2019	2/8/2049	207	Tiris Ressources SA	85%
2492C4	Oued El Foule	8/02/2019	2/8/2049	190	Tiris Ressources SA	85%
561	Oum Ferkik	16/04/2008	Pending approval of application for Exploitation License	60	Aura Energy Limited	100%
2365B4	Oued El Foule Sud	07/11/2023	07/11/2026	166	Aura Energy Limited	100%
2457B2	Hadeibet Belaa	07/11/2023	07/11/2026	41	Tiris International Mining Co.	100%
2458B2	Touerig Taet	07/11/2023	07/11/2026	134	Tiris International Mining Co.	100%

Tenement No.	Name	Grant / Application Date	Expiry	Km2	Holder	Equity
Sweden
2007-243	Häggån nr 1	28/08/2007	28/08/2024	18	Vanadis Battery Metals AB	100%
2018-9	Mockelasen nr 1	21/01/2019	21/01/2024 (new application applied for)	18	Vanadis Battery Metals AB	100%
2018-7	Skallbole nr 1	20/01/2019	20/01/2024 (new application applied for)	8	Vanadis Battery Metals AB	100%

Farm-in agreement with Nomads Mining Company sarl, Mauritania, Aura, through subsidiary Archean Greenstone Gold has earned a 70% interest in Nomads 100%-owned exploration permit in Mauritania (refer to ASX announcement 11 June 2019).

ENDS

The Board of Aura Energy Ltd has approved this announcement.

Market Abuse Regulation (MAR) Disclosure

The information contained within this announcement is deemed by the Company to constitute inside information as stipulated under the Market Abuse Regulations (EU) No. 596/2014 as it forms part of UK domestic law by virtue of the European Union (Withdrawal) Act 2018 ('MAR'). Upon the publication of this announcement via Regulatory Information Service ('RIS'), this inside information is now considered to be in the public domain.

For further information, please contact:

David Woodall Managing Director and CEO Aura Energy Limited [e-mail]	Paul Ryan Citadel-MAGNUS Investor & Media Relations [e-mail] [phone]
SP Angel Corporate Finance LLP ( Nominated Advisor and Broker) David Hignell Kasia Brzozowska [phone]

About Aura Energy (ASX: AEE, AIM: AURA)  

Aura Energy is an Australian-based exploration and mining company with major uranium and polymetallic projects in Africa and Europe.

The Company is focused on uranium production commencing at the Tiris Project, a major greenfield uranium discovery in Mauritania.

Aura plans to transition from a uranium explorer to a uranium producer to capitalise on the rapidly growing demand for nuclear power as the world shifts towards a decarbonised energy sector.

Aura also owns 100% of the ~2 billion tonne Häggån Polymetalic Project in Sweden. Häggån contains a global-scale vanadium and uranium resources that could potentially be mined for generations. Utilising only 3% of the resource, a 2023 Scoping Study outlined a potential 27-year mine life based on mining 3.5 Mtpa.

Disclaimer Regarding Forward-Looking Statements 

This ASX announcement (Announcement) contains various forward-looking statements. All statements other than statements of historical fact are forward-looking statements. Forward-looking statements are inherently subject to uncertainties in that they may be affected by various known and unknown risks, variables and factors which could cause actual values or results, performance, or achievements to differ materially from the expectations described in such forward-looking statements. The Company does not guarantee that the anticipated results, performance, or achievements expressed or implied in those forward-looking statements will be achieved. 

Competent Persons Statement

The Competent Person for the portion of the 2022 Tiris Vanadium Mineral Resource Estimate and classification relating to the Hippolyte, Hippolyte South, Lazare North, and Lazare South deposits is Mr Arnold van der Heyden of H&S Consulting Pty Ltd. The information in the report to which this statement is attached that relates to the 2018 Mineral Resource Estimate is based on information compiled by Mr van der Heyden. Mr van der Heyden has sufficient experience that is relevant to the resource estimation to qualify Mr van der Heyden as a Competent Person as defined in the 2012 edition of the 'Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves. Mr van der Heyden is an employee of H&S Consultants Pty Ltd, a Sydney-based geological consulting firm. Mr van der Heyden is a Member and Chartered Professional of The Australasian Institute of Mining and Metallurgy (AusIMM) and consents to the inclusion in the report of the matters based on his information in the form and context in which it appears.

The Competent Person for the portion of the 2022 Tiris Vanadium Resource Estimate and classification relating to all other deposits within the resource (Sadi South, Sadi North, Marie, Hippolyte West, Oum Ferkik East, Oum Ferkik West deposits) is Mr Oliver Mapeto, an independent resources consultant.

The information in the report to which this statement is attached that relates to the 2018 Resource Estimate is based on information compiled by Mr Mapeto. Mr Mapeto has sufficient experience that is relevant to the resource estimation to qualify Mr Mapeto as a Competent Person as defined in the 2012 edition of the 'Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves. Mr Mapeto is a Member of The Australasian Institute of Mining and Metallurgy (AusIMM) and consents to the inclusion in the report of the matters based on his information in the form and context in which it appears.

The Competent Person for drill hole data and for integrating the different resource estimates is Mr Neil Clifford. The information in the report to which this statement is attached that relates to compiling resource estimates and drill hole data is based on information compiled by Mr Neil Clifford. Mr Clifford has sufficient experience that is relevant to the style of mineralisation and type of deposit under consideration and to the activity which he is undertaking to qualify Mr Clifford as a Competent Person as defined in the 2012 edition of the 'Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves. Mr Clifford is a consultant to Aura Energy. Mr Clifford is a Member of the Australasian Institute of Geoscientists. Mr Clifford consents to the inclusion in the report of the matters based on his information in the form and context in which it appears.

Appendix 1: Resources and Reserves

Table 1 - Tiris Uranium Project Updated Mineral Resource Estimate

		Mineral Resource Estimate February 2022[12]			Mineral Resource Estimate February 2023
Resource Location	Category	Tonnes (Mt)	U3O8    (ppm)	U3O8 (Mlbs)	Tonnes (Mt)	U3O8    (ppm)	U3O8 (Mlbs)
Hippolyte North	Measured	5.7	225	2.8	8.0	236	4.2
	Indicated	6.5	217	3.1	5.8	217	2.8
	Inferred	7.4	281	4.6	4.7	212	2.2
	Sub-Total	19.6	245	10.5	18.5	224	9.1
Hippolyte Marie & West	Inferred	8.2	310.0	5.6	8.2	310	5.6
Hippolyte South	Indicated	4.8	192	2.0	4.6	192	2.0
	Inferred	3.1	176	1.2	2.7	176	1.1
	Sub-Total	7.9	177	3.2	7.4	186	3.0
Lazare North	Measured	1.1	284	0.7	1.0	282	0.6
	Indicated	10.6	229	5.4	10.1	229	5.1
	Inferred	3.9	210	1.8	3.7	210	1.7
	Sub-Total	15.6	224	7.9	14.8	228	7.4
Lazare South	Measured	3.4	239	1.8	8.6	233	4.4
	Indicated	2.6	219	1.3	5.2	226	2.6
	Inferred	9.1	214	4.3	4.8	222	2.3
	Sub-Total	15.1	225	7.4	18.6	228	9.3
Sadi	Measured				11.5	189	4.8
	Indicated	4.5	240	2.4	7.4	200	3.2
	Inferred	14.8	266	8.7	10.3	228	5.2
	Sub-Total	19.3	301	11.1	29.2	206	13.2
Total Tiris East Resource	Measured	10.2	235	5.3	29.1	218	14.0
	Indicated	29.0	248	14.2	33.0	215	15.6
	Inferred	46.5	254	26.2	34.5	237	18.0
	Total	85.7	242	45.7	96.6	224	47.7
Oum Ferkik Resource	Inferred	16.4	305	11.2	16.4	305	11.2
Total Tiris Project Resource[13]		102.1	253	56.9	113.0	236	58.9

The declared Ore Reserve, at a 110 ppm U₃O₈ cut off is shown in Table 2.

Table 2 - Updated Ore Reserve

Description	Mt	U3O8 (ppm)	U3O8 (Mlb)
Lazare North
Proved	0.9	298	0.6
Probable	7.9	251	4.4
Lazare South
Proved	6.5	264	3.8
Probable	2.6	291	1.7
Hippolyte
Proved	5.7	270	3.4
Probable	7.1	231	3.6
Sadi
Proved	6.1	232	3.1
Probable	3.3	261	1.9
Total Ore Reserve
Proved	19.3	257	11.0
Probable	21.3	251	11.6
Total Tiris East Reserve	40.3	254	22.6

Notes:

1.        Ore Reserves are a subset of Mineral Resources.

2.        Ore Reserves conform with and use the JORC Code 2012 definitions.

3.        Ore Reserves are calculated using a uranium price of US$65 /lb.

4.        Ore Reserves are calculated using a cut-off grade of 110 ppm U3O8.

5.        Tonnages are reported including mining dilution.

6.        All figures are rounded to reflect appropriate levels of confidence which may result in apparent errors of summation.

Table 3 - 2019 Häggån Mineral Resource Statement^[14]

V2O5 Cut-Off	Class	Mt Ore	V2O5	Mo	Ni	Zn	K2O	Million lbs
%			%	ppm	ppm	ppm	%	V2O5
0.10	Indicated	45	0.34	213	365	501	4.11	332
	Inferred	2,503	0.27	200	312	433	3.73	14,873
0.20	Indicated	42	0.35	217	375	512	4.13	320
	Inferred	1,963	0.30	212	337	463	3.80	13,010
0.30	Indicated	61	0.38	223	398	536	4.22	258
	Inferred	954	0.35	226	374	503	3.95	7,390
0.40	Indicated	11	0.44	225	429	580	4.46	101
	Inferred	113	0.43	232	419	562	4.25	1,072

---

[1] COP28: Opposition climate change spokesman Ted O'Brien takes Australia's nuclear brawl to Dubai (afr.com)

[2] How China has Become the World's Fastest Expanding Nuclear Power Producer | IAEA

[3] Nuclear Energy Makes History as Final COP28 Agreement Calls for Faster Deployment | IAEA

[4] Nuclear Energy Makes History as Final COP28 Agreement Calls for Faster Deployment | IAEA

[5] Nuclear Energy Makes History as Final COP28 Agreement Calls for Faster Deployment | IAEA

[6] ASX Release: "Tiris Uranium Project Enhanced Definitive Feasibility Study", 29 March 2023

[7] ASX Release: "New Uranium Exploration Target Identified at the Tiris Project" 17 October 2023

[8] ASX Release: "Commencement of extensional drilling program at Tiris", 5 January 2024

[9] ASX Release: "New Tiris Project tenement applications", 29 November 2023

[10]   ASX Release: "New Uranium Exploration Target Identified at the Tiris Project" 17 October 2023

[11] Ain Sider, OEFE and OEFE Sud tenements - Hippolyte East, Hippolyte West, Marie, Hippolyte North, Lazare North, Lazare South and Sadi resource areas.

[12] ASX & AIM Release 16 February 2022 "Aura Defines Vanadium JORC Resource at Tiris Uranium Project "

[13] Totals may vary due to rounded figures.

[14] ASX Release: Häggån Battery Metal Project Resource Upgrade Estimate Successfully Completed, 10 October 2019

 

END