Despite difficulties on the uranium market, Namibia-based Rossing Uranium, a subsidiary of Australia-based Rio Tinto, increased production from 1245t of uranium oxide (tU) in 2015 to 1850t in 2016.
Rossing said revenue increased by 67% compared to 2015 due to higher sales volumes as result of the return to continued operations late in 2015. Rossing is the world’s longest-running open pit uranium mine. Operating since 1976, it has produced the most uranium of any single mine. The mine returned to a 24-hour shift roster and seven-day operational schedule at the end of 2015. This, together with the exchange rate that was in the company’s favour most of the year, resulted in net profits from normal operations of NAD107m ($8m) compared with a loss of NAD385m the previous year.
Rossing said the spot price of uranium fell 50% between January and November 2016, at one point hitting below US$20 per pound. “To put that depreciation into perspective, the break-even cost for most uranium mines is estimated at between $40 and $50 per lb,” the company said. Rossing said the price falls were caused by the emergence of additional secondary supplies and large volumes of new production in 2016, as well as the very slow rate of progress with reactor re-start in Japan. Prices stabilised at the end of 2016 at around $20 per lb. The average spot market price in 2016 was $25.64 per lb.