The company that hopes to develop Western Australia's first uranium mine has bought a significant uranium project nearby, saying it offers expansion opportunities.
Toro Energy, which aims to begin production at its Wiluna project in central WA in 2016, on Monday announced it had agreed to buy the Lake Maitland uranium project from Canada's Mega Uranium for 415 million Toro shares.
Based on the company's closing share price on Friday of 8.9 cents, the value of the transaction is almost $37 million and gives Mega a 28 per cent stake in Toro, behind OZ Minerals, which owns 28.5 per cent and intends to vote in favour of the agreement.
Toro said the deal boosted its resource base in the Wiluna region by 42 per cent, potentially enough for a project of at least 20 years.
Lake Maitland, 90km southeast of Wiluna, contains higher grade material that is expected to improve the overall blended head grade from the Wiluna deposits.
Toro still needs to secure project financing for the Wiluna project and hopes to complete a definitive feasibility study next year.
WA's Minister for Mines and Petroleum Bill Marmion welcomed the announcement, saying a longer mine life and lower costs meant more local jobs.
"The Toro acquisition of Lake Maitland looks set to result in considerable positive economies of scale outcomes, which will help make the fledgling Western Australian uranium industry more competitive," he said.
The Liberal state government is in favour of uranium mining, in 2008 lifting a six-year ban on uranium extraction imposed by the previous Labor administration.
