Windhoek — Langer Heinrich will receive a boost of N$515 million from its parent company, Paladin Energy, for its third expansion plans, said Wyatt Buck, general manager of operations at the mine.

He said the second stage of expansion, which will increase the production of uranium oxide to 3.7 million pounds per year, has already been implemented.

"A good deal of the equipment will be completed by the end of June allowing for production levels near 3.7 million pounds per year, but dependent on ability to commission. Some equipment such as Ion exchange and mining trucks have been implemented during this last quarter," said Buck.

Paladin also gave approval for stage three of the expansion plans at Langer Heinrich this week, after a feasibility study was concluded. Through stage three, production will increase to 5.2 million pounds of uranium oxide each year.

The company announced that no significant additional infrastructure was needed reducing the capital cost to US$71 million.

Initially, Paladin planned on expanding production to 6 million pounds of uranium oxide, which would have cost US$174 million.

"A revised scenario was developed based upon maximum utilisation of the current water allowances such that the stage three expansion was not vulnerable to delays in achieving additional water supply," said Paladin in a statement.

"At the revised anticipated stage three production rates there are currently sufficient ore reserves and stockpiles available to sustain the operation for a minimum of 12 to 13 years with a Run of Mine grade of 800 parts per million uranium oxide," the company further said.

Paladin has estimated it will take between 13 and 15 months to payback the stage three expansion on the basis that production costs remain at, or below, current levels.

The company is planning on further expansion in 2011.