The company behind Australia's first uranium mine in a decade has been hit by a huge share-price plunge after disclosing challenges at its South Australia operation.
Boss Energy shares on Monday afternoon were down 42.2 per cent to a three-year low of $1.965 after the Perth-headquartered company made the announcement about its Honeymoon mine, 80km northwest of Broken Hill.
Boss said that based on more than 12 months of resumed operations, it had identified "potential challenges" that could prevent Honeymoon from ever achieving its forecast production target of 2.45 million pounds of yellowcake a year.
"We're confident that we'll get at least 1,600,000 pounds," chief executive and managing director Duncan Craib told analysts in a conference call on Monday.
The issue is production drilling at 15 to 20 metres of spacing has found less uranium mineralisation than Boss had inferred from its 2021 feasibility study, which relied on drilling at 60 or 70-metre spacing.
An independent review by experts will commence shortly to determine the extent to which this will affect assumptions from the early feasibility study, Boss said.
The Honeymoon mine opened in 2011 but operations were suspended just two years later, after a plunge in the price of uranium.
Boss bought the mine in 2015 and it resumed operations in 2024.
"It really has been a tremendous achievement that since the start of commissioning in April (2024), we've produced over one million pounds of uranium to date," Mr Craib said.
The chief executive, who is stepping down at the end of September, told analysts in response to a question that it was too soon to say how the mineralisation findings might affect Honeymoon's estimated mine life of 10-plus years.
"The mine itself is off to a flying start," he said.
It is profitable and Boss Energy has no debt, he added.
