(Ecofin Agency) - Demand and prices for uranium have been on the rise for several months, amidst a resurgence of interest in nuclear power. Companies that had halted production or slowed uranium project development in recent years are now rushing to take advantage of this resurgence.

Australian mining company Lotus Resources announced on February 23 a stock placement aiming to raise 30 million Australian dollars ($19.7 million) for reviving its Kayelekera uranium mine in Malawi and developing its Letlhakane uranium project in Botswana.

Lotus will use the funds to conduct an engineering study to confirm the initial capital estimate needed to rehabilitate the Kayelekera project and secure new equipment. The study will also update operating costs and validate the restart timeline, currently set at 15 months.

The firm should also appoint a debt advisor to help with the revival. A 2022 feasibility study notes that $88 million is needed to restart production at Kayelekera. Lotus aims to resume production in Q4 2025 to take advantage of positive prospects for demand and prices for nuclear fuel.

The firm plans to carry out an exploratory study at the Letlhakane mine in Botswana. The study aims to identify a more efficient processing method than that of the 2015 feasibility study, to improve the economic characteristics of the project. An updated estimate of mineral resources is also expected to be released in the second quarter of 2024.

"Our main priority remains advancing the plans to restart Kayelekera to benefit from increased demand for Kayelekera products and current high and rising uranium prices, but we also recognize that progressing quickly at Letlhakane will enhance the company's assessment," commented Keith Bowes, CEO of Lotus.

As a reminder, the production target at Kayelekera is 2.4 million pounds per year over the first seven years of the mine, with an estimated total lifespan of 10 years. The Letlhakane project, which entered Lotus's portfolio in 2023 through the merger with A-Cap Energy, could deliver annually 3.75 million pounds of uranium over an 18-year lifespan.

Emiliano Tossou