Cebolleta Project PEA: $84M NPV, 17.7% IRR
Premier American Uranium Inc.'s Cebolleta Project in USA - Cibola County, New Mexico has a Preliminary Economic Assessment (PEA) outlining an after-tax NPV of $84M, an after-tax IRR of 17.7%, and initial capital of $113M. The mine plan runs 13 years at about 1.4 Mlb U3O8 per year.
Premier American Uranium Inc.'s Cebolleta Project has reported Preliminary Economic Assessment (PEA) results for the uranium project in USA - Cibola County, New Mexico. The study headlines an after-tax net present value of $84M at a 8% discount rate. It reflects Premier American Uranium Inc.'s (PUR.V) latest disclosed economics for the asset.
Economics. The after-tax NPV is $84M using a 8% discount rate. After-tax IRR is 17.7%. Initial capital expenditure is estimated at $113M. The study models a payback period of 4.9 years. Economics are based on Base case US$90/lb U3O8 (long-term uranium price of US$90/lb U3O8 used in Mineral Resource estimate).
Production and mine plan. The project envisions an open-pit & underground operation. Life of mine is 13 years. Average annual production is approximately 1.4 Mlb U3O8. Metallurgical recovery averages 80%.
Resources and ownership. The company holds a 100% interest in the project.
These figures are extracted from Premier American Uranium Inc.'s technical disclosures and reflect the most recent PEA on file. Compare this project against other developers and producers in our project economics database, and always verify the numbers against the original technical report before making any investment decision.
Reserves & Resources
| Category | Tonnage | Grade | Contained |
|---|---|---|---|
| Indicated - Underground | 5.89 Mst | 0.15% eU3O8 | 18.14 Mlb eU3O8 |
| Indicated - Open Pit | 3.81 Mst | 0.07% eU3O8 | 5.61 Mlb eU3O8 |
| Subtotal Indicated | 9.70 Mst | 0.12% eU3O8 | 23.75 Mlb eU3O8 |
| Depletion | -1.40 Mst | 0.12% eU3O8 | -3.44 Mlb eU3O8 |
| Total Indicated less Depletion | 8.30 Mst | 0.12% eU3O8 | 20.31 Mlb eU3O8 |
| Inferred - Underground | 1.79 Mst | 0.12% eU3O8 | 4.42 Mlb eU3O8 |
| Inferred - Open Pit | 1.81 Mst | 0.07% eU3O8 | 2.62 Mlb eU3O8 |
| Total Inferred | 3.60 Mst | 0.10% eU3O8 | 7.04 Mlb eU3O8 |
Our Analysis
- IRR after-tax
- 17.7%
higher than 8% of 12 projects we track
- NPV after-tax
- $84M
higher than 21% of 14 projects we track
- Initial capex
- $113M
135% of NPV
costlier than 42% of 12 projects we track
- Payback
- 4.9yrs
slower than 93% of 291 projects we track
- Mine life
- 13yrs
- Discount rate
- 8%
- Study price assumption
- Base case US$90/lb U3O8 (long-term uranium price of US$90/lb U3O8 used in Mineral Resource estimate)
A US$113M initial build against a US$34M market capitalisation is the fact that governs everything else here. The capex is roughly 3.4 times the company's entire equity value, and 135% of the project's after-tax NPV. No nano-cap writes a cheque that size quietly: it means a partner, a joint venture, a streaming or offtake prepayment, or heavy equity issuance, and each path costs existing holders something. This is one of 10 projects the company carries, so the asset is not the sole reason anyone owns the stock, but it is also not large enough to self-fund a build of this scale.
The economics are secondary, and they do not rescue the funding problem. After-tax NPV of US$84M and a 17.7% after-tax IRR rank above 21% and 8% respectively of the 14 and 12 uranium projects we track, placing the return in the bottom quartile. Developers typically need about 15% to attract project finance, and 20% or more where the developer is a higher-risk junior with little else in the portfolio, which describes this company. Payback of 4.9 years sits below 7% of the 291 projects we track across all commodities. The 8% discount rate is a reporting convention, not a hurdle, and carries no signal either way.
Two further caveats compound the financing question. This is a scoping-level PEA, which may incorporate inferred resources and typically carries a capital estimate with a plus or minus 50% band, so the US$113M could move materially in either direction. The study's US$90/lb U3O8 assumption is the base case for the resource estimate, and the returns are sensitive to it: a lower realised price would compress the NPV and the IRR that already sit in the bottom quartile of their peer sets. New Mexico is a familiar uranium jurisdiction, which helps permitting and counterparty appetite, but it does not change the arithmetic. The question that decides this project is not the 17.7% IRR: it is who funds US$113M, and on what terms.
Our take, benchmarked against the project economics in the Mining Stocks database. Figures are estimates drawn from company technical reports — not investment advice; always verify against the source filing.