The Paladin Energy Ltd (ASX: PDN) share price is down close to 10% after the ASX mining share gave a painful update.
The business says it’s a globally significant player in the ‘decarbonisation economy’, supplying uranium fuel to nuclear energy facilities across the world.
Rain delays impact Langer Heinrich Mine (LHM)
The company announced to the ASX that operations have resumed at the LHM after the temporary suspension because of unseasonal heavy rainfall in Namibia which was described as a one-in-fifty-year rainfall event.
This has impacted the company’s plans to accelerate the start of mining. This includes the transport of people to the site, restricted feed to the crushers because of the saturation of stockpiled ore, and excess surface water restricting safe access to the processing plant.
While there has been no significant damage to the processing plant, and the miner’s people are safe, there was damage to the access roads and minor civil infrastructure on the LHM site, and there was damage to the haul roads to the mine.
Access to the mine has now been re-established and processing plant operations have resumed. Paladin expects the processing plant to return to normal operations as the in-circuit inventory and chemistry stabilises, and stockpiled ore saturation levels decrease.
The rain has delayed the mobilisation of key mining equipment and personnel to the site, and it led to water entering the open mining puts. Onsite pumping infrastructure is “adequate” to de-water the pits, but access is likely to be delayed. This is delaying the early commencement of mining to access higher grade ore.
All of the above led to the company withdrawing its production guidance for FY25.
2025 production delays
The ASX mining share said it still expects to improve production levels in the second half of 2025 with the blending of iron ore from the open put mines. However, the disruption to the expected start of mining means it doesn’t expect LHM to achieve its projected production of 6 million pounds by the end of the 2025 calendar year.
The acceleration of the mining was a “key initiative” in offsetting the underperformance of stockpile ore and achieving expected production.
Paladin said the LHM team continues to drive operational improvements, progress mining advancements, improve water supply outcomes and deliver strong levels of plant recoveries, which have provided a platform for improving plant production.
The ASX mining share also said the preferred mining contractor, Trollope Mining, has started mobilising mining equipment and the recruitment and training of operators. All mining permits are in place and the blasting contractor has completed mobilisation.
The company said it would provider further details of production in the March quarterly update, to be released in April 2025. I wouldn’t be surprised to see further strong reaction for the Paladin share price on that date.
