Mine trucks: transport economics?

There are around 50,000 giant mining trucks in operation globally. The largest examples are around 16m long, 10m wide, 8m high, can carry around 350-450 tons and reach top speeds of 40mph.

This data-file captures the economics of a mine haul truck. A 10% IRR requires a charge of $10/ton of material, if it is transported 100-miles from the mine to processing facility. Assumptions can be stress-tested overleaf.

Fuel consumption is large, around 40bpd, or 0.3mpg, comprising around 30% of total mine truck costs at c$1.5-2/gal diesel prices. Some lower carbon fuels are c5x more expensive, and would thus inflate mined commodity costs.

High utilization rates are also crucial to economics, to defray fixed costs, which are c50% of total costs, as our numbers assume each truck will cover an average of 500 miles per day for c20-25 years.

Uranium mining: the economics?

This simple model aims to disaggregate the marginal costs of a new uranium mine, as a function of uranium prices, ore grade, capex and opex. Our base case is a marginal cost of $60/lb for a 10% IRR. However, lower ore grades can easily require $90/lb uranium prices in order to justify investment. Cash costs range from $7-40/lb.

Uranium mining: company screen and market outlook?

We have screened c20 uranium miners, assessing each company’s production, reserves, asset base, size and recent news flow. 10 of the companies are publicly listed, while the remainder are private or state-owned.

Our market outlook is that firm uranium supply may be running 25% short of the level required on our roadmap to net zero.

Headline supply-demand forecasts are also presented in the data-file, along with notes and CO2 intensity calculations for the sector.

Copyright: Thunder Said Energy, 2022.