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(Kitco News) - Previously touting a hybrid open-pit and underground uranium mine, Fission Uranium (TSX:FCU) has come out today with a new prefeasibility study envisioning an underground-only scenario for its Patterson Lake South Property with a lower capital cost.

Fission said the new prefeasibility study shows a substantially reduced capital expenditure and time requirements for construction of the Triple R mine due to "simplified water control measures for underground mining."

The company estimates a reduction in capital costs from C$1.50 billion to just C$1.18 billion for its new underground-only PFS. Time to build would also be reduced by one year, down to a total to three years.

The mine would have a seven-year production life.

The average unit operating cost is US$7.18/lb U3O8. The pre-tax economics show an IRR of 34%, a NPV at 8% of $1.33 billion. The payback will be 2.2 years.

Ross McElroy--president, chief operating officer and chief geologist for Fission--commented in a news release.

"This prefeasibility report presents an underground-only method for production at PLS as an alternative to the hybrid base case, which combined underground with open pit mining. The report highlights important potential advantages to the underground approach, including large reductions in capital expenditure, construction time and surface footprint, while still enjoying low operating costs and a very strong return on investment. We are delighted by the results and have demonstrated the flexibility of the Triple R to be mined by multiple methods. Fission is now able to transition confidently into the feasibility study phase."