Uranium bull market reinforces Tournigan Energy's uranium push in Europe

Uranium bull market reinforces Tournigan Energy's uranium push in Europe

tournigan.com 604.551.2360

Dorian L. (Dusty) Nicol

President & CEO

The recent steady rise in the price of uranium indicates the strong fundamentals in the uranium market from which Tournigan Energy Ltd (TSXV: TVC) stands to benefit. Tournigan is a uranium exploration and development company that has built a portfolio of highly prospective assets in Slovakia, the third largest per capita user of nuclear power in the world. Worldwide, there are 440 nuclear reactors in 30 countries, about 60 new reactors are being built 27 in China alone and 150 are planned while another 340 are proposed. President and CEO Dusty Nicol discusses how this scenario bodes well for this advanced-stage pure-play uranium company.

Resource Intelligence: Tournigan is developing one of Europe's most significant uranium deposits. Could you give investors a sense of how significant the Kuriskova deposit is?

Dusty Nicol: Outside of Canada, the Kuriskova deposit is one of the highest-grade uranium deposits in the world. The most recent resource estimate reported 20.5 million lbs U3O8 indicated at 0.571% U3O8 and an additional 17.5 million lbs U3O8 inferred at 0.228% U3O8. Currently at the pre-feasibility stage, we're continuing our drilling to bring more of the inferred resource to the indicated level.

RI: The deposit has been described as a "unique" high-grade underground resource. What makes it unique?

DN: It's unique in that it is sizable, advanced, high grade and, because of the high grade, ideal for economic underground mining at uranium prices much lower than today's spot prices. Outside of Canada, there's nothing really like it.

RI: How is Slovakia as a jurisdiction?

DN: We've been in Slovakia since 2003 and found it an ideal place to work. As a member of the EU since 2004 it is stable, has an excellent infrastructure and a skilled, educated workforce. From an exploration and mining perspective, Slovakia's standards are modeled on those of Canada and Australia. Its environmental policies are transparent and set to stringent EU standards. With regards to mining, over 4.5 million tons of coal are mined in Slovakia yearly. Other significant minerals include iron, copper, lead, manganese, zinc, mercury and lignite. While Tournigan is the leader in uranium exploration in Slovakia, there is currently an operating uranium mine at Dolni Rozinka in neighbouring Czech Republic, producing about 300 tonnes U3O8 per year.

RI: Slovakia is the world's third largest per capita user of nuclear energy worldwide. Since there is no uranium production there at the moment, do you see Slovakia as the main end-user of your production?

DN: Nuclear power represents about 50% Slovakia's energy supply. They currently have four operating reactors and are now building two more with plans for additional capacity to 2030. About 25% of our estimated production could potentially fuel Slovakia's nuclear reactors for 15 years. It's too early to determine how this may fit into Slovakia's energy policies though it seems an obvious fit.

RI: When do you expect to start production? Is it the most advanced among new potential suppliers?

DN: Possibly as early as 2015, given the drilling, economic and environmental studies, the permitting process and the construction timeline. We consider this "advanced" because there are very few sizable uranium deposits in the world that are at the pre-feasibility stage.

RI: What is your production target per year?

DN: Our PEA released in July 2009 reported annual production at about 1.4 million lbs per year, 2.4 million lbs in the first five years. With the additional high grade included in the upcoming pre-feasibility, we expect future studies to show higher annual production and lower costs per pound over the life of the mine.

RI: What opportunities do you see in theuranium market?

DN: Leading uranium analysts are now saying that today's supply/demand fundamentals warrant a very real uranium bull market. On the demand side, about 60 new reactors are currently being built, 27 in China alone, 150 are planned and another 340 are proposed. This is in addition to the 440 operating reactors now installed in 30 countries. The supply side has been affected by depleting secondary sources, production shortfalls by current producers and production delays for greenfield projects. We are a leader among a handful of uranium deposits in Europe with close proximity to enrichment facilities in France and Russia.

RI: What value does your company immediately provide to investors?

DN: Now that we've divested all of our non-core assets, we offer an advanced-stage undervalued pure uranium play, operating in a safe, nuclear-energy-producing jurisdiction with excellent infrastructure.

RI: Why invest in uranium projects and why Tournigan in particular?

DN: The supply/demand fundamentals for the uranium market are very real. That said, as investors come back to a commodity, they start with the jurisdictions they know. Many of these uranium plays have already had a good run in their value. As a sector builds momentum, investors start looking for undervalued opportunities but demand a quality asset, sound management and a stable jurisdiction. We meet all of these criteria.

RI: What are your priorities for this year?

DN: There will be ongoing work towards pre-feasibility at Kuriskova as we expect to see a revised resource estimate by the third quarter. We will also be resource drilling at the Novoveska Huta deposit, 65 km west of Kuriskova, and expect to publish an NI 43-101 resource estimate on that deposit later in the year. The resource drilling, which has the potential to add pounds in the ground, and additional work on other licenses, will provide a steady flow of news throughout the year.

Investor Highlights:

The cash cost in the first five production years at Kuriskova is among the lowest at less than US$17 per lb U3O8

The project's NPV is $135 million at a 12% discount rate using a $65 U3O8 price, lower than the current spot price

Ongoing resource drilling at Kuriskova and Novoveska Huta deposits has potential to add additional pounds U3O8

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