One of the world’s largest undeveloped uranium deposits, NexGen Energy’s flagship Arrow uranium deposit, saw a significant bump in its indicated mineral resources, thanks to a new pre-feasibility study.

The deposit, located in Saskatchewan’s Athabasca Basin, will also generate a higher net value, according to the Monday study, conducted by Wood Group, Roscoe Postle Associates and other sub-consultants.

The study based its findings on a long-stope mining method and resulted in significant increases of several important factors when compared to the deposit’s Preliminary Economic Assessment (PEA), conducted in July, 2017.

The study showed a 43 per cent increase in Arrow’s indicated mineral resources. The deposit contains an estimated 2.89 million tonnes of triuranium octoxide (U3O8), a uranium compound, compared to 1.18 million tonnes of U3O8 in 2017. Additionally, the average annual grade of the uranium increased 79 per cent, to 3.09 per cent, up from 1.73 per cent previously .

The study showed an increased value of the deposit, at $3.7 billion – up from $3.49 billion –  and a higher average annual net cash flow of $909 million, up 64 per cent from 2017.

Lateral and vertical development of the project was reduced significantly due to a combined fresh air raise and production shaft, which will help to limit the deposit’s environmental footprint.

Related: NexGen Energy, Arizona Mining among mineral exploration leaders recognized at PDAC 2018

NexGen said it will move toward initial production. The company said it expects the demand for uranium and nuclear power will greatly expand due to the need for environmentally friendly energy and the increased demand for electric vehicles, but that uranium production worldwide is not capable of meeting the upcoming demand.

“The uranium market outlook shows us the supply deficit has commenced already and will dramatically widen early in the 2020 decade, even with current production levels and potential mine developments,” NexGen president and CEO Leigh Curyer said during a conference call. “Hence at a production profile of 25.4 million pounds annually for Arrow, the world clearly requires more than one Arrow. There's currently one billion pounds of un-contracted demand over the next decade, with the majority of contracts expiring in the next couple of years.”

At the indicated annual production of 25.4 million pounds, Arrow would make NexGen the second largest uranium producer in the world, generating 21 per cent of the world’s supply. Kazatomprom, a Kazakhstan uranium miner, is the only company with higher production, at 27.5 million pounds produced annually.

NexGen has said that it will initiate a stage two high-intensity drilling program at Arrow, which is expected to commence in early December.