Toronto-based First Uranium plans to build a plant to secure future supply of sulphiric acid for its uranium concerns at lower costs, the company said on Monday.

The company has two uranium and gold mining projects in SA, the underground Ezulwini Mine and the Mine Waste Solutions tailings recovery project.

"At a projected cost of US124 million, the acid plant will be installed at Mine Waste Solutions, located in the Western portion of the Witwatersrand Basin approximately 160 kilometres South-West of Johannesburg," the company said.

The company said it expected that it would take 19 months to procure and commission the acid plant with anticipated production beginning in January 2010.

"The company has secured its initial requirements for sulphuric acid in a market where acid supplies remain very tight.

"The company anticipates significant acid price increases that are expected to continue in the medium term, as acid prices are closely related to the market for sulphur which is also indicating tight supply and significant price increases.

The company also said that reduced availability of electrical power in SA had caused cutbacks in the operation of smelters and other facilities that produced sulphuric acid as a by-product.