American mining firm Denison on Thursday announced that it will start its uranium mining project in Zambia in 2012 once prices of the metal on the London Metal Exchange (LME) picks up.

The Zambian government granted Denison two large-scale mining licenses for uranium mining in 2008. The company however has been exploring for uranium ore in southern Zambia for the last five years.

The company's project director for Africa Andrew Goode said that the company is likely to start its first production of uranium in 2012 and anticipates a recovery in the prices of the commodity.

Uranium prices are currently at 105.82 U.S. dollars per kilogram on the international market.

The official said the project has been delayed because of the continued low prices of uranium on the market.

"We are going to start production when the economics is right because if we start now we will be producing at a loss as we have invested a lot of money on this project," he said.

The company has projected to employ 430 people and at full production, its Muntanga open pit should produce an estimated 1.5 million pounds of uranium per year.

The firm has three operating mines and two uranium mills in north America with assets in Canada, the United States, Zambian and Mongolia.

Capital expenditures for the Zambian project are estimated to be more than 100 million dollars with the yearly operating costs reaching 40 million dollars.