Month: May 2011

With the Australian and the global uranium share indexes at a low point it might just be time to buy back into or top up the sector.

But at the moment its far from simple….. ERA and PDN are producers and both have problems and prospects. But when I look at the explorers , in particular the ones with massive deposits like Namibia’s EXT it is hard to get past the nagging uncertainty associated with recent sovereign risk issues. I’ve spent the last week or so looking through the uranium plays and I think (unlike many others) that AEE might be one of the safer plays that has remarkable upside. Many think that our Australian onshore plays are safe… but with the green senate in July how many projects will get a clear pathway to development?

I still hold some EXT, some GGG and more AEE. Hopefully Namibia will act to clear up the resource annexation issues they have raised but until I see a clear statement that they will definitely allow EXT to gain the rights to mine Hsuab I’m going to be very cautious…

You can read why I’m keen on AEE here.

Negotiations between Government and De Beers on the restructuring of Namdeb, effectively giving the State 50 per cent of the interest in all De Beers’s land and sea operations in Namibia, are still ongoing, the international diamond giant has said.

De Beers has held “a long series of negotiations around the future of our diamond mining interests in Namibia”, the company said in an e-mail to Bloomberg on Friday. “These [negotiations] are coming to an end, but we’re not quite there yet,” the e-mail stated.

Locally, Government has been silent on Justice Minister Pendukeni Iivula-Ithana’s memorandum to Cabinet, proposing that a new company, Namdeb Holdings, be created with Namdeb Land and Namdeb Sea as subsidiaries. Government and De Beers will have 50 per cent of the shares each in the new holding company, the Minister suggested in her brief.
http://allafrica.com/stories/201105170571.html

I wonder if we are going to see a tsunami of nationalisation across Namibia and the rest of Africa that may well be as destructive for our Australian uranium companies with African projects as was the recent Japanese event was for Japan’s industries?

All of the Australian uranium plays listed on the overseas exchanges, including, EXT, PDN, BMN etc aren’t looking good and the GURAF is in agreement….

Could be a bargain buying time or a falling knife?

http://australianuranium.com.au/australian-uranium-graph.html

Judging by the market activity in Extract Resources today (up 15%) the Namibian nationalization threat may not be applicable to EXT. However PDN’s fortunes aren’t seen by the market as being all that rosy (down 0.3%). Also today’s “Update regarding possible offer for Kalahari” could have been the positive factor…

According to a story in miningaustralia: http://www.miningaustralia.com.au/news/aussie-miners-wont-be-affected-by-namibias-legis “The Chamber of Mines in Namibia said Minister Katali told the organisation that changes won’t affect existing mine licences.

“Held rights won’t be affected,” a spokesman for the president told The Australian.

“It doesn’t mean the state-owned entity will have a controlling stake…it’s not a form of nationalisation.” Australian-listed miners in Namibia said last week that the government has continued to be supportive of their projects. read full article

But here is the tricky bit: According to 2/5/2011 “Update on Proposed Policy Changes” – Extract is confident that the proposed policy changes will not adversely affect its Exclusive Prospecting Licences (EPL) or its Husab Uranium Project Mining Licence Application (MLA), lodged on 10, December 2010. Now re-read: The Chamber of Mines in Namibia said Minister Katali told the organisation that changes won’t affect existing mine licences.