“AUSTRALIA could drop its ban on uranium sales to India after an international expert panel called for a fresh approach to restricting the world’s nuclear arsenal.”
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Bannerman resources an Nambia Uranium explorer is starting to look very undervalued. It currently has a JORC of 160m pounds and is valued at ~1/10th of uranium in the ground / market cap as compared to EXT. But looking at their latest drilling results it seems more than likely that they rae going to have a JORC = to EXTs or possibly even bigger.
The latest report has a diagram of their projects that indicates a strike length of approximately 10km and up to 3 km wide in places. The grades seem to be good ranging from 3,000ppm to 170ppm and are near surface. BMN is turning into a monster.
If you look at the image that Bannerman has just posted in its latest ASX release you can beging to see the potential.
EXT has a market cap just under $2billion dollars, BMN around $268 million.
From the 2009 Annual report
JORC compliant global resources of 292Mlbs U3O8 (Rossing South + Ida Dome)
Indicated and inferred from Rossing South of 267M U3O8 Jorc compliant plus the company announced an exploration target for areas not included in the current resource estimates. From these additional areas the company had set an initial target in the range of 185-285 Mlb of U3O8.
Again from the annual report: With the new zones of mineralisation emerging our resource target of 500mlbs U3O8 from the current drilling program is within reach.
The image puts it all into perspective:
Lots of stories about BHP’s major accident involving the semi destruction of it main mine shaft by a couple of rogue skips that damaged the lifting mechanism, the overhead fly-wheel as well as the shaft itself are now in the media.
BHP now has to rely on a much smaller secondary shaft to bring mined material to the surface… consequently BHP has declared force majeure – a declaration of not being able to supply to its customers due to circumstances beyond its control.
This coupled with ERA’s problems has lead to a situation where emerging uranium producer Paladin has risen markedly. Another likely to benefit is Australia’s Extract ASX:EXT that is proving up a multimillion pound deposit that some say will reach 500m pounds of uranium at quite exciting grades in Namibia. Paladin is of course just about to produce substantial uranium and consequently well placed as seen by its share price rise over the last few days.
Namibia is a uranium hot spot with several Australian compnaies having major uranium prospects and projects underway. These include BMN, TOE, EXT, DYL.
Below is a story from Reuters….
Uranium miners’ shares leap on Olympic Dam force majeure
By Cameron French of Reuters
TORONTO – Shares of uranium producers have raced higher, as an apparent declaration of force majeure at the massive Olympic Dam mine in Australia suggested uranium prices could jump.
Shares of Canadian uranium major Cameco Corp climbed more than six per cent, while those of other international producers climbed between seven per cent and nearly 10 per cent.
According to The Australian newspaper, mine owner BHP Billiton plans to advise copper and uranium customers the mine will be down for an extended period because of damage to equipment at the main shaft earlier this month.
The mine produces about 4,000 tonnes of uranium annually, which accounts for a bit less than 10 per cent of global mined production. The damaged Clark shaft handles about 80 per cent of Olympic Dam’s production capacity.
Such a loss of production would be expected to drive up prices in the thin uranium spot market as BHP’s customers would have to seek alternative sources of supply.
“It looks like the market’s assuming the worst,” said Simon Tonkin, an analyst at Thomas Weisel Partners Canada.
Weekly spot prices UX- were last calculated at $US46 a pound, according to Reuters data.
Late in the session, Cameco shares were up 6.7 per cent at $C32.48 on the Toronto Stock Exchange, after touching a year high earlier in the session.
Australian-based Paladin Energy was up 9.7 per cent at $C5.10 on its Toronto listing, while Uranium One , which is focused in Kazakhstan, rose 7.5 per cent to $C3.31, and Denison Mines surged eight per cent, to $C1.90.
In the options market, the volume on Cameco was six times the average daily turnover with about 16,000 call options traded at mid-afternoon. This was seven times the number of its puts, according to option analytics firm Trade Alert.
Call options let investors buy a company’s shares at a fixed price within a specified time period, while put options are options to sell.
BHP is expected to provide an update on damage to the mine on Wednesday in Australia.
In addition to the uranium production, analysts have estimated the global copper market stands to lose up to 50,000 tonnes of supply this year due to the incident.
This has been a wonderful story and it seems to be getting better all the time.
Excerpt from today’s Miningenews.net
Extract grows Rossing South again
Thursday, 2 July 2009
EXTRACT Resources has increased the resources at its flagship high-grade Rossing South project by 34% to 145 million pounds of uranium, firming the deposit’s position as one of the biggest new uranium discoveries in the world.
It has been a tough year for the company with corporate raids from the United Kingdom and an attempted board ousting that has ended with managing director Peter McIntyre resigning from his position.
Despite the boardroom drama, Extract has continued to push ahead with exploration at its flagship Rossing South project.
The resource upgrade announced today has upped resources at Rossing South to 145Mlb of uranium at a grade of 449 parts per million uranium.
The overall estimate includes an indicated resource of 21 million tonnes at 527ppm uranium for 24Mlb uranium, and an inferred resource of 126Mt at 436ppm uranium for 121Mlb uranium.
Perth-based Extract said Rossing South was proving itself as the highest-grade granite-hosted uranium deposit in Namibia.
The next step for the company is to define a resource at the Zone 2 area, with the resource due in August.
The project has attracted a great deal of interest, with Rio Tinto buying into the company last year, and the corporate drama from UK companies Kalahari Minerals and Polo Resources proving Extract has attracted a lot of attention.
(IMO BMN will soon be shown to have a similar resource.)
Well-known and highly regarded throughout the mining and exploration community, Mercenary Geologist Mickey Fulp:
“MF: The demand is there. The mined supply every year is somewhere around 110 to120 million pounds. The current world demand is somewhere around 160 to 170 million pounds. So in terms of mine production, the world is at a one-third shortfall on a yearly basis. Over the last few years, these shortfalls have been supplied in large part by the Russians and their “Megatons to Megawatts” program, which converts highly enriched weapons-grade uranium into low-enriched uranium suitable for reactors. The Russians have stated publicly that sales to the U.S. are going to end in 2013. Currently, the U.S. uses somewhere around 55 million pounds of uranium per year and produces less than 4 million pounds. The demand obviously is there. We have not built a nuclear reactor in the U.S. for years, but we have increased the efficiency and increased units within our existing nuclear power plants, so that our demand has been going up. As an energy supplier, uranium is just about as green as you can get. It leaves no carbon footprint. It’s safe. The Three Mile Island scare was media-driven hype, and we all realize that now. Increasingly, the green sector is looking at nuclear energy as a viable, clean, alternative source in the United States.”
Read more at http://www.uranium-stocks.net/mickey-fulp-mercenary-geologist-the-demand-is-there/#more-1001
Nice to see someone of Bromby’s calibre plugging uranium’s prospects….
Uranium surprise coming
Robin Bromby | June 01, 2009
Article from: The Australian
WITH all the reports of China stockpiling metals – copper, for example – it’s surprising that speculators haven’t been thinking about what would happen to prices of certain commodities if the stockpiling effort was extended to them.
Uranium, for example.
Warwick Grigor, in his latest client note out of BGF Equities, wonders out loud what would happen if China chose to begin stockpiling uranium for its rapidly expanding nuclear power sector. With uranium one of those markets that are already tight in terms of supply, and being a strategic mineral as well, uranium stands out to Grigor as the obvious market for investors to watch. If China were to make such a move, he writes, “then it would be smart to get set before it commences this strategy”.
Excerpt: “Global portfolio flows indicate that among mining stocks, listed uranium names have been in strong demand over the past few months, third among mining subsectors only to specialist miners of nickel and zinc. One catalyst has come by way of spot uranium prices, moving up over the past month or so, reversing a longer term downward trend, and more recent one in place since December. ” Read article
Long-term uranium demand strong: ERA
20/03/2009 4:27:01 PM
Energy Resources Australia Ltd (ERA) says long-term demand for uranium is likely to remain strong with China to drive demand growth in the next decade.
The yellow cake miner also says it is well positioned to take advantage of the robust market for uranium with projects in 2009 to increase production capability.
Uranium has not been subject to as severe a downturn in demand and prices that has beset the market for many other mineral commodities, ERA says in its annual report released on Friday.
“As market prices have risen, the long term fundamentals for the uranium market remains strong,” ERA said.
“Overall, the supply and demand balance in uranium markets point to sustained higher prices in the medium term,” the company said.
ERA concluded its first sale of uranium to China last year and says that country will drive demand growth for its product.
“The most significant growth in demand for uranium in the next decade will come from China.”