nuclear-news

Three major companies stepping back from uranium mining

After Fukushima, suddenly the expected darling of local mining investment, has turned into a pariah. Both the Areva and Marenica statements refer to events after Fukushima, highlighting the uncertainty that has entered the industry since the nuclear disaster in Japan……

Perhaps it is a case of both Kalahari Mineral and Extract Resources taking what they can get and opting out of an industry that is fast turning into a lame duck.  [or a dead cat – I haven’t got a picture of a lame duck]

Namibia Economist 16 Dec 11 When three major players in one industry, all announce substantial shifts in strategy and/or focus in a very short span, it signals a fundamental change in the underlying assumptions. These past two weeks saw one surprise after another as first Extract Resources, then Marenica, and finally Areva announced a dramatic turn in their strategies which probably points to a change of heart and a significant reappraisal of prospects and strategies.

………Earlier this week Areva made the announcement that every
informed mining analyst was expecting for some months: The Trekkopje
operations will be shut down. Areva also announced the shut down of
their South American, West African and South African operations. In a
comprehensive statement released only Thursday, Areva says it will
reconsider its entire uranium operation conducted under Uramin. While
the statement is full of legalese and mineralogical terminology, the
message it conveys is that Areva has lost money by the billions and is
forced to reconsider and reconsolidate its financial position before
re-opening any of their uranium operations. The overall tone is
negative.
Marenica released a SENS in Australia on Wednesday echoing much the
same sentiments as the Areva statement. Also convoluted in the
extreme, this statement makes detailed comparisons of the projected
cost per pound of uranium in the ground versus the expected uranium
spot price in the market. By their own assessment, margins appear
marginal, and I gathered from Marenica’s words, they are also taking a
step backward to re-appraise their involvement in uranium exploration
in Namibia.
After Fukushima, suddenly the expected darling of local mining
investment, has turned into a pariah. Both the Areva and Marenica
statements refer to events after Fukushima, highlighting the
uncertainty that has entered the industry since the nuclear disaster
in Japan……
Perhaps it is a case of both Kalahari Mineral and Extract Resources
taking what they can get and opting out of an industry that is fast
turning into a lame duck. I do not know this for a fact but margins in
the uranium industry are certainly under pressure and I believe there
are more people than just myself that have noticed this.

December 16, 2011 - Posted by Christina Macpherson | AFRICA, business and costs, Uranium