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Collapses uranium market forces Australian company Paladin to cut back

Paladin freezes expansion Financial Review 08 NOV 2012 Uranium miner Paladin Energy  will slash costs by up to $US80 million ($76.97 million) after putting a freeze on development due to the weak uranium price.

Paladin will cuts costs by between $US60 million and $US80 million in fiscal 2013 and 2014, after undertaking an extensive review of costs and production.

The “optimisation exercise” had now become even more relevant due to the spot price, the company said in a statement on Wednesday. But the company did not reveal whether significant job losses would be forthcoming. Chief executive John Borshoff said he would make an
announcement about jobs later and predicted the uranium price would
plateau in the short term before picking up in the mid-term.

“Today the price is not justifying any development and everybody
realises that, even with development, there’s a supply crisis moving
forward,” he said….. In a statement, Paladin said it would require a
sustainable uranium price at, or above, $US85 per pound to warrant any
further expansion or new mine development….. Paladin shares closed
1.5¢ lower at $1.05, having plummeted nearly 80 per cent since the
Fukushima nuclear disaster in Japan led to reduced demand for uranium.

Paladin’s annual general meeting will be held in Perth on November 22.
http://afr.com/p/business/companies/paladin_freezes_expansion_QLqpvyWEsCOgp3Gt0woutJ

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November 9, 2012 - Posted by | AUSTRALIA, business and costs

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