The Indaba is good chance to run comparative tests
WITH URANIUM currently all the rave, the Mining Indaba provides fertile ground to compare southern Africa’s three most influential uranium producers: sxr Uranium One, First Uranium and Paladin Resources. All are attending.
The price of uranium is expected to push through US$100/lb this year. Compare that to the $20/lb level of around three to four years ago. A combination of poor exploration, exhausted inventories and the growing interest in alternative energy has helped improve demand for the metal.
According to Resource Capital Research, the market valuation of Canadian uranium juniors was up 143% last year and 186% for their Australian counterparts. Therefore, Uranium One’s 140% performance on the JSE was “average” for its sector and an argument could be made that the counter will continue to track its peer group.
The price of uranium is expected to push through $100 per pound
By the time this is published, Uranium One should have started production from its Dominion One mine. The miner, which recently joined Uranium One on the Toronto Stock Exchange, is still gathering information on its resources. Paladin Resources, operating in Namibia, has arguably the most advanced projects in southern Africa.
Paladin Resources’ Langer Heinrich Uranium project in Namibia is producing uranium and a bankable feasibility study is nearing completion for its Kayelekera project in Malawi. It also recently bought Valhalla Uranium.
Converting from exploration into production means a lot to uranium hopefuls, as it provides an important uplift in share ratings. Uranium One hopes to start matching Paladin Resources. Merely inhabiting the uranium market generates value, as First Uranium saw when it was able to raise $203m at its Toronto debut. Key issues for southern Africa’s uranium producers will therefore be: • Improving their resources base. • Becoming a producer or near-term producer as quickly
as possible. • The ability to compete in the merger and acquisition mar-
ket. • Remaining low-cost to stay competitive when the supply
deficit narrows in years hence.