Australian news, and some related international items

Doubts on whether ERA’s Ranger 3 uranium mine can go ahead

Technical hitches bedevil ERA’s Ranger mine by: Matt Chambers The Australian July 12, 2014   URANIUM producer Energy Resources of Australia could face more problems at its Ranger uranium mine in Kakadu National Park, flagging potential higher costs that Credit Suisse says could stop a planned underground ­expansion.


The Darwin-based Rio Tinto subsidiary said its Ranger 3 Deeps exploration decline project was experiencing tougher than expected geotechnical conditions. “Some geotechnical conditions have been encountered that are less favourable than assumed,” ERA said in its June quarter report, released on Thursday.

“These findings are being factored in to the mine design and the pre-feasibility study.”

While the market was little moved by the report on Thursday, Credit Suisse analyst Matthew Hope saw red flags.“We believe the results of the Deeps resource drilling are poor,” Mr Hope said yesterday in a note to clients.“The rock is probably heavily fractured, so extensive rock bolting and meshing will likely be required to prevent the access drives from collapsing,” Mr Hope said.

Credit Suisse downgraded its rating on ERA from outperform to underperform, and cut its target price by two-thirds from $1.50 to just 50c.

Mr Hope said value in ERA was almost entirely based on whether Ranger 3 Deeps would be mined. “If ERA announces at the end of this year that Ranger Deeps is not viable, then the share price should collapse to very low levels, with only option value remaining,” he said.

“Ranger Deeps either adds value or there is close to none, and risks are increasing towards the latter.”Ranger shares slipped 0.5c to $1.16 yesterday, giving the company a market value of $600m.

July 12, 2014 Posted by | business, Northern Territory, uranium | Leave a comment

Costly problems, legal battles, face owners of Four Mile uranium mine

radiation-sign-sadFour Mile mine opens amid tensions between owners, World Nuclear News, 26 June 2014 The Four Mile uranium mine in South Australia was officially opened on 25 June, but its minority owner wants to sell its stake and is preparing a legal battle against the project operator…….EdwardSterck, a senior mining analyst at London-based BMO Capital Markets, said he did not think there was “any huge significance” in the opening of Four Mile. “It appears that they are using the existing Beverley plant which suggests that production from Four Mile is replacing production at Beverley,” Sterck told World Nuclear News.

Quasar Director Dave Roberts said there is remaining ore at the Beverley mine that “can and will be” extracted at a future point in time. “But today, we are dedicating the full processing capacity of Beverley to the production of Four Mile uranium,” Roberts said during TV coverage of the opening ceremony.

ACE’s parent company Melborne-based Alliance Resources announced last week it had appointed Deloitte Corporate Finance to lead the sale of its 25% stake in the project. Alliance said the sale would “free up funds” for the company to develop its exploration portfolio.

In the meantime, the court case is looming for ACE’s 2010 filing against Quasar Resources – on the basis of “misleading and deceptive conduct” – having been set for 30 June.

ACE has said it is “seeking restitution for the 75% interest in the exploration licence for Four Mile, citing, among other issues, Quasar’s failure to disclose information relating to the prospectivity of part of the tenement.” ACE also contends that Quasar, “with the assistance or participation of” its affiliate Heathgate Resources, breached its obligations under the joint venture agreement……..

ACE said in January it had elected to vote against Quasar’s revised start-up plan for the Four Mile project, which would see uranium capture at Heathgate’s Pannikan plant, and precipitation, drying and packing at Heathgate’s Beverley processing plant. ACE said the parties should instead construct a stand-alone plant at Four Mile in order to reduce operating costs. Heathgate Resources, which like Quasar is based in Adelaide, is the owner and operator of the Beverley uranium mine in the Northern Flinders Ranges.

First discovered in 2005, the Four Mile uranium deposit is 550 km north east of Adelaide in the Frome Basin. State and federal regulators approved the mining lease for the project in April 2012 and more than AUD 120 million ($113 million) has been invested so far, the government said. The mine’s owners expect to produce up to 1.6 million pounds from the mine this year, it said.

June 28, 2014 Posted by | business, legal, South Australia, uranium | Leave a comment

Japan’s plans to restart nuclear reactors – not likely to save Paladin

graph-down-uraniumJapan to restart nuclear reactors: Will it save Paladin Energy Ltd? By  – June 23, 2014 Plans to restart at least two of Japan’s 48 nuclear reactors could have positive implications for the price of uranium and deliver a boost to ASX-listed uranium miners, including Paladin Energy Ltd (ASX: PDN).

According to The Diplomat, Japan’s Nuclear Regulation Authority (NRA) is about to begin safety inspections on at least one power plant. Japan’s nine nuclear power companies all have plans to restart their nuclear reactors.

But with 58% of Japanese people opposing any restart, and 59% opposing the use of nuclear energy to kickstart economic growth, the government and the energy providers will have their work cut out for them. The issue for Japan is that meeting peak summer energy demand without the nuclear power plants is going to be tough.

Uranium prices have crashed since the Fukushima incident in 2011, losing a further 30% in the last year to hit US$28.15 a pound. That’s well below the cost of production for most uranium miners. And in the short to medium term the outlook is not good, with RBC Capital Markets Analysts forecasting a price of US$31.50/lb this year and US$40 for 2015. But RBC has slashed its forecasts for 2016 to 2018 to between US$40 to US$45/lb, amid expectations that the uranium market will be in surplus until 2021.

Paladin’s cost of production in the last quarter at its Langer Heinrich mine stood at US$29/lb – and that’s not the all-in sustaining cost. The company was forced to place its other main mine Kayelekera mine on care & maintenance, with its production cost running at US$32.90/lb in the last quarter.

So it appears that the tough times will continue for Paladin and other ASX-listed uranium miners, including Energy Resources of Australia Limited (ASX: ERA) – which is majority-owned by Rio Tinto Limited (ASX: RIO). Investors may want to skip the uranium producers for now.

June 24, 2014 Posted by | AUSTRALIA - NATIONAL, business, uranium | Leave a comment

Energy Resources of Australia – uranium company expecting an even huger loss this time

Energy Resources of Australia expects loss By Ross Kelly  SYDNEY–Uranium producer Energy Resources of Australia Ltd. expects a first-half loss of up to 140 million Australian dollars (US$130 million) after a radioactive leak halted activities at its Ranger operation in the Northern Territory.


The company, which is 68% owned by Rio Tinto PLC, said it expects to restart operations at Ranger progressively beginning Thursday after cleanup and regulator approval.

The leak of about 1 million liters of contaminated slurry, which occurred in December, was caused by toxic material eating through a steel tank involved in the process of refining ore. Investigations by authorities found the leak was contained within the mine site.

The company had already stopped mining uranium at the Ranger operation in late 2012 after its ore was depleted. But it continued to process stockpiled ore while it studied the feasibility of digging a new underground pit there called Ranger 3 Deeps.

The company expects a loss of A$120 million and A$140 million for the six months through December, in large part due to costs associated with the suspension of ore processing. That compares to a A$53.4 million loss in the year-earlier period.

Energy Resources of Australia has run up a string of losses in recent years, dogged by low uranium prices, disappointing output volumes and costs associated with the rehabilitation of the old mine site.

June 6, 2014 Posted by | AUSTRALIA - NATIONAL, business, uranium | Leave a comment

The collapse of uranium company Paladin’s share price

graph-down-uraniumWhy the Paladin Energy Share Price Fell Today What Happened to the Paladin Energy Share Price? Shares of Paladin Energy [ASX:PDN] fell by 3.95% on Wednesday, closing at 36.5 cents. This was the lowest closing price in nearly 10 years of trading! , Money Morning 5 June 14 

Why Did This Happen to the Paladin Energy Share Price?

Paladin Energy Limited is a uranium production and exploration company with projects currently in Australia, Canada, and Africa. The Langer Heinrich mine in Namibia is its flagship project.

Since the Fukushima uranium plant meltdown in 2011, the uranium industry has never been the same. Following this event, the Japanese government turned off all of its 54 uranium power plants.

The uranium spot price is now trading at around US$28.25 per pound, a level not seen since April 2005. Certain estimates now place up to 60% of current annual global production with costs above the current spot price, which is unsustainable.
For years, Paladin experienced financing, production, and profitability issues. And last week it officially temporarily closed its Kayelekera mine in Malawi.

For this plant to restart operations, Paladin wants to see a uranium price between US$70–75 dollars per pound, which implies that the breakeven price for Kayelekera is significantly above the current spot price. Overall the share price is declining because of a poor uranium environment. Last week, Japan announced that it won’t restart any reactors during 2014 — something that uranium punters were betting on.

June 5, 2014 Posted by | AUSTRALIA - NATIONAL, business, uranium | 1 Comment

Uranium company gives up – switching to property development

fearuranium-oreUnited Uranium Limited moving from resources exploration to property development United Uranium Limited moving from resources exploration to property development June 02, 2014  United Uranium Limited moving from resources exploration to property development

United Uranium Limited (ASX:UUL) is exploring opportunities that will most likely result in a shift away from resources exploration to property development in a bid to increase shareholder value.

This follows completion of a strategic review that identified the unwillingness of the investment community to invest in junior resources companies, particularly those focused on uranium.

It added the early stage status of its projects required significant funding to explore, with no guarantee of commercial success.

These add to the continued depressed uranium prices, and commodities prices in general.

In contrast, it noted that investors were willing to invest in property developments with the sector currently experiencing strong housing demand.



June 3, 2014 Posted by | AUSTRALIA - NATIONAL, business, uranium | Leave a comment

Permanent gloom for the uranium industry – the crisis is terminal?

We are heading for a uranium crisis , Investor Intel,  June 2, 2014 by “……Welcome to the “perma-gloom” with spot uranium now at $28.25/lb. But it really does portend a very troubling situation. We could be on the brink of a real uranium crisis, one that could have serious ramifications down the road. This is because, on top of all the doubts about nuclear post-Fukushima and the slowness of Japan to get reactors back on line, uranium is caught up in the general malaise affecting the mining industry ……….the uranium price has fallen by 30% over the past year. If it keeps falling, and it well might, more and more companies will either go into hibernation mode or quit the sector all together ……..


A surer sign that all is not well can be evidenced from an ominous trend — exploration companies quitting the sector. Others are making cuts: Cameco closed its Cheyenne office, while BHP Billiton has deferred its expansion at the world’s biggest uranium deposit, Olympic Dam in South Australia. Australia’s Paladin Energy (ASX:PDN) has put one of its mines, Kayelekera in Malawi, on care and maintenance.

Back in 2007-8, after spot uranium hit $137/lb, this was the place to be. Suddenly every mining explorer was keen to be in the uranium hunt. At one stage, more than 260 companies listed on the Australian Securities claimed to have uranium projects (many of them in what the Canadian miners call “moose pasture”).

Now, it seems, those small number remaining can’t wait to get out. FYI Resources (ASX:FYI), which got into uranium after quitting the eye care business (it’s previous name was Freedom Eye) in 2009, is now concentrating on potash in Thailand. Uranex (ASX:UNX)  is staying in Tanzania, but has put its uranium on the back-burner in order to pursue graphite.

But possibly the most startling change was reported today. Junior United Uranium (ASX:UUL) which has six projects in Western Australia [and A$3.41 million in the bank as at March 31] is getting out of uranium and into — wait for it — property development.You can’t exactly blame the directors. The shares are trading at a discount to the company assets (the market capitalisation being just A$2 million), all its projects are early-stage ones that will require considerable sums to explore and may not turn out to be viable, no one is investing in the sector, the uranium price is depressed as is the resource sector generally.

Just two weeks ago another uranium explorer working in Western Australia, Prime Minerals (ASX:PIM), signalled it was changing direction. It is merging with Cocoon Data Holdings which has data security software. The news lifted Prime’s stock from A0.9c to A2.2c.

Back in 2007, announcing you were getting into uranium could see your stock price double. Now announcing you’re switching focus away from uranium does the trick. This is not a good trend.

June 3, 2014 Posted by | AUSTRALIA - NATIONAL, business | Leave a comment

Investors flee as uranium price collapses even further

graph-down-uraniumA uranium price collapse has made mining companies radioactive to investors, Quartz By Jason Karaian   May 28, 2014 Here’s the latest sign that uranium-mining doesn’t pay: Paladin Energy, an Australian uranium mining group, announced today that it was ceasing production(pdf) at a key mine in Malawi. The move will take 3.3 million pounds of uranium per year off the market.

Paladin blames the plunge in the market price for the commodity, which has been languishing below $30 per pound, down from a peak of around $140 per pound in 2007:……..

Paladin is far from alone. As uranium prices have tumbled, others have been feeling the pinch. Indeed, for some 60% of global uranium production, the cost of extraction is higher than the market price for the commodity, the firm says.

In 2012, BHP Billiton put off a $20-billion expansion plan for a mine that sits on the world’s largest known uranium deposit. The prospects for processing more yellowcake at the site still look dim, given depressed prices. Yesterday, the French nuclear group Areva signed a uranium mining deal with the government of Niger, the world’s fourth-largest producer, but immediately put the start of the project on hold until prices improve. “Neither Areva nor Niger are interested in dumping uranium on the market that would not find a buyer,” Areva boss Luc Oursel said.

Uranium prices have been hit by a series of setbacks in recent years, from a global financial crisis that put a big dent in nuclear power demand, to a glut ofdecommissioned weapons-grade uranium, to the Fukushima nuclear disaster in Japan, which led to the shutdown of all that nation’s nuclear power plants and inspired nuclear phase-outs in places such as Germany and Switzerland.Investors in uranium mines have seen their assets plunge in value:……

May 30, 2014 Posted by | AUSTRALIA - NATIONAL, business, uranium | Leave a comment

Can things get any worse for Australia’s uranium industry?

Uranium − how low can it go? Business Spectator JIM GREEN , 29 May 14, Australia’s uranium lobby is shameless. Michael Angwin from the (now defunct) Australian Uranium Association claimed that Australia “has enough reserves to be to uranium what Saudi Arabia is to oil”.

Specious comparisons between Australian uranium and Saudi oil have also been made by former South Australia premier Mike Rann, pseudo-academics Ian Plimer and Haydon Manning, Access Economics, and Comrade Paul Howes from the Australian Workers Union.

But Australia’s uranium export revenue in 2011 was 466 times lower than Saudi oil revenue in the same year − Australia would need to supply entire global uranium demand 31 times over to match Saudi oil revenue. The uranium industry accounts for 0.015 per cent of jobs in Australia, and in the 10 years from 2002-11 it accounted for just 0.29 per cent of national export revenue (with most of that revenue never coming anywhere near Australia because of the high level of foreign ownership).

The uranium industry hoped that the post-Fukushima spot price would rebound after it fell to $US50/pound … but then it fell to $US40 … and now it has fallen below $US30.

The uranium spot price fell to $US29/pound U3O8 on May 5 and has not budged since. Not since mid-2005 has the price been so low. The price is less than one-half of the pre-Fukushima price, and less than one-quarter of the price at the peak of the 2007 bubble.Uranium Investing News notes that “the phrase ‘uranium renaissance’ has been uttered so often that it has begun to feel like a bad joke”.


What’s going on?

The uranium lobby has been arguing that plans to begin restarting reactors in Japan later this year (all of Japan’s 48 reactors are currently shut-down in the wake of the Fukushima disaster) will lead to higher uranium prices. But as As FNArena notes, progress towards reactor restarts in Japan “has been glacial and anti-nuclear protest has been powerful”.

Japan’s uranium inventories probably amount to around 100 million pounds (45,400 tonnes) according to David Sadowski, a Raymond James analyst.

Sadowski added that many utilities around the world “are sitting on near-record piles” of uranium. It could take a decade or more before Japanese utilities exhaust existing inventories.

China is buying uranium − but is now sitting on stockpiles sufficient to meet current annual consumption eight times over. The uranium lobby hoped that the December 2013 end of a US-Russian agreement to downblend weapons uranium for use in power reactors would stimulate a price increase. But the spot price has fallen 17 per cent this year alone.

French state-controlled nuclear group Areva’s first-quarter revenue from its uranium mining unitfell 63 per cent. The mining arm of Russia’s state-controlled utility Rosatom has frozen uranium expansion projects in Russia and elsewhere (hence the Honeymoon mine in South Australia has been put into care-and-maintenance). Canadian giant Cameco has abandonedits earlier uranium production growth targets (and scaled back uranium exploration and development work in Australia). In 2012 BHP Billiton cancelled its planned expansion of Olympic Dam in South Australia and disbanded its uranium division. Wannabe uranium miner Marathon Resources gave up on the uranium game last year, stating that the “risks were more likely to exceed rewards”. Energy Resources of Australia is struggling with the political and economic fallout of a December 2013 leach tank collapse at the Ranger mine in the Northern Territory resulting in the spillage of 1.4 million tonnes of radioactive slurry; the collapse of a ventilation shaft a few weeks ago; and the revelations of a whistleblower published in the Mining Australiamagazine on May 5.

Australian-based Paladin Energy operated two mines in Africa but production at one of those mines has been suspended and the company is at risk of going bankrupt. As Paladin Energy chief executive John Borshoff said last July, “the uranium industry is definitely in crisis”.

A nuclear insider’s view

Just about everyone in and around the uranium industry consoles themselves with the thought that uranium prices will have to rebound sooner or later to stimulate new production, which will be required even if global nuclear power capacity continues to stagnate. A contrary view comes from Steve Kidd, an independent consultant and economist with 17 years of work at the World Nuclear Association and its predecessor, the Uranium Institute.

Writing in the Nuclear Engineering International Magazine on May 6, Kidd states that “the case made by the uranium bulls is in reality full of holes” and he predicts “a long period of relatively low prices, in which uranium producers will find it hard to make a living”……



May 29, 2014 Posted by | AUSTRALIA - NATIONAL, business, spinbuster, uranium | Leave a comment

Terminally ill? Paladin closes its uranium mine in Malawi

burial.uranium-industryPaladin to shut its uranium mine, Australian Mining,  27 May, 2014 Cole Latimer Paladin has announced it will cease production at its Kayelekera uranium mine in Malawi.

It comes after the miner advised it would place the operation in to care and maintenance earlier this year.

According to Paladin it is ceasing production “due to reasons beyond the company’s control and related to the depressed uranium prices”.

On May 21 it halted all operations at the mine, and will now cease supplying uranium to the global market, causing a drop of around 3.3 million pounds of supply per annum.

“The outcome is an unfortunate but direct consequence of the continuing deterioration in the uranium price,” the company said in a statement. “Certain estimates now place up to 60% of current annual global production with costs above the current spot price, which is unsustainable.”…..

May 28, 2014 Posted by | AUSTRALIA - NATIONAL, business, uranium | Leave a comment

No future in sight for Yeelirrie or Kintyre uranium mines, nor for Olympic dam expansion

text-uranium-hypeUranium fall dents Olympic outlook  BARRY FITZGERALD THE AUSTRALIAN MAY 27, 2014  BHP Billiton’s recasting of its ­expansion plans for its Olympic Dam copper/uranium mine in South Australia’s outback have been served up a new challenge — the collapse in uranium ­prices.

Spot uranium has fallen 30 per cent in the past 12 months to $US28.15 a pound, plunging most of the world’s uranium-only mines into losses. More telling has been the steady decline from the record price of $US137 a pound in mid-2007, due in part to the fall in demand in the wake of Japan’s Fukushima nuclear disaster in 2011.

BHP dropped plans for a big-bang expansion of Olympic Dam in mid-2012, blaming the $30 billion cancellation on the over-heated resources sector and the country’s high-cost environment. Concerns about uranium’s outlook post-Fukushima was also a factor……….

When it shelved the big-bang expansion plan, BHP said it would investigate a less capital-intensive design, and one that drew on new mining and processing technologies to improve the economics of the project.

BHP chief executive Andrew Mackenzie also undertook in September to say more about plans for the expansion “within about a year’’. While that timing is almost up, BHP’s considerations of what the price slump means for the future of what is the world’s biggest uranium deposit makes its planning for an expansion all the more complex.

Like the rest of the industry, BHP will be pinning its hopes on the restart of nuclear power plants in Japan, and the forecast surge in China’s nuclear power industry, to eventually produce more sustainable prices — in the context of being able to make a profit from the material at any rate……..

“uranium prices continue to suffer downward pressure and we do not see any reason to expect improvement soon.’’ -Tim Gitzel, the chief executive of Canadian uranium giant Cameco, which owns two of the world’s biggest undeveloped uranium deposits in Western Australia — Yeelirrie and Kintyre.

That means that neither Yeelirrie, acquired from BHP, and Kintyre, acquired from Rio Tinto, are  about to be developed anytime soon…..

May 27, 2014 Posted by | business, South Australia, uranium, Western Australia | Leave a comment

Glut of uranium, prices plummet, Australian company Paladin’s share price drops 4.6%

burial.uranium-industryUranium Slides as Banks Reduce Outlook Amid Japan Delays, Bloomberg, 18 May 14 By Ben Sharples    Delays in restarting Japan’s nuclear reactors are prolonging a uranium supply glut that’s driven prices to an eight-year low, making banks from UBS AG to Credit Suisse Group AG less bullish on the fuel.

Uranium dropped to $29 a pound on May 2, the lowest since June 2005 and extending this year’s drop to 16 percent, according to TradeTech, a Denver, Colorado-based consultant to the nuclear industry. UBS reduced its 2014 forecast by 9 percent last month as Credit Suisse cut its projection by 7 percent.

Kansai Electric Power Co. (9503) and other utilities are taking longer than expected to restart reactors that closed after the Fukushima disaster in March 2011 as Japan’s nuclear regulator seeks more safety checks. While producers from Australia to Africa shut mines as prices retreated to unprofitable levels, Raymond James Ltd. is among those who say supply will still outstrip demand this year.

“There is too much supply floating around the marketplace and demand is highly limited,” said David Sadowski, a Vancouver-based analyst at Raymond James, a financial adviser, who cut his 2014 forecast by 14 percent to $36 a month ago. “Japanese restarts are the key catalyst to get utilities to resume long-term contracting, which should support prices.”

Uranium for immediate delivery averaged $33.93 this year, compared with $38.47 in 2013 and $46.27 in 2010, the year before the earthquake and meltdown of the Fukushima Dai-Ichi plant and subsequent closure of Japan’s reactors for safety checks. Uranium closed at $28.40 yesterday on the New York Mercantile Exchange………

Forecasts Cut

UBS reduced its 2014 forecast for uranium on April 9 to $39, while Credit Suisse cut its estimate to $38.80, according to an April 1 note. The exit of traders such as Goldman Sachs Group Inc. from the market is also reducing transactions, according to Roswell, Georgia-based Ux Consulting Co.

Deutsche Bank AG is cutting back parts of its commodities business including uranium, Nick Bone, a London-based spokesman, said by e-mail May 7. Michael DuVally, a spokesman for Goldman Sachs in New York, declined to comment in an e-mail on the sale of its unit trading the fuel………

Prices are below the marginal cost of production of $35 estimated by UBS. Paladin Energy Ltd. said in February it will halt its Kayelekera operation in Malawi while Russia’s Atomredmetzoloto last year shuttered Honeymoon in Australia. Kazakhstan, the world’s biggest producer, said in November it will halt all projects to increase output after the decline.

Paladin, which gets all of its revenue from selling uranium, fell as much as 4.6 percent today in Sydney trading………

May 19, 2014 Posted by | AUSTRALIA - NATIONAL, business, uranium | Leave a comment

Australian uranium mining company arousing concern in Greenland

bad-smell-nukeThe prospect of a relatively unknown Australian company exploiting massive untapped resources in Greenland deserves a robust public and political debate. It has thus far received nothing in Australia, and little in Denmark and Greenland. In an age of worsening climate change, mining uranium is an arguably unsafe and potentially explosive answer to the problem.

Australian uranium mining in Greenland is tearing the country in half After Greenland’s prime minister repealed a law on uranium mining, Australian firms are staking out the country for exploitation. Local political opposition is heating up

 This is a story about an Australian company you’ve never heard of, operating in a nation that rarely enters the global media: Greenland. It’s a story about the intense search for energy sources in a world that’smoving away from the dirtiest fossil fuels.
>Aleqa Hammond, the prime minister of Greenland, is the first woman to lead this autonomous country within the Kingdom of Denmark. She also welcomes the financial opportunities from climate change and a melting Arctic Circle.

“I simply refuse to be the victimised people of climate change”, she toldBusiness Week this month. “This time we have other options than just hunting. We have the right now to our own underground.”

In October last year, Hammond pushed legislation through Greenland’s parliament to overturn a 25 year old ban on the extraction of radioactive materials, including uranium, despite countless leading environmental NGOs urging otherwise. It attracted global interest from the rare earth and uranium industries, including from China. Concerns were also raised about Greenland’s ability to manage a toxic substance in the wake of Fukushima and Chernobyl.

The company Greenland Minerals and Energy Limited (GMEL) is based in Perth, Western Australia. This year GMEL announced a major step forward in their plan to open one of the world’s largest uranium mines in southern Greenland, at Kvanefjeld. The mine will also produce fluoride, thorium and other rare earths.There is still significant opposition to the Kvanefjeld project. The Ecological Council, a Danish NGO, organised a conference to discussthe potential contamination risks in March, noting that the mine poses serious risks for the inhabitants of the nearby village, Narsaq. Many locals told the BBC that they worried about pollution and challenges to traditional ways of life if GMEL moved ahead with its plans. Unsurprisingly, Danish green groups have pushed for a continued ban on uranium mining. They claim that rare earth elements can be extracted without uranium mining in Greenland.

This would have been an important but fairly typical contest over resources, but after issues surrounding the ownership and status of Perth-based GMEL were raised in the Greenlandic parliament, the prospects of the Australian firm may be in jeopardy.Late last year, Greenland MP Sara Olsvig (tipped by some as a future prime minister) wrote to the country’s minister of industry and minerals, Jens-Erik Kirkegaard. She demanded details about any and all of GMEL’s shareholders, after Australian media outlets had raised allegations about both the company back in 2009 (here and here) and mining prospector Mihran Shemesian, also known as “Mick Many Names“.

In 2009, Fairfax media claimed that Shemesian controlled more than 20% of GMEL stock. Range Resources, another company tied to Shemesian, had earlier been accused of paying the disputed government of the Puntland State of Somalia, linked to Somali rebels, more than $US6m ($A9.3m) for resource rights to the region. Since then, there have been very few stories about him.

Kirkegaard responded that the government dismissed any concerns about GMEL – “the alleged events all occurred outside Greenland’s jurisdiction” – and claimed that the company didn’t own an exploration license anyway, so there was nothing to worry about. This isn’t quite the case: Greenland Minerals and Energy A/S (GME), the firm granted the licence, is the wholly-owned Greenlandic subsidiary of GMEL.So is “Mick Many Names” Shemesian involved with GMEL? John Mair, the company’s executive director, told me he isn’t “registered as a shareholder”. But he would not guarantee that Shemesian has no involvement with GMEL.

Mair is proud of the Kvanefjed project, where “risks can be appropriately mitigated”. GMEL was “working with Greenland to help establish a secure and viable economy that will help sustain their increasing political independence,” he told me, adding that he was “optimistic” GMEL would be granted a mining license in the foreseeable future because “we have much local community support in Greenland”.A key shareholder in GMEL is Perth-based geologist Greg Barnes, founder and CEO of Tanbreez. He told me by phone from Singapore that he has personally invested $40m towards mining possibilities in Greenland. He says he has known Shemesian for 30 years and “has heard that he has a 50% share in GMEL and I’ve heard that he has 0%. I have no relationship with him.”

But in December last year he told Grønlandsposten, a Greenlandic newspaper that, “he and Shemesian could probably fire GMEL’s board if they wanted to”. He told me that this referred to the make-up of GMEL many years ago – not today.

“[Greenland] is the size of Western Australia but it has no mines”, he said. “In Western Australia an application for mining would take three months but in Greenland it takes years.” A vast part of Greenland has been “staked out by a number of Perth companies.” Barnes isn’t concerned about climate change “because it didn’t really show up in places like Greenland apart from some ice sheets reducing”.

There is another view. Niels Henrik Hooge is a Danish consultant who works with green NGOs. He’s been at the forefront of the campaign against uranium mining in Greenland. He says to me that the people of Greenland are “split down the middle regarding the repeal of the [uranium] ban.”

Hooge explains that the “mineral authorities” have fed the public disinformation over the last years but the tide may be turning, with growing concerns over environmental effects and the leftist party Inuit Ataqatigiit pledging to roll back the repeal if it wins back power.

The prospect of a relatively unknown Australian company exploiting massive untapped resources in Greenland deserves a robust public and political debate. It has thus far received nothing in Australia, and little in Denmark and Greenland. In an age of worsening climate change, mining uranium is an arguably unsafe and potentially explosive answer to the problem.


May 16, 2014 Posted by | AUSTRALIA - NATIONAL, business, politics international, uranium | Leave a comment

Uranium stock prices at last come to the reality of the market decline

CHART: Uranium stocks vs spot price – something’s gotta give #auspol  Frik Els | May 15, 2014

The prospect of a Japanese nuclear reactor restart.       The end of the Russia-US megatons to megawatts program last August, eliminating a huge source of supply.      China’s accelerated plan to approve six to eight plants a year through 2020; part of its war on pollution.    The possibility of a rethink in Germany about phasing out nuclear (coal is the only viable alternative and Putin’s gas is becoming dearer).As the stars aligned for a pickup in global uranium demand so did investors for uranium stocks.

But the rapid run-up in uranium shares – especially developers – didn’t turn out to be a leading indicator.

The spot price continued to slide going below $30 a pound to levels last seen in 2005. That dragged the long term price, where most uranium business is conducted, down to $45, a six year low.

Uranium stocks have now come down to earth as this chart from Haywood Securities shows.


The independent investment dealer with $5 billion under management says now that the spot price appears to have found something of a floor, the sell-off may begin to slow down.

But the Vancouver-based firm cautions that the shares of producers and developers “remain at or above their indexed price point of 12 months ago, when spot uranium was $40.70 U3O8, a 40% premium to current spot”.

There may be more pain ahead

May 16, 2014 Posted by | AUSTRALIA - NATIONAL, business, uranium | 1 Comment

Uranex company faces reality: getting out of uranium industry, changing its name

bad-smell-nukeUranex dumps uranium for graphite  Brisbane Times, May 13, 2014 – Greg Roberts The 2011 Fukushima nuclear disaster killed the dreams of many an Australian uranium explorer.

One of those, Uranex, has survived by changing commodities.

It went back and kicked the dirt again on its tenements in Tanzania and discovered another resource there: graphite.

In 2012 a stubbornly weak uranium price and a 200 per cent rent hike by the Tanzanian government spurred it into action……..

Graphite is in demand because it is a necessary component in rechargeable lithium ion batteries.

An eventual predicted take-up of electric cars would spur even more demand – nearly 40kg of graphite is used in each of those batteries.

Graphite has been used in batteries for decades because it is an electrical conductor, but the technological explosion in smart phones and other portable devices has sent demand soaring.

Uranex would be in production by 2017 in a best case scenario producing 100,000 tonnes of graphite a year at its Nachu site……He also feels a bit more empowered about a name change away from `Uranex’, now that graphite rather than uranium is the main game.


May 13, 2014 Posted by | AUSTRALIA - NATIONAL, business | 1 Comment


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