Uranium One offloads Dominion, invests in Paladin

11 May 2010

Vancouver-based Uranium One has quietly acquired about 3% of Australia-based Paladin Energy for "investment purposes" but has sold the Dominion uranium mine in South Africa.

Uranium One president and CEO Jean Nortier announced the investment in Paladin when presenting first quarter results, and said that his company would be constantly reviewing its investments. "We may increase or decrease our stake at any time," Nortier told investors. His announcement followed on from a company statement at the end of April to say that Uranium One had acquired an investment in Paladin through its Luxembourg-based subsidiary Cheetah Resources SARL. Paladin subsequently confirmed that at that time Uranium One had increased its investment from some 9.8 million shares to nearly 11.8 million.

Uranium One's investment in Paladin appears to have been carried out without the knowledge of the Australian company which has operating uranium mines in Namibia and Malawi as well as at home. Nortier's Q1 announcement was swiftly followed by one from Paladin managing director and CEO John Borshoff noting that Paladin had not been contacted directly by Uranium One about its intention regarding the shareholding increase. "Paladin will keep the market informed if and when further information becomes available," he told shareholders.

Uranium One's portfolio includes uranium assets in Kazakhstan, the USA and Australia. Its 1.8 million pounds U3O8 attributable production for the first quarter of 2010, all from its Kazakh interests, was 147% up on the same period in 2009 due to its December 2009 acquisition of 50% of the Karatau uranium project.

The company says it is on track for attributable production of 6.8 million pounds U3O8 in 2010, rising to 8.0 million pounds in 2011 when initial production from its recent US acquisitions - Christensen Ranch and Irigaray, both in Wyoming's Powder River Basin - will be included. The $35 million cash acquisition of the Wyoming projects was completed in January 2010.

Dominion sold

Meanwhile, Uranium One's results included a low-key announcement that it has now sold its 100%-owned Dominion Uranium Project in South Africa for cash proceeds of $37.3 million. The sale was completed in April, but the company has not disclosed further details.

Dominion started production in 2007 but production ramp-up was slower than anticipated. This, coupled with a slump in uranium prices and rising production costs, prompted the closure of the mine following a labour dispute in October 2008. Since then, the project has been on care-and-maintenance.

 

Researched and written

by World Nuclear News

 

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