2009 Uranium Conference Highlights

By Melissa Pistilli-Exclusive to Uranium Investing News

Paydirt magazine, an internationally-circulating mining publication, hosted its fourth-annual Uranium Conference in Adelaide, South Australia. The two-day program included nuclear industry leaders, exploration and ining representatives, and government officials coming together to discuss the uranium and nuclear energy industries.

Some of the topics at the 2009 conference included reports on BHP Billiton’s Olympic Dam mine, the current financial crisis’ impact on the uranium mining sector, and Botswana’s uranium mining future.

Olympic Dam Delay

The global financial crisis is hurting even industry leaders like BHP Billiton. Analysts are anticipating forced delays to BHP’s planned expansion of the Olympic Dam mine in South Australia, which hosts the world’s largest known uranium deposit.

Speaking at the conference, BGF Equities director Warwick Grigor said BHP would be better off using their cash to make acquisitions than expanding projects. “We really don’t know where the end of the tunnel is in terms of this economic crisis and it would be very brave of BHP to be throwing a lot of money at that when they can buy so many other bargain-basement assets around and extend their power that way,” said Grigor.

BHP had originally planned to have the first stage of the five-phase expansion into production by 2013, but Grigor predicts a delay of at least two years or more.

The Uranium Industry’s “Walking Dead”

Mr. Grigor also warned conference attendees that the financial crisis has spawned a shake-down in the uranium mining industry and many of the sector’s companies are already “walking dead.” These “zombie companies”, as Grigor calls them, are those miners with meritless properties and/or are cash-strapped; the companies created merely to jump on the uranium bandwagon when the spot price was riding high.

It seems the global credit crunch is working to separate the weak from the fold. “Some companies will merge and some companies will be taken over, but in many cases it won’t even be worth paying the corporate advisory and legal fees to complete mergers,” added Grigor.

Botswana to Become a “Second Namibia”

Recently, Mining Weekly suggested the African nation of Botswana may soon become “a second Namibia,” which is well-known for its uranium mining industry and resources. Recently, about 138 prospecting licenses for the exploration of uranium were issued by the Botswana government. Exploration activity is taking place “across the length and breadth of Botswana,” said Minerals Minister Ponatshego Kedikilwe.

Australian-based A-Cap Resources [ASX: ACB] is one uranium miner seeking success in Botswana and is on target to put Botswana’s first uranium mine into production. The company is currently exploring and developing the Letlhakane mine. At the Paydirt 2009 Conference on Tuesday, A-Cap Managing Director, Dr. Andrew Tunks said the company has enough confidence in Letlhakane’s known and existing potential to move operations toward feasibility studies this year.

“Our view is to initiate much of the required feasibility study workload during calendar 2009. Although we have a current inferred resource of 100-million pounds, we believe Letlhakane has an exploration target in excess of 200-million pounds of uranium oxide (U3O8),” said Tunks. The results of a scoping study conducted on the property were released in October of last year and confirmed a resource of 280-million tonnes at 158 parts per million U3O8 for 44,500 tonnes of contained concentrate. The estimated cash costs for the mine at Letlhakane is $33 per pound with a proposed production rate of 20,000 tonnes per day.

A-Cap plans to ask the Botswana government for a mining license by early 2010 and hopes to bring the Letlhakane mine into production by 2011. On Wednesday, shares of A-Cap on the ASX were trading at .15 cents, down from a 52-week high of .88 cents.




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