April 12, 2011

Energy Resources (ERA) Forced To Purchase 4,000,000 Lbs Of Uranium After Mine Disruption

Published on Tuesday April 12 2011

* ERA says will need to buy up to 4,000,000 Lbs of Uranium after rains hit Mine.

* Cuts 2011 production guidance by more than one-third

* Sees H1 loss of between $30-$50 million (Recasts, adds details)
SYDNEY, April 12 (Reuters) - Australian uranium miner Energy Resources Australia (ERA) is being forced to buy uranium on the global market to meet its sales commitments as problems persist at its Ranger mine in northern Australia, the company said.

Heavy rains have flooded the mine pit and led to the suspension of processing of uranium oxide, sending output tumbling 42 percent in the March quarter. Processing is likely to remain stalled until at least late July, the miner said on Tuesday.

ERA, controlled by Rio Tinto , said it would need to buy as much as 2,100 tonnes of uranium oxide from third parties to meet its sales commitments of 4,500 tonnes this year.

It also forecast a first-half loss of between $30 million and $50 million, and said it was reviewing mine operations.

"In light of this continued suspension, which has occurred immediately after a very challenging 2010, a comprehensive business review of ERA's current operations and future projects is well underway," the company said.

"The review will assess priorities, processes and future expenditure."

ERA expects to mine only around 2,400 tonnes in 2011, well below earlier guidance of near 3,800 tonnes. (Reporting by James Regan; Editing by Mark Bendeich)

No comments:

Post a Comment