EXT excite technology services ltd

from bloomberg big press

  1. 165 Posts.
    If this doesnt cheer you all up I dont know what will!

    Extract ‘Inundated’ by Potential Namibia Uranium Mine Partners

    By James Paton

    Oct. 16 (Bloomberg) -- Extract Resources Ltd., a uranium explorer whose shares have surged almost eightfold in Australia this year, said it has been “inundated with requests” from companies proposing to join or take over its Namibian project.

    “We’re looking at options to see whether one of the big players would want to come in on a strategic partnership level,” Chairman Steve Galloway said in an Oct. 13 telephone interview from Namibia. Extract is being advised by Rothschild, the largest family owned bank, and may ask shareholders in November to consider proposals to bring its Rossing South mine to production, he said. He didn’t name any potential partners.

    Extract, 15 percent owned by Rio Tinto Group, has gained more this year than any other stock in Australia’s S&P/ASX 200 Energy Index as investors bet countries will turn increasingly to nuclear power, using fuel derived from uranium, in response to climate change. Drilling at Rossing South suggests it could become one of the world’s largest uranium mines, Galloway said.

    Investors “are jostling for a piece of the action,” said Gavin Wendt, an independent resources analyst who has followed Extract for three years and met with executives from the explorer in the southwest African country about two months ago. A joint venture, possibly with Rio, may be the most likely scenario, he said, adding that the stock’s “remarkable ride” has driven up the potential acquisition cost.

    Extract Resources has told suitors “we’re not for sale,” Galloway said. Rio Tinto doesn’t comment “on market rumors or speculation,” Tony Shaffer, a spokesman for the company, said by phone from Melbourne yesterday.

    Fund Raising

    The stock traded at A$10 at 11:10 a.m. in Sydney, valuing the company at almost A$2.4 billion ($2.2 billion), compared with about A$311 million at the end of last year.

    The Perth-based explorer may sell more than $700 million in shares and debt in 2011 to bring the Rossing South mine into production, Galloway said. That’s in addition to A$91 million it raised this year by issuing equity.

    The Australian company has appointed a chief executive to run its Swakop Uranium subsidiary and oversee development of the mine. Galloway declined to name the person before an announcement due today. Extract also expects to replace Managing Director Peter McIntyre, who stepped down in September, by early next year, he said.

    Extract said Oct. 9 it found new high-grade mineralization at Rossing South and estimated the total uranium resource could reach 500 million pounds. The deposit is about 7 kilometers (4.4 miles) from Rio Tinto’s Rossing mine and approximately 30 kilometers from Paladin Energy Ltd.’s Langer Heinrich project.

    ‘No Bad News’

    “We keep finding better and better resources,” said Galloway, a former mineral economist with the Namibian government. “We haven’t seen bad news yet.”

    London-based Kalahari Minerals Plc, which owns about 41 percent of Extract, said Oct. 9 the project potentially could rival the world’s biggest known uranium deposit at BHP Billiton Ltd.’s Olympic Dam. BHP wouldn’t provide an estimate in pounds.

    Even before the latest drilling results, Brock Salier, an analyst at Ambrian Partners Ltd. in London, said in research notes that he was confident Extract’s resource could exceed 560 million pounds. In an e-mail yesterday, he wrote that the update from Extract showed “not only some of the widest, but highest grades, we’ve seen to date.”

    Rossing South may be able to produce more than 15 million pounds of uranium oxide a year, “a huge amount,” Galloway said.

    ‘Profitable Business’

    A possible risk to profits is that “a lot of other uranium comes on stream,” curbing gains in the price of the nuclear fuel, he said. “But I think, over the long run, uranium will be a very profitable business.”

    The uranium market will have a surplus next year for the first time in at least three years as producers increase output faster than demand rises, the London-based World Nuclear Association said in a Sept. 10 report. Secondary sources such as stockpiles will supply 18,711 metric tons in 2010 compared with 17,620 tons this year, the report showed.

    Uranium prices, which peaked at $136 a pound in 2007, rose 5.7 percent in a week to $46 a pound on Oct. 12, Ux Consulting Co. said in an Oct. 13 report.

    Extract expects favorable supply and demand conditions when Rossing South is projected to begin production in 2013, Galloway said. “By 2013, 2014 there will be a space for new uranium on the market.”

    Some 440 commercial nuclear power reactors operate in 30 countries, with a further 30 under construction and another 90 planned, the World Nuclear Association said in a March report posted on its Web site.

    Galloway said “the company is at a crossroads” as it explores partnership options and considers whether to expand beyond a single project in a single country. For now “we’re trying to get on with developing the resource as fast as we can,” he said.

    To contact the reporter on this story: James Paton in Sydney [email protected].
    Last Updated: October 15, 2009 20:31 EDT
    http://www.bloomberg.com/apps/news?pid=20601085&sid=aM4_PpnX.gFE
 
Add to My Watchlist
What is My Watchlist?
A personalised tool to help users track selected stocks. Delivering real-time notifications on price updates, announcements, and performance stats on each to help make informed investment decisions.
(20min delay)
Last
1.0¢
Change
0.000(0.00%)
Mkt cap ! $20.72M
Open High Low Value Volume
0.9¢ 1.0¢ 0.9¢ $47.68K 5.278M

Buyers (Bids)

No. Vol. Price($)
1 400000 0.9¢
 

Sellers (Offers)

Price($) Vol. No.
1.0¢ 6370837 8
View Market Depth
Last trade - 16.10pm 25/07/2025 (20 minute delay) ?
EXT (ASX) Chart
arrow-down-2 Created with Sketch. arrow-down-2 Created with Sketch.