http://uraniuminvestingnews.com/12129/delays-olympic-dam-kintyre-...

http://uraniuminvestingnews.com/12129/delays-olympic-dam-kintyre-uranium-supply-deficit-bhp-billiton-cameco.html?utm_source=Resource+Investing+News&utm_campaign=97190850f4-RSS_EMAIL_CAMPAIGN&utm_medium=email

"Over the past year, the post-Fukushima global uranium market has struggled to regain the 2010 optimism that sent spot prices surging to $67.50/lb. A “wait-and-see” attitude on the part of both end users and investors has further hobbled the market and over the past few months has led most analysts to call for near- to medium-term uncertainty for spot and share prices alike."

and

"Over the weekend, Sarah Martin, The Australian’s political reporter for South Australia, claimed she had documents showing that mining giant BHP Billiton (NYSE:BHP,ASX:BHP,LSE:BLT) informed consultants that it will be delaying by two years a decision to proceed with the AU$30 billion proposed expansion of the Olympic Dam mine — which has been touted “by federal and state Labor governments as key to South Australia’s economic future.”

That stunning news followed on the heels of another weekend report from Cameco (TSX:CCO;NYSE:CCJ). The world’s third-largest uranium producer announced during a conference call on Friday that the company will be putting the Kintyre project in the Great Sandy desert on ice, citing “challenging” economics at current uranium prices."

"The expansion of BHP’s Olympic Dam was anticipated to yield 40.6 million pounds of U3O8 a year, or 17 percent of forecast global mine output in 2020. Cameco’s 70 percent-owned Kintyre project, heralded as one of the world’s biggest undeveloped uranium deposits, is expected to produce 40 million pounds of U3O8 over a seven-year mine life.

Delaying the Olympic Dam expansion by two years will remove more than one million pounds of annual uranium production from 2013 to 2014. More than 10 million pounds of uranium production from the second phase of the expansion will be pushed back to 2020, along with another nearly 22 million pounds from phase three not seeing production until 2027.

“As a result of the two year delay, we see a tight uranium supply and demand environment in 2013 with a modest surplus of nearly nine million lbs of U3O8,” said Rob Chang, metals and mining analyst at Versant Partners, in a note to clients. While Chang forecasts a strong supply for 2014 to 2018 — barring any delays or production slowdowns — as Cameco’s Cigar Lake and Areva’s Imouraren mine come on line, the analyst sees “a modest but shrinking surplus [in 2019-2021] that ultimately falls into deficit in 2022.”