extract mulls rio help to develop namibian min

Extract mulls Rio help to develop Namibian mine

Extract Resources has spoken to several parties, including Rio Tinto, about developing its Rossing South deposit, the world's largest undeveloped uranium resource, but has not ruled out going it alone.

"Rio Tinto is one of many people that is being considered," non-executive director Neil MacLachlan told Reuters, adding: "There is no deal with Rio at this point and we may not deal with anyone".

Extract is assessing a number of options from strategic partners to help develop the Namibian deposit, potentially the world's second-largest uranium project after BHP Billiton's Olympic Dam in Australia.

"There is no dispute about the size of this resource, it's a question of how it gets developed," he said.

Rio Tinto holds about two thirds of the nearby Rossing mine, supplier of about 8 percent of the world's uranium, and already has about a 14 percent stake in Extract.

A strategic partnership with any of the potential partners could include providing marketing skills, financing or in offtake agreements.

Utility companies and governments as well as miners are thought to be interested, although MacLachlan declined to give details.

Extract hopes to complete a full feasibility study on Rossing South by the end of next June and is unlikely to release further resource statements before the end of the first half of next year, MacLachlan said.

The company has close to 13 drill rigs on the site at the moment, which are carrying out exploration work and defining the size of the resource, and is looking at potentially taking on an additional three rigs.

Extract has also started a worldwide search for a new chief executive, MacLachlan said.

The group's shares have jumped almost seven fold this year helped by positive drilling news as well as takeover speculation.

Kalahari Minerals holds a 40 percent stake in Extract.

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