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A URANIUM EXPLORER MAKES EXCITING FIND BUT SHARES SLIDE

Sydney - Wednesday - January 23: (RWE Aust Business News)
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OVERVIEW

The market has certainly lost confidence when a miner announces that a new uranium discovery has the potential of a major producer but the shares buckle in the current selloff. Shares of Bannerman Resources Ltd (ASX:BMN) yesterday slumped 93c to $2.25 on what should have been a bullish report in any other period.

But the market has fallen 12 sessions in row and every company has been vulnerable to a downturn. On Monday, Bannerman Resources declared it sees its Namibian project, Goanikontes Anomaly A, as a major uranium producer based on results from a scoping study.

The project is ideally located close to existing uranium mines and major infrastructure and the study has outlined the potential for an economic and robust project. The case study for on-site acid production is part of the ongoing
work that is refining the details for the project economics in areas identified with the potential to reduce the operating costs in the proposed processing plant. On-site acid production not only reduces the project costs but includes the security of supply against third-party acid procurement and produces a significant component of the overall project power requirements.

Further improvements to the operating costs may be achievable and the work required to assess these improvements will be included within the scope of the Bankable Feasibility Study scheduled to commence in February.

Bannerman is continuing to progress the project towards development in line with the schedule. A resource update for Goanikontes Anomaly A will be completed this month.

SHARE PRICE MOVEMENTS
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Shares of Bannerman Resources yesterday slumped 93c to $2.27. Rolling high for the year is $4.14 and low 1.30. The company has 132.5 million with a market cap of $298.2 million. But the weakness in the company may not all be due to current market conditions.

In December, Bannerman Resources reported that a company incorporated in Namibia, Savanna Marble Close Corporation, had commenced proceedings in the High Court of Namibia against the Namibian Minister of Mines and Energy, Bannerman's 80 per cent-owned subsidiary Bannerman Mining Resources (Namibia) (Proprietary) and an individual known as Robert D Wirtz who has no connection with Bannerman.

The proceedings sought to seek an order reviewing and correcting or setting aside the decision taken by the Minister of Mines and Energy in Namibia to grant Bannerman Namibia Licence EPL3345 with exclusive mineral rights for the nuclear fuel group of minerals over the area covered by Savanna's EPL3045, or alternatively, orders that the decision by the Minister of Mines and Energy to grant Bannerman Namibia EPL3345 be declared null and void.

Savanna is also seeking the costs of the application. Bannerman said EPL3045 held by Savanna only entitles it to mine stone known as "dimension stone". It is not entitled to explore for or mine any nuclear fuel minerals.

About three months ago Savanna applied to have nuclear fuels added to its licence. This application has not been dealt with and in Bannerman's view is unlikely to be granted. Savanna's EPL3045 is situated north of the Swakop River not near the company's Goanikontes Anomaly A deposit. The area which is the subject of the notice does not overlap on the current drilling program and will not have an impact on the exploration and development work planned by Bannerman Namibia.

Bannerman is not expecting any delays to the current schedule from this action. Savanna has applied for a mining licence indicating the area of economic interest for dimension stone sits on the northern boundary of the company's licence EPL3345.

The mining licence application does not cover any uranium targets currently in the company's inventory. Prior to the commencement of the proceedings Bannerman Namibia had taken advice in relation to many of the matters that are the subject of the proceedings, has formed the view that the proceedings have no proper foundation and are unlikely to succeed. The proceedings will be vigorously defended. Bannerman pointed out that under Namibian law it is possible, and quite common, to have overlapping mining permits for different minerals.

Apart from the Savanna dimension stone prospecting licence there is also a mining licence for copper, a prospecting licence for limestone and an application for mica. Bannerman Namibia does not expect that Savanna's right to mine dimension stone will affect Bannerman's ability to explore for and mine uranium in the overlapping parts of its licences.