news article, page-4

re: cmr odds on for the yellowcake cup AFR article u mentiond gizard.
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Uranium decision falls nicely in resources' territory
Author: James Hall
Date: 06/08/2005
Words: 479
Source: AFR
Publication: The Financial Review
Section: Market Wrap
Page: 44


Companies with uranium deposits in the Northern Territory had a share-price run on Friday after the federal government took over the territory's process for approving uranium mines.
Energy Resources of Australia, the only Australian Stock Exchange-listed company with an operational mine in the territory, Ranger, rose 68 ? to close at $14.96.

Jindalee Resources, which is spinning off its uranium exploration arm as Energy Metals, and has a prospective site at Bigryli near Alice Springs, was the standout. Its shares rose 9 ? to close at 39 ?.

Far East Capital managing director Warwick Grigor said most uranium-linked stocks had risen strongly during the week on the high global spot price for the fuel, which was near $US30 a pound.

He warned against reading too much into the effect of the federal government's decision.

"All these stocks had been at high levels anyway," he said. "In the last couple of weeks, uranium stocks have been the best performers of any sector due to general speculation and uranium prices."

Compass Resources, which is exploring around Mount Fitch and Rum Jungle, rose 15 ? for a close of $1.35, while Arafura exploring for uranium around the Queensland border rose 2 ? to 36 ?. Deep Yellow, which owns the Napperby and North-East Arunta projects, rose 1 ? to 13 ?. Batavia Mining, which is trying to secure a portfolio of prospects in the territory, rose 0.6 ? to 4.6 ?.

Mr Grigor said the more important issue for investors was whether Canberra's decision was an indication of its intentions for the rest of Australia, amid a parliamentary committee inquiry into uranium's strategic importance.

Paladin Resources, which is building a uranium mine in Namibia, regained its losses from earlier in the week to rise 6.1 per cent on Friday, despite some analysts saying that increased supply of uranium from Australia would make its mine less viable.

Reefton Mining also rose, despite the Namibian Ministry of Mining saying a Reefton-claimed uranium deposit had no commercial value, and accusing the company of drilling without permission.

Mr Grigor said most uranium stocks would continue to move higher. "It's the continuation of the swing of the pendulum towards acceptability of uranium mining.

"Once the trend starts there's not much you can do to stop it. There are obligations on Australia to provide uranium to the world's nuclear power industry and the federal government can see that," he said.

"It's not just about Australia; really the only sustainable significant alternative to greenhouse-gas producing fuels is to go nuclear. Internationally, Australia has to be responsible for that."

ERA's majority owner, Rio Tinto, was down 20 ? to $50.40 after surging earlier in week following its record interim profit result.

BHP Billiton, which owns the Olympic Dam uranium mine in South Australia, was also down on Friday after a week in which it reached record highs above $20.


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