rcr uranium report

Resource Capital Research.
September Quarter, 2009.

African Energy Resources Ltd.

A$4m share placement will fund ongoing uranium exploration of AFR's strategic land position in the Karoo basins of southern Africa (9,150km2). The Chirundu JV (Zambia, 8.7mlbs U3O8) has a BFS in progress for 1.3mtpa U3O8. Drilling ~17,500m in FY10.

- Production and Financial Forecasts.
- Company Comment.
- Reserves and Resources/Mineralised Material.
- Key Projects.

AFRICAN ENERGY RESOURCES VALUATION.
AFR valuation derived from Chirundu prefeasibility study (2Q08) and subsequent opex update (Jun ’09) as part of BFS. Chirundu NPV break-even is at a uranium price of ~US$30lb on current project parameters.

CHIRUNDU URANIUM PROJECT (based on PFS, Jun '09 opex guidance and potential satellite expansion)

CHIRUNDU URANIUM PROJECT KEY ASSUMPTIONS*

* These figures are preliminary in nature and are intended to provide only a general indication of project potential scale and economic robustness. Further refinement may result from ongoing Bankable Feasibility Study.

Our 24 month target price for AFR is A$0.20/share fully diluted (post-placement, based on contract uranium price of US$65/lb) assuming US$100m project financing and exploration success to extend LOM at Chirundu to 10 years.
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3 PAGE report in Sept Q uranium free download at

http://www.rcresearch.com.au/documents/uranium/reports/0/australia/