Anglogold eyes uranium potential in Australia

Anglogold eyes uranium potential in Australia

Wednesday, August 8th 2007

Booming uranium prices could tempt Anglogold Ashanti Ltd. , the gold mining arm of Anglo American , into uranium exploration in Australia, a company executive said on Wednesday.

Anglogold, which already mines some uranium as a by-product from gold mines in South Africa, was looking at the potential for yielding uranium from the Tropicana gold prospect in Western Australia state, said Graham Ehm, regional head of Anglogold Ashanti Australia Ltd.

Ehm said Anglogold was not actively seeking to exploit the uranium contained in the mostly gold-bearing ore at the Tropicana lode, but with uranium prices above $100 a pound, that could change.

“I don’t know where we would go with this…But it’s a good by-product, with a price above $100 it becomes a pretty interesting revenue generator,” Ehm said on the side of the Diggers and Dealers global mining conference.

Uranium prices have more than quadrupled in the last two years as stockpiles disappear and investors bet on a proliferation of new nuclear power plants across Asia.

A growing number of countries are turning to nuclear power to secure their long-term energy needs and as a way of reducing their carbon emissions.

The Tropicana prospect, discovered seven years ago by Independence Gold N.L. is regarded as one of the biggest gold finds in Australia for decades.

Under an agreement struck with Independence, Anglogold can earn 70 percent ownership in the mine.

Anglogold, 42 percent owned by Anglo American, has long presented itself as a strictly gold mining investment under its long-serving chief executive, Bobby Godsell, though like most gold miners, it garners extra revenue from other metals found in its ores. Godsell has announced he will retire next month.

Uranium mining is banned in Western Australia under a decades-old policy of the Labor Party in the state.

But that hasn’t discouraged an army of prospectors from combing the outback with hi-tech geiger counters for the radioactive ore in the hope that the policy will change.

Nearly 40 companies listed on the Australian Stock Exchange are exploring for uranium nationwide, though only two — majors BHP Billiton Ltd./Plc. and Rio Tinto Ltd./Plc. subsidiary Energy Resources Australia Ltd. , actually mine the mineral, needed to make nuclear fuel.


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