Uranium Oil and Gas goes southadmin
Uranium Oil and Gas Ltd, a minerals company targeting a broad range of commodities including uranium and oil has not begun public life the way it might have hoped.
Despite having uranium projects in its portfolio, the company’s shares opened in negative territory at 18.5 cents, down from an initial public offer price of 20 cents, before closing at 17.5 cents.
Uranium Oil and Gas raised just over $7 million through its initial public offer.
The company has indicated its initial exploration focus will be on uranium, in particular the Bungalow Well project in Western Australia.
Bungalow Well covers about 100 square kilometres with historical exploration detecting uranium mineralisation.
“The uranium market outlook has improved considerably in the last two years,” chairman Zeke Pervan said in the company’s prospectus.
“The strategic importance of uranium as a power source is rising as China’s rapid industrialisation stresses the supply of more traditional energy sources.”
However, the company faces a geographical challenge with most of its uranium projects located in WA, where the state government has taken a very public anti-uranium mining stance.
“It should be noted that in WA the state government has a restrictive policy on uranium mining and processing,” Mr Pervan said.
“Changes in policy may take time to develop but favourable changes to the regulatory environment in WA are expected to have a positive effect on the company.”
But, Uranium Oil and Gas can draw some comfort from fellow explorer Nova Energy Ltd which has started feasibility studies at its uranium project in WA, despite the local government’s opposition.
Uranium Oil and Gas also holds a number of projects prospective for copper, gold, molybdenum and oil in Western Australia and the Northern Territory.
The company’s managing director is William Bannister, a former WMC Ltd senior geologist.
Â© 2006 AAP