PacMag shares rise after uranium find

Shares in PacMag Metals have gained after the minerals explorer announced a high grade uranium zone at its Olary joint venture in South Australia.

PacMag is the manager of the joint venture and by the completion of a bankable feasibility study may earn up to 75 per cent equity in the project from Giralia Resources NL, which also saw its shares rise on the news.

PacMag’s shares rose 10.5 cents, or almost 23 per cent, to 57 cents, while Giralia rose eight cents, or 22 per cent, to 45 cents a share, in morning trading.

At 1158 AEST PacMag shares were eight cents, or 17.2 per cent, higher to 54.5 cents, while Giralia was one cent higher to 38 cents.

The Olary project, which is 1,200 square kilometres, comprises two exploration licenses for hard rock and roll front uranium deposits.

“Recent reconnaissance mapping with accompanying rock chip sampling has defined a new zone of strong uranium results on the northern Olary tenement E2939,” PacMag said.

The find will tap into investor fever for uranium stock that has been recently demonstrated by a number of successful uranium company listings on the stock exchange and higher uranium prices.

The interest is being driven by declining above-ground supplies of weapons grade uranium and an international push for cleaner fuels.

Last week PacMag’s shares jumped 23 cents, or 124 per cent, to 41.5 cents, after it outlined a $US25 billion ($A33.58 billion) resource estimate at its wholly-owned Ann Mason project in Nevada, US.

It said the project had a resource of 810 million tonnes grading 0.4 per cent copper and 0.004 per cent molybdenum, in a 64 per cent improvement to the previous estimate.

The copper metal in the resources has an in-ground value of $US25 billion based on current metal prices, PacMag said, and there is still room to further increase the resource.

© 2006 AAP