Uranium One eyes enrichment
Listed miner Uranium One has identified uranium enrichment as an attractive business opportunity.
Uranium enrichment is a critical step in transforming natural uranium into nuclear fuel for use in electricity production.
Starting life as Aflease Gold, Uranium One, which has a primary listing on the Toronto Stock Exchange and a secondary listing on the JSE, was born out of South African mining stalwart Neal Froneman’s vision to create a unique uranium brand.
From gold miner
The company has gone from a junior gold miner to a uranium senior in three years, largely through acquisitive growth.
The company is however now set to focus on organic growth as its project pipeline maps out the commissioning of a new project every year up until 2013.
“We have alluded to the fact that we will begin moving into vertical integration. We can see ourselves bumping our heads if we continue to pursue growth horizontally,” Froneman, president and CEO of Uranium One, said on Monday.
But he cautioned that there were a lot of other steps that the company would take as part of its strategy of vertical integration before it would look at enriching uranium.
Moving quicker
These included transporting the uranium, conversion and the disposal of waste. Uranium One believes it is better positioned to claim a place as one of the world’s top five uranium producers.
“Being a smaller company has allowed us to move quicker,” said Froneman.
The company’s project ramp up will see it go from being a 2.5 million lb-a-year producer in 2007 to 27.9 million lb-a-year producer by 2013.
While the company has made Canada its base ”” with its primary listing on the Toronto Stock Exchange and a secondary listing on the JSE ”” Uranium One’s largest investment to date has been an estimated R1-billion in its Dominion Uranium Project in South Africa.
Diversified risk
Froneman said that the company’s acquisition of Energy Metals Corporation ”” for about C$1.59-billion (some R10.6-billion) ”” has strengthened its presence in the US market, the largest generator of nuclear energy. It has also diversified the company’s political and operational risk.
Uranium One’s resource base is now balanced in three key areas: South Africa, the US and Kazakhstan (including Australia).
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