Tuesday, 16 October, 2007

by Zachary Corones
Egoli

ERA says demand for uranium remained strongEnergy Resources of Australia Limited (ERA) said that although spot prices have weakened the long-term demand for uranium remained strong. The miner delivered its third quarter uranium production 24% higher than last year and reaffirmed its production guidance for 2008.

ERA added that whilst the ore mined in the quarter was 27% lower than in the third quarter of 2006 the ore grade was significantly higher.

Ore milled was 20% lower than in the comparable quarter of 2006 due to the planned annual shut down for mill and other plant maintenance, the company said.

The uranium miner produced 1,363 tonnes of uranium oxide from its Ranger mine in the Northern Territory during the third quarter, down on the previous quarter's figure of 1,490 tonnes.

Force majeure, declared by the company after the February/March weather event, would continue to apply to sales contracts in the first half of 2008 as the backlog of deliveries was cleared, it said.

ERA said it expects Pit 3 at Ranger to be completely emptied of water by November, allowing mining at the bottom of the pit.

The company reaffirmed its guidance that production in 2008 should be restored to normal levels, subject to a normal wet season.

On the weakening spot price of uranium, the miner said its average contractual sales price was only partially influenced by the current market price, due to its portfolio of contracts containing a range of pricing mechanisms.