Saturday, 9 June, 2007

by Ben Sharples
Courier Mail

URANIUM miner Energy Resources of Australia expects to post a first-half loss of up to $10 million, after heavy rainfall at its Ranger mine in the Northern Territory.
ERA, the world's third largest uranium producer, said yesterday it expected to deliver a loss of between $5 million and $10 million for the first half of 2007.

That would compare with a $19.9 million profit in the corresponding half and a $23.7 million profit in the second half of 2006.

ERA had to shut down mining operations and the process plant at the mine near Darwin in late February after heavy monsoonal rain, which dumped 750mm on the site in a 72-hour period.

The company declared force majeure on its sales contracts in early March as a result of the rainfall.

ERA shares yesterday dipped $1.18 or 5.27 per cent to $21.22.

In April, the company downgraded its production forecast for 2007 noting the rainfall event was likely to result in a 35 per cent reduction in output on the 2006 figure of 4478 tonnes of uranium.

ERA said it would stick by the production and sales guidance forecast earlier in the year.

"The anticipated pattern of sales deliveries for the remainder of 2007 should not affect ERA's earlier production and sales guidance, already announced to the market," the company said.

"While sales in 2007 and 2008 are expected to be generally in line with production, the timing of sales in 2007 will be heavily weighted in the second half of 2007."

Energy Resources of Australia is 68.4 per cent owned by major mining house Rio Tinto.