Energy Resources Stops Uranium Mining Due to Cyclone

Rebecca Keenan and Angela Macdonald-Smith
Bloomberg

Energy Resources of Australia Ltd., producer of more than a 10th of the world's mined uranium, stopped mining at its Ranger operation in the Northern Territory because of heavy rain caused by a cyclone.

``When we have heavy rain we pause mining,'' Libby Beath, a spokesman for Darwin-based Energy Resources, said today by phone. ``We are lashing down and making sure everything is secure.''

Tropical Cyclone Helen, with winds as strong as 130 kilometers (81 miles) an hour, may cross the coast and move closer to Ranger and Alcan Inc.'s Gove alumina refinery as soon as tonight, the Bureau of Meteorology said on its Web site. Energy Resources missed contracted deliveries last year after a flood at Ranger stopped production in February.

``It will obviously make an impact on their bottom line and their production,'' said Gavin Wendt, senior resources analyst at Fat Prophets in Sydney.

Energy Resources, a unit of Rio Tinto Group, fell 4 cents, or 0.2 percent, to A$18.95 at 3:12 p.m. in Sydney on the Australian Stock Exchange. It had earlier risen as much as 2.1 percent.

The company is still milling ore at Ranger from stockpiles, Beath said. The mine produced 1,363 metric tons of uranium in the three months ended Sept. 30 last year.

Alcan is taking precautionary measures at its refinery in the far northeast of the Northern Territory, said Stefano Bertolli, a spokesman for the company in Australia. In April 2006, Alcan halted production at Gove for Tropical Cyclone Monica and declared force majeure, allowing it to miss shipments.

Port to Close

The port of Darwin, which exports goods including liquefied natural gas, iron ore, uranium and manganese, will probably close at about 6 p.m. local time, Bruce Wilson, the harbor master, said by telephone. Twelve ships in the port will be sent out to sea at about 4 p.m. to escape the storm, he said.

No commodities carriers are in port and the next LNG tanker is due on Jan. 7, Wilson said. The port will be closed for at least one and probably two days, he said.

``Even if it goes to the south of us, which we hope it will, we're still expecting gale-force winds and torrential rain,'' Wilson said.

Australia's Northern Territory will probably have a busier cyclone season than last year, with an average to above-average number of the storms, it said in October. The average for the region is two to three.

Matilda Minerals Ltd., owner of the Tiwi Islands mineral sands mine in the Northern Territory, may evacuate staff should the cyclone approach the islands, 50 kilometers north of Darwin.

``If it looks like it is heading directly towards the Tiwis or it gets bigger, we will evacuate,'' Managing Director Bruce Maluish said from Perth.

Perth-based Matilda shipped 5,100 metric tons of zircon concentrate to China in the three months ended Sept. 30, it said in an Oct. 31 statement. The cyclone is not expected to affect shipments, Maluish said.

Energy Resources has also evacuated its 30 staff from the head office in Darwin.

 


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