Energy Resources of Australia Ltd., producer of more than a 10th of the world's mined uranium, rose the most in almost five months in Sydney trading after it won greater-than-estimated prices for the fuel.

Average received prices rose 36 percent to $25.06 a pound in 2007, the Darwin-based company said today in a statement to the Australian Stock Exchange. It was estimated to get $21.05 a pound, Austock Securities Ltd. said in Jan. 9 report.

Energy Resources, a unit of Rio Tinto Group, will benefit more from expected gains in the spot price of uranium as long-term sales contracts unwind from 2010, Austock analysts led by Tim Gerrard said in the report. The price of uranium for immediate delivery has risen ninefold since 2001.

"In the next three to four years the price will rise so their profits will rise provided they keep their production up,'' Ric Klusman, head of institutional trading at Aequs Securities Ltd., said today by phone from Sydney. "If they can keep their production steady then they are a pretty safe bet for the next five years.''

Energy Resources rose A$1.63, or 9 percent, to A$19.73 at the 4:10 p.m. Sydney time close, its biggest gain since Aug. 23.

Output from its Ranger mine in the Northern Territory rose 14 percent to 11,931 pounds last year, the second highest on record for the mine. The company said it overcame flooding which disrupted output in the March quarter by mining higher grade ore.

Sales Prices

Energy Resources' average sales prices are forecast to increase to as much as $40 a pound by 2010, Austock said in the report. The brokerage increased its uranium spot price forecast to $90 a pound, from $85 a pound, through to 2013, the report said.

Uranium traded at $89 a pound for immediate delivery last week, according to TradeTech LLC, an industry pricing service.

Demand for uranium, used for nuclear fuel, is outpacing supply growth in supply, Chief Executive Officer Chris Salisbury said last month.

Fourth-quarter output fell 7 percent, the company said, without giving a reason. Mining at Ranger was stopped because of heavy rain earlier this month. The company is stockpiling uranium ore to limit the effect of rain, the company said.