ERA chief quits as miner books $53m loss

Sarah-Jane Tasker
The Australian

THE head of Rio Tinto-owned Energy Resources of Australia has quit as the uranium miner booked a first-half net loss of $53.5 million.

Chief executive Rob Atkinson has resigned after nearly five years in the job and will move to a role in Rio, it was announced yesterday when the company released its results.

His replacement has not been determined.

The company, in which Rio has a 68.4 per cent interest, said in the short term the uranium market remained challenging, with utilities well supplied. Post-Fukushima, uncertainty remained in the Japanese market.

"The spot price for uranium oxide fell slightly below the $US40 per pound mark at the end of June, the lowest end-of-month price since February 2006," the company said.

Long-term prices remained in the mid-$US50s per pound of uranium oxide with minimal activity, ERA said.

The company outlined that an oversupply of material in the short term was expected to maintain this trend.

The continued low prices are expected to affect new producers causing a supply shortage in the medium to long term, which ERA said meant the longer-term outlook remained encouraging for established producers.

"ERA is well positioned for a stronger market in the mid term, should the Ranger 3 Deeps mine be developed," the company said.

The net loss for the six months to June 30 narrowed from a $59.9m loss in the previous year. ERA's profitability has suffered from its Ranger pit in the Northern Territory running out of ore.

The company plans to make a final investment decision on a new pit at the mine, called Ranger 3 Deeps, by the middle of next year.

The company said that, in light of the financial results and the forecast cashflow requirements for the implementation of its strategic initiatives, the ERA directors had decided not to declare an interim dividend for the 2013 half-year.

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