17/12/2008 - 13:28

Impact to focus on WA uranium deposit

17/12/2008 - 13:28

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Amid a backdrop of falling base metal prices, Northbridge-based Impact Minerals says it will focus on its Nowthunna uranium joint venture in Western Australia following the state government's decision to lift the uranium mining ban.

Amid a backdrop of falling base metal prices, Northbridge-based Impact Minerals says it will focus on its Nowthunna uranium joint venture in Western Australia following the state government's decision to lift the uranium mining ban.

The company said its 2009 work program was firming following an assessment over the past two months of the revised outlook for the uranium project and ongoing talks with the JV partners.

"It is essential to the Company amid the current uncertainty in global equity markets, the cutbacks in some mining quarters and the euphoria of a pro-uranium mining WA election result, that the right decision is made about Nowthanna's future," Impact' managing director Mike Jones.

"There is no doubt the recent overturn by the WA Government on the ban on uranium mining in that state has been very positive for uranium miners and explorers - and will clearly precipitate significant developments in this field over the next 3-5 years.

"Nowthanna is being moved up the scale in 2009 so that it can be one of the early players in the emergence of a modern-era uranium exploration sector in WA.

"And, unlike falls in base metal prices which lead to major falls in orders, greater stockpiles and the marginalisation or closures of mines, the current easing of long-term prices for uranium to realistic and sustainable levels, favours demand for new production and mines.

He added that despite the equity market collapse in the past six months, current uranium prices were significantly ahead of what they were eight years ago, and this was influencing the forward thinking on Nowthanna.

"The spot price cost per pound of U3O8 just eight years ago was US$9.20. It soared to US$130 12 months ago and is now around US$55. More critically, long-term contract prices, on which we base Nowthanna's potential, are now around US$70 and steady," Mr Jones said.

"These price increases, the swing to the security of nuclear power as a base load electricity provider and climate change pressures, are driving the renaissance of the uranium sector and it should now have a positive outlook for at least 20-25 years."

Impact will concentrate on increasing the resource at Nowthanna.

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