Japanese companies buy into Mega uranium project

TWO Japanese companies will buy into the Lake Maitland uranium project in Western Australia after owner Mega Uranium sold a 35 per cent stake for $77 million.

Canadian company Mega has signed a non-binding agreement with Itochu Corporation, the world's second largest uranium trading house, and the Japan Australia Uranium Resources Development Co (JAURD). JAURD represents three Japanese utilities - Kansai Electric Power Company, Kyushu Electric Power Company, and Shikoku Electric Power Company.

Under the proposed farm-in and joint venture deal, Itochu and JAURD will make staged payments of $US49 million ($A77 million) which will go towards feasibility studies for Lake Maitland.

The deal is subject to due diligence, approvals from the boards of all three companies and approvals from the necessary regulatory bodies.

In a statement, Mega Uranium said that, together with JAURD and Itochu, it could meet the capital expenditure requirements for the project, which has an estimated capital cost of $US85.1 million.

The mine is projected to produce $1.65 million pounds of uranium oxide each year over a mine life of 10 years. First production is slated for 2011.

Mega recently sought approval from the state government to mine the deposit located 130 kilometres southeast of Wiluna.

PANORAMIC RESOURCES

NICKEL miner Panoramic will con-soli-date its ownership of the Lan-franchi project by issuing $9.72 million worth of shares to joint venture partner, Canadian-based Brilliant Mining Corp.

Panoramic has agreed to buy Brilliant's 25 per cent stake in Lanfranchi, which will boost its in-ground nickel resources to more than 20,000 tonnes, making it one of the country's major nickel sulphide miners.

Panoramic will issue 12 million ordinary shares, escrowed for six months, and issue 3 million unlisted, non-transferable options at an exercise price of $1.50 each and expiring in December 2012.

The deal is subject to due diligence and shareholder approval. Should Brilliant shareholders approve the sale, the company will own a 6 per cent stake in Panoramic.