Uranium One lowers production forecast

Uranium One has lowered its production forecasts for 2007 and 2008 due to the late commissioning of its Dominion mine in South Africa and the delayed completion of a sulphuric acid plant in Kazakhstan. Meanwhile, the company has bought a US town

Uranium One has revised its uranium production estimate for 2007 by 16% from an earlier forecast of 1134 tonnes U3O8 (960 tU) down to some 952 tonnes U3O8 (810 tU).

The reduction is primarily attributed to the delayed commissioning of the company's Dominion mine in South Africa. The first autoclave has been commissioned at Dominion and is now operating at design throughput, Uranium One reported.

In addition, the company's South Inkai uranium processing plant is Kazakhstan has begun production on schedule. However, production targets at the plant have been adjusted due to a temporary shortage of sulphuric acid caused by delays in the completion of a local copper smelter. Uranium One said that it expects this shortage to only impact on uranium start-up projects.

Pre-commercial production of uranium at Dominion in 2007 is expected to exceed 90 tonnes U3O8 (77tU). In Kazakhstan, attributable production forecast for the operating Akdala mine, in which Uranium One has a 70% stake, remains at 816 tonnes U3O8 (690 tU), while pre-commercial production at the South Inkai mine is expected to be 27 tonnes U3O3 (23 tU).

The shortage of sulphuric acid is expected to have an impact on the production ramp-up of both the South Inkai and Kharasan uranium mines. Uranium One is therefore forecasting total production in 2008 of 2086 tonnes U3O8 (1770 tU), down from an earlier estimate of 3357 tonnes U3O8 (2846 tU). It said that together with its Kazakh joint venture partner, Kazatomprom, it seeking longer-term solutions to the sulphuric acid shortage.

By mine, Uranium One is now expecting the following production in 2008: Akdala, 816 tonnes U3O8 (690 tU); Dominion, 907 tonnes U3O8 (770 tU); South Inkai, 227 tonnes U3O8 (192 tU); Kharasan, 100 tonnes U3O8 (85 tU); Honeymoon, 23 tonnes U3O8 (19 tU); and Hobson, 16 tonnes U3O8 (13 tU).

In the longer term, Uranium One is forecasting production of some 3630 tonnes U3O8 (3077 tU) in 2009 and about 4990 tonnes U3O8 (4230 tU) in 2010. These figures assume that production licences are granted for both the South Inkai and Kharasan plants by the first half of 2009 and that the sulphuric acid shortage is resolved in the second half of 2008.

Meanwhile, following its April 2007 acquisition from US Energy Corp of the mothballed Shootaring Canyon uranium mill in Utah, Uranium One has agreed to buy the nearby town of Ticaboo. Uranium One will pay US Energy some $2.7 million in cash for town, which includes a mobile home park, a hotel, a restaurant, a convenience store, and a boat storage and service facility. Uranium One plans to house its workers in the town when it resumes operation of the mill.

Further information

Uranium One

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