Bannerman Sells Initial 5% In Namibian Project For A$3.9 Million
April 09 2012 - 8:39PM
Dow Jones News
Bannerman Resources Ltd. (BMN.AU) said Tuesday that it has
agreed to sell a minority stake in a key Namibian uranium project,
raising an initial about A$3.9 million (US$4 million) toward the
estimated US$870 million capital cost to bring the Etango project
into production.
Namibia's state-owned mining company, Epangelo Mining Co., will
buy a 5% interest in Bannerman's local subsidiary and has an option
to acquire a further 5% stake, the Australian company said. After
the initial sale, Bannerman will hold 76% of the unit that owns the
Etango project and nonexecutive director Clive Jones and former
director Nathan McMahon will together have 19%.
The agreement comes amid heightening interest in sources of
uranium to power future nuclear power stations. China Guangdong
Nuclear Power Holding Corp. and China-Africa Development Fund this
year bought Australia's Extract Resources Ltd., which is developing
a promising uranium deposit that neighbors Rio Tinto PLC's (RIO)
producing Rossing mine in Namibia.
Bannerman said it has now completed a definitive feasibility
study for Etango, which supports building an operation that would
produce between 7 million and 9 million pounds a year of U3O8
uranium for the first five years and then 6 million-8 million
pounds annually to rank Etango as one of the world's largest
uranium-only projects. Etango is located southwest of the Rossing
mine, near the central western coast of Namibia.
"The number of technically viable, globally significant uranium
projects is small, and there is an emerging consensus that uranium
prices will need to rise substantially in order to incentivize new
supply," said David Smith, chairman of Bannerman. "The involvement
of Epangelo as a key partner in the Etango project designates the
start of a new period in advancing the Etango project."
-By Robb M. Stewart, Dow Jones Newswires; +61 3 9292 2094;
robb.stewart@dowjones.com