Wednesday, March 26, 2008

In Uranium, declines lead advances as producing countries take a bigger slice of pie

From Bloomberg:

Areva SA, the world's largest nuclear-plant builder, will lose money selling uranium from Niger this year after paying the African state more for mining there, said Yves Dufour, Areva's deputy head of mining.

``We hope to come back to normal margins next year,'' Dufour said in an interview today in Paris. Dufour earlier gave a press conference to detail Areva's operations in Niger and address criticism from local Tuareg tribes.

Mining operations in Canada and other countries will help compensate for Niger, which accounts for 40 percent of Areva's uranium production, Dufour said.

Uranium-producing nations such as Niger, the world's No. 5 supplier of the metal and one of the world's poorest countries, are demanding stiffer terms after global prices rose sevenfold in the past five years. The French state-owned company, based in Paris, agreed in January to pay 50 percent more to Niger for mining there. Areva had already agreed on a 40 percent increase last August.

``The uranium bonanza won't be as great as mining companies had imagined,'' said Landsbanki Kepler analyst Pierre Boucheny. ``Producing countries now want a share of the pie.''

No comments: