Perth, Australia --- MININGREVIEW.COM --- 02 September 2010 - Paladin Energy Limited "’ a uranium production company with two operating mines in Africa "’ says it is targeting uranium shipments to China in 2011, after signing a preliminary accord with the nation’s second-biggest builder of nuclear power plants.
“Paladin aims to convert a memorandum of understanding with China Guangdong Nuclear Power Group Co. into supply contracts later in 2010 or early next year,” CEO John Borshoff said in a telephone interview here. “The company may then be able to begin shipments in the latter part of next year,” he added.
“Demand in China is strong,” Borshoff said. “The equation of what they will need to what they’re getting doesn’t stack up.”
The initial agreement with China Guangdong Nuclear may lead to partnership opportunities, expansion of a joint venture in Australia’s Northern Territory and long-term sales, Paladin said in a statement last month. “The accord is a natural match because China has less than 10% of its uranium needs by 2020 covered by contracts or mine ownership,” said Citigroup Inc.’s Sydney-based analyst Clarke Wilkins.
“Paladin expects uranium demand to outpace supplies, driving prices higher from their stubbornly static levels this year,” Borshoff said in a conference call with analysts. “Fewer and fewer of the undeveloped uranium deposits remain available to be exploited,” he added.
“The company plans to double uranium oxide production to almost 14 million pounds by its 2016 financial year, from a projected 7 million pounds in the 12 months ending 30 June 2011,” it said in a presentation accompanying the teleconference.