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First Uranium seeks funding

Aerial view of
First Uranium’s
Ezulwini mine
Johannesburg, South Africa — MININGREVIEW.COM — 18 February 2010 – Emerging South African metals company First Uranium Corporation “’ which mines uranium and gold in South Africa “’ says it is involved in talks about securing additional funding to cover operating losses at its Ezulwini mine and to finance another uranium project in the country.

“We are engaged in a process to secure sufficient alternative financing,” Gordon Miller, president and CEO of the Toronto-based company, said in a statement here.

First Uranium revealed earlier this month that its financial position might be severely compromised after authorities in South Africa’s North West Province withdrew environmental authorisation for a new project in the region.

While the company was told subsequently that the approval had been reinstated, First Uranium said it was unable to restart the initiative because of “conflicting and ambiguous” information regarding the scope of the project. “If discussions with authorities aren’t successful, the environmental authorisation may be of limited or no value to First Uranium,” it said.

The company will require as much as US$150 million (R1.1 billion) to complete projects and fund existing operations, RBC Capital Markets said in a note earlier this month.

Simmer & Jack Mines Limikted “’ the South African miner with a 37% stake in First Uranium, said it had formed a committee to decide what to do with its holding.

For the three months to 31 December 2009, First Uranium posted a consolidated loss of US$14.4 million (R108 million), compared with a profit of US$1.3 million (R9.75 million) a year earlier.