re: AFLEASE & Uranium............................................
MAJOR CHANGES TO AFLEASE SHAREHOLDING
Source: JSE Securities Exchange - SENS
Posted: 13/01/2005
AFRIKANDER LEASE advised their shareholders on Wednesday, that additional purchases by offshore funds, by Sprott Asset Management and Eastbourne Capital, have increased their offshore base to 65%.
...the well respected Sprott Asset Mgmt group has TRIPLED their holding in AFLEASE to 10%.
It also appears the Kebble-saga is ongoing as they've also apparently now divested the majority of their once near controlling interest of Aflease...repatriating the money back into their JCI investment vehicle - which owns large stakes in Western Area's & RANGY.
Bottomline: Sprott's tripling of their position in AFLEASE speaks volumes.
Anyone following Uranium plays closely ?
Looks like they are in London -
AFLEASE SHARE PRICE SHOOTS UP ON URANIUM SUPPLY CONCERNS
-by Julius Cobbett
Source: The Citizen
Posted: 12/01/2005 The share price of THE AFRIKANDER LEASE rose by as much as 21% to close at R2.30 on the JSE on Tuesday, 11 January, 2005 amid concerns about global uranium supplies, following Monday’s inaugural Uranium Mining Conference in London.
Keyword & concept - the "INAUGURAL" Uranium Mining Conference in London...re:
- always be early to the party !
LONDON (Mineweb.com) -- At the inaugural Uranium Mining Conference held in London on January 10th by stockbrokers Hargreave Hale in conjunction with LM Associates and at which six uranium producers or explorers / developers presented (of which more later this week), the Keynote address concerned the changes in and outlook for the uranium market itself.
The paper was delivered by Dustin J. Garrow, President of International Nuclear Inc., and a seasoned member of the market, with over thirty years’ experience in the uranium and nuclear power industries. His primary conclusions were that the international uranium market is in transition from being inventory-driven to production-driven.
Demand is set to outstrip supply by a considerable margin, the inventories built up during the period of excess (effectively from 1945 to 1986) will not be sufficient to supply the developing shortfall and the uncertainty over potential uranium supply through to 2010 suggests the development of shortages. He contends that the future price trend will accordingly be determined by the price necessary to support new production centres and that a term uranium price at or above US$30 per pound (of U3O8) is not unreasonable.
He also stressed that it is important, when looking at the market, to consider the long-term contract prices that are being struck rather than the spot price, as not much more than 10% of uranium transactions are concluded at spot with the rest in term contracts.
Secondary uranium sources are rapidly declining, notably the US-Russian highly-enriched uranium programme, which has been delivering uranium to the market at the rate of 24m lb per annum and this level is not thought to be viable for the future. In addition China is in transition from being a uranium exporter to importer. And critically, of course, the collapse in market prices through the 1980s and 1990s following record levels at the end of the 1970s (reminiscent of another highly-priced metal) has meant that there was a dearth of exploration during the 1980s and the first half of the 1990s. This was a key feature of some of the producers’ presentations as a number of them have picked up cheap properties and are now looking to develop or joint venture (see separate piece later this week).
As a consequence of market developments, uranium mine production dropped significantly in the first half of the 1980s from approximately 150M lb at the start of the 1980s, when it just exceeded demand, to below 100m lb per annum during the 1990s, while consumption was rising from roughly 150M lb towards 175M lb per annum.
Nuclear power generation has been on the increase over the past decade although during the 1990s there was little freshly commissioned greenfield capacity. This has been due to improved reactor performance, increased fuel burn-up (i.e. the amount of energy recovered from the fuel bundles), extended fuel cycles, and capacity increases of between 5 and 15% at existing plants. The average load factor in the United States has risen from approximately 65% in 1990 to roughly 90% by 2000, while the extension of the fuel cycle now means that the period between refuelling the core in the reactors has extended significantly and now runs at between 18 and 24 months, whereas in the 1970s it could be as short as twelve months. In addition, the average capacity factor for nuclear plants stood in 2003 at 89.6%, compared with 70.6% for coal, while the natural gas-fired plants were operating at only approximately 40% of the time – and renewable, wind-powered plants only operated for one-third of the time.
These increases in efficiency have resulted in considerable cost reduction and in the US nuclear power is now competitive with coal and natural gas ($31-46/MWh post absorption of early plant costs, against $33-41/MWh for coal and $35-45/MWh for batural gas). This is one of the factors that have led to a renaissance of the industry. The present picture shows increases in capacity underway internationally.
China has plans to increase its nuclear capacity and India has several reactors either planned or under construction. Russia is now completing plants whose construction was halted when the old Soviet regime was disbanded. Finland has just ordered its fifth nuclear reactor while France, which uses nuclear sources for 78% of its energy supplies, has agreed to build the prototype for the European Pressurised Water Reactor.
Meanwhile in the United States, 27 reactors are under construction, with 37 planned, thus adding to the 143 reactors already in place. Over and above this, a number of plants are receiving 20-year extensions to their licences. Between March 2000 and October 2004, 30 reactors were granted 20 year extensions to their original licences of 40 years; a further 16 renewal applications have been filed with another 22 expected, meaning that just under half of the installed reactors are expected to receive licence extensions.
All of this points to a sustained shortfall in supply and clear scope for fresh mine production. Given that, as one of the presenting companies pointed out, uranium comprises only 1% of nuclear reactors’ costs, the fundamentals of the market point to sustainable higher prices and a recent academic study suggested that $30-40/lb is not unrealistic for the medium term. Clearly there are other issues at stake given that the market remembers Mount St Helen’s and Chernobyl, but the political will appears to be strong enough for the market to support fresh mine production. "]
Sprott isn't the only smart money getting in early - ie:
Posted: Tue, 14 Dec 2004
[miningmx.com] -- South African gold and uranium miner Afrikander Lease announced yesterday that Eastbourne Capital Management, a California-based hedge fund, bought R50m of debt owed to Randgold & Exploration Ltd. Bloomberg reported that Aflease shares rose 10%, or 15 cents, on the news by the close of trade yesterday. |
