Uranium Juniors to Consolidate
Source: Investors Chronicle, Mark Heyhoe (11/10/09)
"investors now need to become far more discerning and look at which projects will actually be viable"
Key criteria include project resource and grade, infrastructure (water and power) and jurisdiction. Political uncertainty in Australia, Canada and Kazakhstan means that with predicted supply shortfalls in 2012/13, many end-users are looking to secure geographic diversity of supply now.
However, many existing projects are too small to stand alone and we expect a wave of consolidation to hit the junior sector as license areas are combined. Recent transactions such as those involving Uranium Resources in Tanzania and UrAmerica in Argentina indicate this has already begun. We expect it to continue, especially in Australia, Southern Africa and South America as smaller companies run out of cash and realize they need to merge to survive.