Joyce Banda Must Continue to Pray as Low Uranium Prices Hit Paladin Energy

In January, at the launch of the Government of Malawi, World Bank and European Union Malawi Mining Growth and Governance Support Project, Malawi’s president Joyce Banda hailed Paladin’s contribution to Malawi’s economy and expressed that

“I am praying so hard that the prices [of uranium] will go up as it is the first mining project so we need it to succeed.”

Paladin Energy has been hit by the low uranium prices. It reported an impairment charge of USD 96 million at its Kayelekera uranium mine in Malawi. Paladin Energy’s subisidiary Paladin Africa operates Malawi’s largest mine in Karonga, northern Malawi.

Paladin Energy also announced a half year net loss of USD 193.5 million even though production levels were up at both the mine in Malawi and the Langer Heinrich mine in Namibia.

Simon Tonkin, Patersons Securities, said that Paladin has been tracking well with notable effective efforts to cut costs and increase output. Tonkin confirmed the content of Banda’s prayer; he explained that

“A positive turn in uranium prices would move Paladin into profitability.”

An increase in uranium prices is likely with the restarting of Japan’s nuclear reactors, set for July this year.

Source: http://mininginmalawi.com/2013/02/15/low-uranium-prices-result-in-half-year-loss-of-usd-193m-for-paladin-energy/