Paladin, Energy Resources Shares Rise as Uranium Price May Gain

By Angela Macdonald-Smith

Aug. 14 (Bloomberg) -- Paladin Energy Ltd., the Australian producer of uranium in Namibia, gained the most in seven weeks on speculation prices for the metal may rally as Cameco Corp., the biggest producer, faces potential delays at a mine in Canada.

Paladin, based in Perth, advanced as much as 50 cents, or 10 percent, to A$5.47 in Sydney trading on the Australian stock exchange. The stock was at A$5.43 at 1:53 p.m. local time. Energy Resources of Australia Ltd., owner of the producing Ranger uranium mine, and explorers Curnamona Energy Ltd., Bannerman Resources Ltd. and PepinNini Minerals Ltd. also rose.


Saskatoon, Saskatchewan-based Cameco said Aug. 12 it stopped pumping out water from the flooded No. 1 shaft of its Cigar Lake mine after the pumps were overwhelmed. The mine, due to start production in 2011, is the world's largest untapped deposit of uranium,

``Further delays are likely to put upward pressure on spot and contract uranium prices in the near term in our view.'' UBS AG said in an Aug. 13 report. ``We expect Paladin and the other uranium miners to benefit from the potential for contract and spot uranium prices to improve.''

Darwin-based Energy Resources, controlled by Rio Tinto Group, rose as much as A$1.76, or 9.4 percent, to A$20.59 in Sydney. Curnamona Energy gained as much as 20 percent, while Bannerman advanced as much as 11 percent and PepinNini as much as 10 percent.

To contact the reporter on this story: Angela Macdonald-Smith in Sydney at amacdonaldsm@bloomberg.net