Uranium Zero?

Uranium One’s share-price collapse due to political intrigue in Kazakhstan made it the most visible miner in the broader markets during 21st trading week of the year. The implosion drew extra attention in the business press owing to Uranium One founder Frank Giustra’s ties to former U. S. president Bill Clinton.

• As hinted at by its artsy name, Uranium One was always more of a high-concept play than a proven performer, having been corporately cobbled together in a few short years with development-stage uranium assets spread around four continents and four hemispheres.

But the nitty-gritty task of simultaneously developing several new uranium mines — in all their glorious complexity — proved too much for the management team, and the company posted a mind-numbing US$2.4-billion loss last year, or US$5.24 per share. (Shares traded in Toronto at a mere $1.82 at presstime.)

The company wrote down US$1.3 billion on its Dominion project in South Africa, which it put on care and maintenance, US$1 billion on properties in the United States and US$100 million on its Australian assets, including the Honeymoon project, which was sold off.

It looked like the slate had been wiped clean entering the new year, and Uranium One still had its technically strong assets in Kazakhstan as a foundation upon which to rebuild. The optimistic outlook was confirmed with the February announcement of a $270-million financing and related partnership with a high-quality Japanese consortium.

Alas, as detailed on our front page, the latent craziness of Kazakh politics has flared up again. The aging President Nursultan Nazarbayev is moving aggressively to ensure the country’s rule and wealth passes unquestioned to his family members, while the Russian government is making a strong push to re-establish its preeminence politically and industrially in the former Soviet republic.

At the moment, present-day and former Uranium One management are oddly sanguine about the whole business, arguing that the kerfuffle over the arrest of Kazatomprom’s president and charges of improper sales of uranium assets is overblown.

But that Uranium One stock chart speaks volumes and, as uranium prices keep gaining strength, we wouldn’t be surprised to see more bully tactics from the leaders of a country that still idolizes men like Timurlane.

• We don’t need to go on at length about it in a mining newspaper, but the week was punctuated with one for the history books: the bankruptcy of General Motors — the fourth-largest bankruptcy filing in world history.

The subsequent restructuring plan unveiled by the Obama administration regrettably but predictably both entrenches existing management and union leadership, and scares off potential new private investors with good ideas.

Thus, the plan ensures the automaker’s long-term decline, as root problems are ignored and the company is distracted with the administration’s policy goals of building cars with lower carbon emissions and higher fuel efficiency rather than focusing on consumers’ well-known desire for big, powerful cars and trucks.

Simply put, it looks like GM will be ordered by its majority owner, the U. S. government, to spend money it doesn’t have to build cars no one wants to solve problems like global warming and oil shortages that don’t exist.

• To toot our own horn, this year The Northern Miner editorial team had its best year ever at the recent annual Kenneth R. Wilson awards. The KRW awards are the top prize for trade journalism in Canada and are produced by the Canadian Business Press.

Our six editorial nominations placed the Miner among the top half-dozen of the several hundred trade journals in the country, and we ended up with two wins and two top-fivers: Alisha Hiyate won gold for Latin American Minerals drives into Argentina, Paraguay (in the Best Profile of a Company category); Trish Saywell won silver for Residents of Oklahoma town sue over historic pollution (Best News Coverage); Kip Keen placed in the top five for The path to development in Eritrea (Best Resource/Infrastructure Article); and Susan Kirwin placed in the top five for Yamana CEO proves his mettle (Best Profile of a Company). John Cumming and Brian Sylvester were also nominated in the “Best Editorial” and “Best Profile of a Person” categories. Previous years’ winners and nominees included John Cumming, Gwen Preston, Trish Saywell, Susan Kirwin and Anthony Vaccaro.

Send your Letters-to-the-Editor and other op-ed submissions to the Editor at: tnm@northernminer.com, fax: (416) 510-5137, or 12 Concorde Pl., Suite 800, Toronto, ON M3C 4J2.