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Show Rio Alqom Says SE Utah U-Ore Venture Feasible Feasibility studies of Rio ' Algom Mines' Utah uranium properties south of Moab show the deposit to be commercially com-mercially viable, Rio Algom president Robert D. Armstrong Arm-strong told the annual meeting meet-ing of shareholders in Toronto Tor-onto last week. The property, situated in ;he Big Indian area near Moab, Mo-ab, will be developed when a sales contract consistent with the company's marketing policy pol-icy is obtained, Mr. Armstrong Arm-strong stated. He said that discussions with prospective American uranium customers custom-ers are now in progress. Mr. Armsrtong explained hat the deposit is particularly particular-ly significant since it places Ihe company within the zone of the U. S. embargo which effectively prevents the sale of foreign uranium in the U. S. The "Humeca" deposit thus establishes Rio Algom as a potential supplier of U. S.-produced S.-produced uranium to that country's burgeoning nuclear market before it is open t') foreign produced uranium. The anual meeting was also al-so told that the company expects ex-pects to enter a period of some reduction in earnings commencing in the second half of this year. Mr. Armstrong Arm-strong stated that deliveries of lower-priced uranium poundage poun-dage under a contract entered into in 1962 as part of a stretch-out program, will begin be-gin in the second half of the year and will continue through 1971. Delivery of approximat- -Ijui YL BUI jo pjn-U 3U0 A3 lion pounds involved in this contract can be deferred one year ;it the company's option. op-tion. In 19G9 and subsequent years, the effect will be modified mod-ified by the commencement of deliveries at higher prices under sales agreements whicn Rio Algom negotiated in 1966 and 1967, Mr. Armstrong explained. Slightly more than 50 million mil-lion pounds of uranium are involved in these contracts, thereby providing assurance of uninterrupted continuity of operations, Mr. Armstrong observed. ob-served. He noted that the company's comp-any's production capacity Jt Elliott Lake in Canada is "substantially in excess of committed annual deliveries" and that current sales agreements agree-ments represent only a "small portion of the anticipated ton nage which Rio Algom has available. "We are thus in a position to negotiate additional major uranium contracts." In addition, addi-tion, Mr. Armstrong noted, continued improvement in the steel division (Atlas Steels) earnings, which increased by 41 per cent in 1967, is anticipated antici-pated provided that market and economic conditions are favorable. In summation, Mr. Armstrong Arm-strong said Rio Algom is approaching ap-proaching the future with a strong working capital position; posi-tion; a steel division which has developed a momentum of improvement; a well-balanced forward order book for uranium; substantial uncommitted uncom-mitted uranium reserves; a flexible multi-mine position in regards to Canadian uranium ium production capability and a viable uranium deposit within the United States. |