First Uranium reports sales rise

Johannesburg - First Uranium Corporation [JSE:FUM] said on Tuesday that its second-quarter gold sales rose 17.7% from the prior quarter and it is maintaining its full-year outlook, despite problems at both its projects in South Africa.

Gold sales in the second quarter, ended September 30, rose to 40 529 ounces from 34 438 oz in its first quarter. In the same period, uranium production rose 76.8% to 36 006 pounds from 20 361 lb.

Gold and uranium production at the Ezulwini mine, located about 40 km from Johannesburg, was affected by two fatal accidents in the second quarter, which led to work stoppages.

First Uranium said it is reinforcing efforts to attain a safe working environment and has adopted a zero tolerance approach to unsafe conduct.

The company said it remains on track to sell about 70 000 to 80 000 oz of gold from Ezulwini in fiscal 2012, with uranium sales of between 110 000 and 130 000 lb.

At its mine waste solution (MWS) facility, which reprocesses tailings to extract gold and uranium, the company said gold recoveries rose quarter-to-quarter, leading to a 27% boost in gold sales.

Gold guidance at MWS, located 160 km from Johannesburg, was unchanged at between 105 000 and 115 000 oz, despite an ongoing permitting issue.

In September, the South African mining authority withdrew the new order mining right for the project. The company maintains that MWS is not a mine and does not need a mining right to operate. It said it has continued to operate.

First Uranium shares closed up 21% at 23 Canadian cents on the Toronto Stock Exchange. The company has lost 83% of its value since the beginning of the year.