Transcription of Finance News Network Interview with Black Range Limited (ASX:BLR) Managing Director, Tony SimpsonJames Sweeney: Hello I’m James Sweeney for the Finance News Network. Joining me today for diversified explorer and developer Black Range Minerals
(ASX:BLR) is Managing Director, Tony Simpson. Tony thank you very much for joining us and welcome to San Francisco.
Tony Simpson: Hi James and thanks for having me on.
James Sweeney: Tony, can you please start by introducing Black Range Minerals to our US audience?
Tony Simpson: Black Range Minerals is listed on the ASX, its ticker is BLR. We’ve been around a number of years although I more recently joined the company. Its focus is mainly on energy and mainly in uranium, and our main project is basically here in the United States in Colorado.
James Sweeney: What exactly is the size of the resource?
Tony Simpson: The resource is probably one of the largest resources in the US and probably one of the highest grade resources throughout the world. Its 91mlbs (million pounds) at a global resource of a grade of 600ppm (parts per million) and 600ppm is a very good grade for a global resource. That doesn’t end there, it’s open and there are probably a lot more resources to be found. However, we’re focusing on the 91mlbs at the moment to try and bring them into production.
James Sweeney: And what is the situation with permitting and approvals?
Tony Simpson: We’ve commenced a permit in activities. The permits in activities are probably the longest lead items for us to get through. It takes five quarters of baseline collection and then an 18 month review period once we’ve submitted the documents. We’ve commenced those baseline activities to collect the data that’s required, and we hope to submit the document early next year. It’ll take about 18 months as I’ve said, for the authorities to review the document.
James Sweeney: And when do you hope to go into production?
Tony Simpson: We’re planning to be ready and permitted probably around early 2015. However, nothing goes to plan, so we’re actually hoping or targeting more likely, to be 2016.
James Sweeney: Still on the topic of uranium Tony, it has been almost 12 months since the earthquake and tsunami forced the closure of the nuclear power plant over in Fukushima, Japan. Now the question is, what effect has that had on the nuclear power plants in the United States, as you continue to look at US plants as being customers?
Tony Simpson: Well I think the US has already answered that question. A couple of weeks ago, two more reactors were actually permitted in the US. I think what it’s done for the world and done for the US, is basically look at the more stringent safety aspects of nuclear power. But I have no doubt that nuclear power is the next base load requirement. The US generates most of its power from nuclear energy systems, yet they actually import 85 per cent of the uranium. We believe that energy security is going to be paramount within the Americans’ minds, and not relying on external sources of uranium is what we’re banking on. Our project as I said is based in Colorado and we’ll be able to supply, not all of the US requirements, but go some way towards it.
James Sweeney: Now you have a coal project in Jonesville Alaska. How long have you held this asset and what exactly is taking place?
Tony Simpson: I think Jonesville was an ambitious task for a company like Black Range. It’s certainly not one of my priorities. We’re in discussions at the moment of, you know, doing something with Jonesville but we won’t be doing anything directly. And we’re going to be just focusing on basically, the Colorado uranium project.
James Sweeney: Now on to financials. What exactly is your cash position and who has been backing the company up to this point?
Tony Simpson: We’ve got about $4.1 million in the bank. As I said earlier, we have 91mlbs of uranium at 600ppm in the ground. There’s actually no need for us to drill anymore holes. What we need to demonstrate is that we need to monetarise the pounds that we have. So our funding requirement to get us through the rest of the year is - I think we have enough. And we don’t see ourselves going to the market in the short term anyway, to try and get any more funding. The last time we raised funds was in February last year when people exercised their options within the Company. So we haven’t really rattled the tin for quite a long time in terms of collecting funding. So we don’t really have a backer at the moment, or a single backer and we’re busy building relationships at the moment. I think moving from exploration to production is a different set of people that you actually talk to as well.
James Sweeney: And now onto your share price. Where exactly has it been trading over the last 12 months?
Tony Simpson: We like everybody else, suffered from the incident in Japan and our share price has been pretty low. However, I think our share price lags even against our peers. Because I think, the unknown of whether we’re going to be able to monetarise what we have in the ground, in terms of pounds. So the focus of the Company at the moment is to demonstrate to the investing public, that we can monetarise the pounds that we have in the ground. Our share price at the moment is just on about three Australian cents and at the beginning of the year, was probably trading around eight Australian cents. I think the downturn is again, market related to a certain extent. But judging it against our peers, it’s probably more because we’re not sure what we’re going to be doing with those pounds. If you look at us from an enterprise value, our enterprise value – in other words dollars per pound, our share price probably represents, it’s about 24 cents. And if you look to the average within the industry, it’s about $1.26. So I think once we demonstrate that we can monetarise what we have, there should be a re-rating of the share price for us.
James Sweeney: And the last question Tony. Where would you like to see Black Range Minerals by the end of this year?
Tony Simpson: A long way down the track on the permitting side of it, which would give the investors’ confidence that we can permit this project. The prefeasibility study would be completed, so we will have figures out there so that people can gauge us against the industry. And well on route to bringing the company into production, and hopefully with a re-rated share price.
James Sweeney: And Tony Simpson thank you for the update.
Tony Simpson: Thanks very much for giving me the opportunity.
Ends
