Stocks to Buy White Canyon Uranium (WCU)

White Canyon Uranium ASX WCUWhite Canyon Uranium (WCU) is a Perth-based company focused on the exploration, recovery and production of uranium. The company operates in North America as White Canyon Uranium, North America and holds multiple mining claims in the uranium rich area of Southern Utah.

WCU has been in production since 2009, one of only a few companies in the United States who have moved beyond exploration and permitting and into actual production.

The company has just announced the results of the first milling of ore from its Daneros mine, which was in line with expectations.

WCU stands to benefit from recent strength in uranium prices, which have gained 12% this year so far alone.

A milestone year

The past year has been a busy one for WCU, with the group scoring many significant achievements.

Final approvals for WCU’s mine permit for the development of the Daneros Mine came in May, 2009; development of the twin decline mine commenced in June 2009 and the ore was reached in December 2009.

First ore was delivered to the White Mesa Mill at the end of 2009. In January last year the company entered a three year ore treatment agreement with Denison Mines Corp.

Mining has continued on budget and ahead of schedule: by the end of last June, around 20,000 dry tonnes of ore had been stockpiled at Denison’s White Mesa Uranium Mill in preparation for milling of up to 45,000 tonnes in 2010.

WCU has continued the process of securing future expansion through the acquisition of additional tenements within the group’s project areas. New acquisitions include the Radium King, Spook and Maybe in the Red Canyon area and the Hide Out in the Deer Flat area.

On 24 January, WCU announced the results of the first milling of ore from the Daneros mine: a total of 35,635 tonnes of ore was milled over the period November 1, 2010 through December 10, 2010.

The grade was in line with WCU’s expectations and the expense to recover the uranium was less than budgeted.

Production is continuing at the Daneros Mine and WCU have already stockpiled 9,000 tonnes of ore for the next mill run in 2011.

Upbeat on uranium

Uranium, whilst controversial, is a lucrative source of energy in a time when fears have grown about the finite resources of oil, the current weapon of choice for energy.

The outlook for nuclear power worldwide therefore remains extremely positive. Uranium price has soared over the last few months, flying from around US$42 in June last year to present prices flirting around US$70.

Uranium prices are breaking out and are already up 12% for the year so far. Increasing demand and tight supplies are pushing price higher, which is a boon for White Canyon Uranium and its uranium-focused peers.

By 2014, annual global demand of uranium is projected to approach 96 million kilograms.

This is expected to leave a 36 million kilogram deficit, which is likely to result in higher prices both for the metal and for those companies bringing uranium to the market.


WCU has been one of the hot stocks in recent weeks, surging from around 16 cents to 20 cents.

The group is well-placed owing to strength for uranium price, which is forecast for continued growth into the future.

The group this year will receive proceeds from its first processed ore. Production is continuing at the Daneros Mine and WCU have already stockpiled 9,000 tonnes of ore for the next mill run in 2011.

Going forward, WCU will continue to seek expansion opportunities via acquisitions whilst simultaneously increasing its resource estimates as drilling and exploration continues.

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