The Chinese are paying an initial U.S. $6.5 M for Rio’s 69% stake (36,222,566 lbs. U308) and up to an additional U.S. $100 M, contingent upon the mine’s net income over the next 7 years. The estimated total cost of the sale is roughly U.S. $2.94/lb. U308.
This last figure is an important one, as it establishes a benchmark sale price for Namibian lbs. at current spot prices: ~$2.94/lb.
One can begin to get an idea of the types of offers with which nearby Namibian developers may be approached. Forsys Metals, for instance, could expect an offer at going spot prices of approximately U.S. $338.1 M or U.S. $2.08/sh. And Deep Yellow could expect an offer of up to U.S. $306.3 M or U.S. $1.52/sh.
One thing is for certain, Namibian lbs. are being acquired at fire sale prices. It will be interesting to see if CNUC continues its regional uranium rollup strategy.