Energy Resources Australia Posts Steep Loss

Energy Resource of Australia Ltd. (ERA.AU) on Wednesday booked a steep annual loss after the uranium miner was ravaged by heavy rains and poor quality ore at its Ranger pit in Australia's Northern Territory.

The subsidiary of mining giant Rio Tinto Ltd. (RIO.AU) posted a net loss for the year to Dec. 31 of A$153.6 million, compared to a A$47.0 million profit in 2010.

On an underlying basis, which smoothes out one-off gains and losses, ERA posted a A$54.2 million net loss, broadly in line with the A$57.9 million average of five analysts' forecasts compiled by Dow Jones Newswires.

ERA forecast uranium oxide output in 2012 of between 3,000 and 3,700 metric tons compared to 2,641 last year. The miner, however, stressed the number will be highly influenced by rainfall levels over the rest of the wet season.

Last year ERA had to buy uranium from other sources to meet sales obligations, but it said in 2012 sales are expected to be broadly in line with production.

ERA is encountering poorer quality ore at the bottom of the current Ranger pit, at which mining is due to cease this year. ERA plans to commence construction in May of a A$120 million exploration decline to test the untapped Ranger 3 Deeps resource nearby.

-By Ross Kelly, Dow Jones Newswires; 61-2-8272-4692; [e-mail]

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