UPDATE:Energy Resources 3Q Output Up, On Track For Fiscal Year Target

Uranium producer Energy Resources of Australia Ltd. (ERA.AU) said Wednesday its third quarter production rose 4% on year to 1,405 metric tons and it remains on track to meet full-year output guidance.

The production was 5% lower than in the second quarter due to interruptions to operations to allow extra monitoring of an area of instability in the southern wall of the pit at the company's Ranger mine in Australia's Northern Territory.

The Rio Tinto Ltd. (RTP) subsidiary said precautionary work to stabilize the area should be completed by the end of the year and was not expected to impact full year output.

"It is a routine part of business in an open-cut mine that there can be areas of instability and we have a plan to deal with that now," said ERA general manager of external relations David Paterson.

The company still expects to achieve production at a normal rate, roughly in line with that achieved in the past two years, he said.

ERA produced 5,339 tons of uranium at Ranger in 2008 and 5,412 tons in 2007.

Uranium production for the first three quarters of 2009 stands at 4,100 tons, up 11% on the same period in 2008.

Paterson declined to comment on the prices ERA is achieving for its product, but said the global outlook for nuclear energy remains strong.

"We continue to operate in a carbon-constrained world and we are seeing news around the world of countries that are either looking to extend the life of reactors or to construct new reactors, so the demand for our product remains strong," he said.

-By Alex Wilson, Dow Jones Newswires; 61-3-9292-2094; [e-mail]