Toro Energy In Talks With Asian Investor Groups

Toro Energy Ltd. (TOE.AU) is holding talks with Asian investors interested in its key Wiluna uranium project, the Australian mining company said Monday.

Investor groups are seeking to enter a strategic partnership with Toro through a cornerstone equity investment or joint venture development of the Wiluna project, the Adelaide-based company said, adding discussions had particularly advanced with two potential investors.

Toro in a statement said the talks are incomplete and may, if successful, take further time to complete.

The company said recent takeover offers in the mining industry, including Rio Tinto PLC's (RIO) bid for Canadian uranium company Hathor Exploration Ltd. and the offer by Chinese suitors for London-listed Kalahari Minerals PLC (KAH.LN), "indicate the major players in the uranium market remain optimistic regarding the future of uranium."

The company said it expects a "significant level of corporate activity" to continue this year as uranium companies capitalize on the current weakness in the market following the disaster at Japan's Fukushima nuclear power plant.

With the temporary closure of nuclear energy capacity in Japan, as well as in Germany, current uranium production appears sufficient to meet demand, Toro said. It said that is set to shift in 2013, when a U.S. deal with Russia to convert decommissioned nuclear warheads comes to an end. Fuel from the warheads accounts for roughly 15% of current annual global uranium supplies.

Toro's flagship Wiluna project is located 30 kilometers southeast of the town of Wiluna in central Western Australia state. The company has said it expects first production of uranium in late 2013.

Toro, which has a market value of roughly A$91.7 million, also is exploring elsewhere in Australia and in Namibia.

-By Robb M. Stewart, Dow Jones Newswires; [phone]; [e-mail]