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Uranium Miners in Namibia Face Rise in Water Price, Paladin Says

April 4 (Bloomberg) -- Uranium miners in Namibia, already coping with water shortages in the semi-arid Erongo region, face a steep rise in costs, Paladin Energy Ltd. said.

“When we get it, sometimes we have problems with the quality of the water and the cost,” said Simon Solomons, managing director of Paladin’s Langer Heinrich mine. “At the moment there is no long-term solution to the water-supply situation.”

The mines operated by Paladin, Rio Tinto Plc and China General Nuclear Power Group rely on water from a 20 million-cubic-meter capacity desalination plant operated by Areva SA, a French reactor maker. Areva is in talks to sell a majority stake in the plant to state utility Namibia Water Corp. after shelving its Trekkopje project in 2012 as uranium prices slumped in the wake of the Fukushima disaster.

Namwater has “to look for finance to buy the plant,” Solomons said yesterday during a tour of the Subiaco, Western Australia-based company’s mine. “They will pass on those charges to the uranium mines.”

Calls to Namwater weren't immediately answered.

The three mines, which require as much as 10 million cubic meters of water a year, were previously supplied by the Omaruru Delta aquifer, which has dwindling volumes as demand from the mines and surrounding towns of Swakopmund and Walvis Bay rises.

Langer Heinrich, which consumes 130,000 cubic meters of water a month, has had “no long-term and no firm discussion” with Namwater over supplies, Solomons said.

Namibia is the fourth-largest uranium producer after Kazakhstan, Canada and Australia.

To contact the reporter on this story: Felix Njini in Windhoek at fnjini@bloomberg.net

To contact the editors responsible for this story: Antony Sguazzin at asguazzin@bloomberg.net Alex Devine, Tony Barrett

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