Paladin Says Uranium May Rise to $110 a Pound in First Quarter

By Claudia Carpenter

Oct. 18 (Bloomberg) -- Paladin Resources Ltd., which runs a uranium mine in Namibia, expects the price of the metal to rise to as much as $110 a pound in the first quarter of next year, a gain of about 40 percent.

``Availability is the issue,'' Paladin Chief Executive Officer John Borshoff said at a BMO Capital Markets meeting in London today. He forecast first-quarter prices at $105 to $110.

The spot price of the metal that's processed as fuel for nuclear reactors rebounded to $78 a pound last week, halting a decline from a record $138 a pound in June, according to TradeTech LLC, a Denver-based pricing service.

``I heard a utility participated'' in the transaction, Borschoff said. ``It wasn't just some hedge fund.''

Perth-based Paladin plans to produce 900,000 pounds of uranium this year and 2.6 million pounds next year, he said.

Macquarie Bank Ltd., Australia's largest investment bank, this week lowered its 2008 forecast for uranium to $100 a pound, from $140.30, citing in part stockpile sales by the U.S. government in August.

To contact the reporter on this story: Claudia Carpenter in London at ccarpenter2@bloomberg.net .