For exciting prospects in the Uranium arena look no further than Mega Uranium Limited. This mining company has uranium resources in Australia in the order of 23.6 million lbs. So we can establish that this is no shell company looking for a part to play. Beware; this market sector is producing investment opportunities faster than it is mining uranium.

With a solid asset in the bag we can now take a look at Megas’ exploration activities and try and ascertain a brief glimpse into the future.
Apart from Australia, Mega is active in Argentina, Mongolia, Bolivia and Canada. As an added kicker Mega also has a position in Maple Minerals, which has interests in base and precious minerals exploration properties in Canada. Maple Minerals also has a copper-nickel exploration project in Guinea, West Africa. Our interest is in the Uranium element of the company however the other mineral elements of this company’s composition are also very interesting.

We then ask the question, has the management got the aggressive ambition to pursue other opportunities in terms of acquisitions. Well, they did purchase Uranium Mineral Ventures, the Georgetown Project in Queensland, Australia, Future Metals and Energy Limited, Hindmarsh Resources, along with partial rights in other exciting prospects. Good they are showing us what they made of through their actions, which beats the socks off a good story with no substance.

Charts are always worth some examination as they tell a story just like any other picture. The chart below shows that Mega Uranium has had a considerable rise in recent times. This begs the question; is it too late to jump on board? Well for one reason or another we have failed to acquire this stock in the past. We watched it hit $10.0 and thought that we had missed it completely. However, a correction has come our way with the stock dropping to just under $6.0. But it didn’t breach its 200-day moving average and has shown a strong recovery since rising to approximately $8.0 as we write.

We do find it strange that this uranium miner dropped so much as its underlying asset; uranium has not corrected and continues on its merry path upwards. Not to worry, this is our opportunity to buy and we are happy to buy at these levels.

I lived and worked in Queensland many moons ago, I also played football there for a team called Southport Warriors, and so I know a little about the Aussie psyche. My bet is that they won’t let politics get in the way of a good money spinning deal and when the go-ahead arrives for uranium mining to commence, there will be some frantic action for those mining companies who already have a place in the sun.

27 July 2006