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Tuesday, May 09, 2006

Strathmore Minerals (STHJF) raises $8.7 million

According to this press release, Strathmore placed a bunch of shares and options and stuff to raise a total of $8.7 million in a private placement.

1.7 million flow-through common shares at $3.00 each.
1.57 million units at $2.30 each (one share plus half a warrant for 18 months with a strike price of $3.25).

Total dilution is around 4 million shares.

The spot price of uranium reacted to the news by increasing $1.25 to $42.75 (ok, so the spot price obviously wasn't a reaction to Strathmore). This is a huge jump. Of course the spot market is very small. Most uranium is sold via long term contract, but the spot price gives an indication of where prices are going.

In the news, the Northern Alabama "Brown's Ferry" nuclear power plant was renewed for another 20 years. Also, a Japanese court rejected claims against a potential new uranium enrichment plant. Brazil starts enriching their own uranium for power plant use (not weapons grade). US Congress delays nuclear deal with India.

UPDATE 5/12/06:
On the other hand, this is extremely serious evidence of weapons grade uranium in Iran.
But they said the density of enrichment appeared to be close to or above the level used to make nuclear warheads.

Nuclear power uses 5% enriched uranium. Weapons grade is 95%. The difference is enormous.

UPDATE same day: Now it appears that the uranium is not weapons grade, but simply higher than LEU grade.

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