BHP, Uranium and the bigger hole

The rise in the spot price of uranium, which might have added value to the take-over investment in WMC has turned into a disadvantage. The production in the current Olympic Dam underground mine has fallen (and continues to fall) and in order to fill the deficit in supply and fulfil forward selling contracts BHP Billiton is having to buy expensive product on the open market, while earning only the previously negotiated price.