Yamana Gold (AUY) starts up new mine and gives operational update

YAMANA GOLD INC. (TSX:YRI.TO – News)(AMEX:AUY – News)(AIM: YAU) is pleased to provide an update on the start-up of its Chapada copper-gold mine and a production update for its Sao Francisco and Jacobina mines, its two other principal gold mines in Brazil. Yamana operates six mines in Latin America, five of which are in Brazil including the Chapada, Sao Francisco and Jacobina mines. The Chapada mine is Yamana’s largest mine. The period ended September 30, 2006 is the first quarter of commercial production at the Sao Francisco mine and the first full quarter in which Yamana has owned the Jacobina mine. Yamana is also in the process of assuming ownership of the advanced stage Gualcamayo project in Argentina resulting from its successful take-over bid of Viceroy Exploration Ltd.

Production Update

Yamana is also providing a production update. Milestones achieved and events occurring in the three month period ended September 30, 2006 include the following:

– Total production for the third quarter of approximately 89,000 ounces of gold from its five other producing gold mines, consistent with mine plans.

– Upward trend in production at its Sao Francisco mine with monthly production increasing from approximately 8,800 ounces of gold in July to over 10,600 ounces of gold in September for total quarterly production of approximately 29,600 ounces of gold (including pre-commercial production in July).

– Production at the Jacobina mine of approximately 19,300 ounces of gold which is consistent with the mine plan.

– Initiation of cost improvements at the Sao Francisco mine primarily related to elimination of duplicated costs as the mine undergoes the transition from construction to operations.

– Initiation of production and cost improvements at the Jacobina mine including a change in mining method to reduce dilution, and the start of the initial phase of the Jacobina expansion which will result in throughput capacity increasing to approximately 5,000 tpd in the fourth quarter of this year. This is being achieved through the installation of an additional crusher and screening circuit. Yamana will continue to expand at Jacobina with capacity rising to 6,500 tpd by mid to late 2007 and up to 8,500 tpd by late 2008.

– Continuing development at Morro do Vento and other areas of the Jacobina mine to accommodate the increase in throughput at the plant.

Analysis: Good news here with rising production and lower costs as we move forward. This company is a buy.…

Peak Oil update: Coal no salvation

This is not about how horribly polluting coal is. It’s not about how dangerous coal mining is. It’s not about how much it contributes to carbon emissions and thus to global warming.

No, this is to fight the meme that coal is plentiful.

If you consider a linear growth in demand for coal, the average demand over 2005-2050 will be 2.5 times current demand, which means that we’ll have used 112 of these “reserve-years”, and, at 4 times current production in 2050, we’ll have about 10 years left of reserves worldwide at that rythm of production (not even considering if these reserves will actually be accessible and usable at such rates).

The same calculation for the USA, if you consider that demand for coal on current trends (+71% between 1975 and 2005) is roughly set to double, would lead to conclude that in 2050, at those then prevailing rates of production, the USA would still have 90 years of coal reserves.…

US to speed reactor approvals

The new head of the Nuclear Regulatory Commission thinks he can cut the time it takes to license a nuclear power plant in half, to about two years.

Chairman Dale Klein will have many opportunities to try: The commission expects applications for 29 new nuclear power plants ahead of the 2008 deadline to get federal incentives. That includes nine reactors in Texas.

If it takes about 48 months to actually build a plant, “42 months to license seems a bit long,” Mr. Klein told reporters Friday. He said it’s “not unreasonable” to cut that licensing time in half without compromising safety.

“We look at too many little things and miss the big things,” said Mr. Klein, who was assistant to the secretary of defense for nuclear and chemical and biological defense programs before taking his current job in July.

Cutting the time it takes to license a plant could help some companies put plants into production more quickly, especially those in the very early planning stages.

For consumers, it could mean getting the relatively cheap and clean nuclear electricity sooner. And it could also pressure the U.S. government to resolve the issue of where to store nuclear waste.

“We’ve been sort of counting on the more traditional time of 3 ½ years. If they can do it quicker, that’s good news, but we’d rather everybody feel comfortable with it,” said Steve Wynn, president of NRG Texas, which plans to build the next nuclear reactor in the state, by 2014.

The U.S. has 103 nuclear power reactors, which generate about 20 percent of the country’s electricity.

NRG Texas said in June it plans to build two more reactors at its South Texas Project and expects the first to be in production by 2014.

Last month, TXU Corp. announced plans to build up to six reactors at three sites across the state by around 2015 to 2020.

And on Friday, a spokesman for Exelon Corp. said the company plans to apply for a license to build one nuclear plant in Texas. Exelon spokesman Craig Nesbit said the company is evaluating eight sites in Texas, none of which has a nuclear plant now.…

Dune Energy aquires additional Barnett shale property

The Agreement provides that we purchase Voyager’s remaining properties, consisting of 2,457 gross acres, in two separate closings for total consideration of $32.8 million. Management estimates that these properties contain proved reserves totaling 29.9 BCFE plus probable reserves totaling 16.1 BCFE, for a total of 46 BCFE, representing an acquisition cost of $1.09 per MCFE for proved reserves and $0.71 per MCFE for proved plus probable reserves.

On October 10, 2006, Dune purchased an initial $7.0 million of Voyager’s remaining properties. The new Agreement provides that the balance of Voyager’s assets, totaling $25.8 million, be acquired by Dune on or before January 19, 2007. Dune’s obligation to purchase such remaining assets is subject to financing.

The assets purchased on October 10, 2006 consist of 857 gross acres, two producing wells thereon, and two wells drilled and scheduled for fracture stimulation prior to year end. There are also a total of 18 additional drilling locations, three of which management presently anticipates will be drilled horizontally. The two producing wells that Dune acquired in this closing are the Underwood and Smith-East wells, which Dune placed on production August 30, 2006 and September 7, 2006, respectively. Management has estimated proved reserves totaling 11.9 BCFE and probable reserves totaling 3.5 BCFE were acquired at a cost of $0.59 per MCFE for proved reserves and $0.45 per MCFE for proved plus probable reserves. Dune drew down $4.0 million from its Senior Credit Facility in connection with this purchase.

The remaining Voyager assets totaling $25.8 million consist of 1,600 gross acres, with 29 additional drilling locations identified. Up to one third of this acreage is expected to be drilled horizontally. Management has estimated that these properties contain proved reserves totaling 18 BCFE and probable reserves of 12.6 BCFE, representing a potential acquisition cost of $1.43 per MCFE of proved reserves and $0.84 per MCFE for proved plus probable reserves.

Analysis: More property in the fairway of the hottest gas play in the US. Awesome move and we might have caught the bottom on this one as we are up 31% in just a few weeks. We are entering the best part of the year for gas prices so it looks like all system go. I would buy on a pullback.…