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First Uranium eyes asset sale to pay off debt

Ezulwini mine in South Africa

First Uranium is in talks to sell key assets to pay down debt due later this year, the gold and uranium miner said.

The Toronto-based company said late on Tuesday that the sale of its "principal assets" should generate enough cash to meet its financial obligations, including $150-million in convertible debt due in June.

First Uranium owns the Ezulwini uranium mine and the Mine Waste Solutions tailings processing facility, both in South Africa.

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First Uranium also reported lower-than-expected third quarter earnings and slashed its production outlook for its fiscal 2012.

At Mine Waste Solutions, the company now plans to produce 98,000 to 100,000 ounces of gold from a previous forecast of 105,000 to 115,000 ounces.

At Ezulwini, First Uranium said it would not achieve targeted gold sales of 70,000 to 80,000 ounces, and it slashed its uranium sales forecast to 82,000 pounds from a previous 110,000 to 130,000 pounds.

Shares of First Uranium have tumbled more than 80 per cent in the last 12 months as the company has struggled with accidents and work stoppages at Ezulwini, and a permitting battle at Mine Waste Solutions.

AngloGold Ashanti holds a 20 per cent stake in the smaller miner, according to Thomson Reuters data.

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