POWERTECH STOCK IN FREEFALL
Shares fall below $1.00 US for first time since company switched from water heaters to uranium; investors may not like proposed Colorado mining laws
Posted January 21, 2008, Updated January 25, 2008
Although U.S. financial markets were closed today for the Martin Luther King holiday, Canadian and German stock exchanges were open for business. The Frankfurt Exchange experienced heavy trading in Powertech stock, and the results were not pretty. P8A.F shares dropped 9.33% to 0.69 euros, an all-time low for the company on the German exchange. Canadian shares (PWE.TO) listed on the Toronto Stock Exchange fell 10.53 % to $1.02 Canadian dollars, or $0.99 US.
Powertech stock is at its lowest point since the company sold off its water heater manufacturing operations and handed the reins over to Dick Clement and Wallace Mays in May 2006 to transform it into a uranium development company.
A possible factor contributing to the decline is the realization by investors that Colorado mining laws may soon change. Proposed changes would include a requirement that Powertech and other in-situ leaching operators prove that their marketing claims of ISL mining being completely safe and environmentally benign are true before a permit is issued. While it is certain the proposed bills will be amended, it is possible that one or both of the bills will be passed and signed by Governor Ritter.
Powertech executives insist that mining uranium less than 10 miles from Fort Collins, Wellington, Nunn, Timnath, Pierce, Ault, and Eaton will have absolutely no negative effects on human health, the environment, or the economy. Investors may not be so sure.
Chart for P8A.F (in euros)