Paladin's plight to spread

Paladin's admission of delays in its sales process will become the norm as assets flood the market

Want to buy a coal mine? Slightly used but in reasonable condition. How about a uranium project or a diamond operation?

As each day passes, an increasing number of projects are being uncharacteristically spruiked in public. All of which begs the question: Who is going to buy all this stuff?

And the answer is becoming clearer by the day. Buyers are thin on the ground and when they are present, they hold all the cards.

Uranium miner Paladin Energy was punished this morning after delaying the sale of a minority stake in its Namibian uranium mine Langer Heinrich to two uranium processors.

The deal was to be wrapped up by the end of the financial year. That now has been delayed because one of the parties clearly has opted to renegotiate the price.

Earlier this week, Rio Tinto decided to withdraw the sale of its diamond operations ostensibly because it now sees value in the business. The more likely scenario is that no-one was offering the right amount of cash.

With the future ownership of its aluminium business under review, Rio appears to be on a path to reducing itself back to a pure iron ore miner.

This morning, there was further speculation that it is advancing the potential sale of Riversdale, its disastrous foray into Mozambique coal.

Having already written most off the $US3.5 billion purchase price, it appears to be happy just to be rid of the operation.

BHP is well advanced on its asset disposal program, having already offloaded more than $5 billion worth of assets and lining up more to put on the block including a range of metallurgical coal projects.

This sudden flood of major resource assets all hitting the market simultaneously runs in stark contrast to the rush from major mining houses to build, acquire and expand projects during the boom when they were caught short of decent expansion opportunities.

With commodity prices under pressure and China actively attempting to curtail credit growth, prepare for more disappointments from resource groups desperately trying to raise cash through asset disposals.