A new Australian uranium powerhouse valued at Aus$400 million will be created under a friendly merger proposal between Toro Energy and Nova Energy.

The enlarged Toro Energy will be one of Australia's largest uranium explorers and project developers by market capitalization, with a strengthened board and management team to carry through the development phase and into production.

It will own or control advanced resources and greenfields uranium exploration projects in Western Australia, South Australia and the Northern Territory as well as the African nations of Namibia, Guinea and Morocco.

In a joint statement Toro managing director Greg Hall and Nova Energy managing director Dr Tim Sugden say: "This is a paradigm shift for both companies. The new Toro has the potential to have two Australian uranium projects in production by 2012, will have the critical liquidity and financial quantum to take an active part in the uranium sector's increasing consolidation while attracting a wider investor base including domestic and offshore institutions.

"This latter factor in itself will value-add to our scrip and enhance our scope to raise funds, pursue growth organically and by acquisition, significantly reduce project risk and increase development potential."