Most Popular
1. It’s a New Macro, the Gold Market Knows It, But Dead Men Walking Do Not (yet)- Gary_Tanashian
2.Stock Market Presidential Election Cycle Seasonal Trend Analysis - Nadeem_Walayat
3. Bitcoin S&P Pattern - Nadeem_Walayat
4.Nvidia Blow Off Top - Flying High like the Phoenix too Close to the Sun - Nadeem_Walayat
4.U.S. financial market’s “Weimar phase” impact to your fiat and digital assets - Raymond_Matison
5. How to Profit from the Global Warming ClImate Change Mega Death Trend - Part1 - Nadeem_Walayat
7.Bitcoin Gravy Train Trend Forecast 2024 - - Nadeem_Walayat
8.The Bond Trade and Interest Rates - Nadeem_Walayat
9.It’s Easy to Scream Stocks Bubble! - Stephen_McBride
10.Fed’s Next Intertest Rate Move might not align with popular consensus - Richard_Mills
Last 7 days
Stock Market Trend Forecast 2024 - 15th June 24
Gold Price Consolidating at High - 15th June 24
NVIDIA Stock Market: Price Prediction for the Future - 15th June 24
When Will the Boom/ Bust Rollercoaster End? - 15th June 24
Stock Market Trouble Lies Ahead. Are You Ready For It? - 15th June 24
Stock Market Investor Sentiment - 8th June 24
S&P 494 Stocks Then & Now - 8th June 24
As Stocks Bears Begin To Hibernate, It's Now Time To Worry About A Bear Market - 8th June 24
Gold, Silver and Crypto | How Charts Look Before US Dollar Meltdown - 8th June 24
Gold & Silver Get Slammed on Positive Economic Reports - 8th June 24
Gold Summer Doldrums - 8th June 24
S&P USD Correction - 7th June 24
Israel's Smoke and Mirrors Fake War on Gaza - 7th June 24
US Banking Crisis 2024 That No One Is Paying Attention To - 7th June 24
The Fed Leads and the Market Follows? It's a Big Fat MYTH - 7th June 24
How Much Gold Is There In the World? - 7th June 24
Is There a Financial Crisis Bubbling Under the Surface? - 7th June 24
Bitcoin Trend Forecast, Crypto's Exit Strategy - 31st May 24
Zimbabwe Officials Already Looking to Inflate New Gold-Backed Currency - 31st May 24
India Silver Imports Have Already Topped 2023 Total - 31st May 24
Gold Has Done Its Job – Isn’t That Enough? - 31st May 24
Gold Stocks Catching Up - 31st May 24
Time to take the RED Pill - 28th May 24
US Economy Slowing Slipping into Recession, But Not There Yet - 28th May 24
Gold vs. Silver – Very Important Medium-term Signal - 28th May 24
Is Gold Price Heading to $2,275 - 2,280? - 28th May 24
Stocks Bull Market Smoking Gun - 25th May 24
Congress Moves against Totalitarian Central Bank Digital Currency Schemes - 25th May 24
Government Tinkering With Prices Is Like Hiding All of the Street Signs - 25th May 24
Gold Mid Tier Mining Stocks Fundamentals - 25th May 24
Why US Interest Rates are a Nothing Burger - 24th May 24
Big Banks Are Pressuring The Fed To Losen Protection For Depositors - 24th May 24
Another Bank Failure: How to Tell if Your Bank is At Risk - 24th May 24
AI Stocks Portfolio and Tesla - 23rd May 24
All That Glitters Isn't Gold: Silver Has Outperformed Gold During This Gold Bull Run - 23rd May 24
Gold and Silver Expose Stock Market’s Phony Gains - 23rd May 24
S&P 500 Cyclical Relative Performance: Stocks Nearing Fully Valued - 23rd May 24
Nvidia NVDA Stock Earnings Rumble After Hours - 22nd May 24
Stock Market Trend Forecasts for 2024 and 2025 - 21st May 24
Silver Price Forecast: Trumpeting the Jubilee | Sovereign Debt Defaults - 21st May 24
Bitcoin Bull Market Bubble MANIA Rug Pulls 2024! - 19th May 24
Important Economic And Geopolitical Questions And Their Answers! - 19th May 24
Pakistan UN Ambassador Grows Some Balls Accuses Israel of Being Like Nazi Germany - 19th May 24
Could We See $27,000 Gold? - 19th May 24
Gold Mining Stocks Fundamentals - 19th May 24
The Gold and Silver Ship Will Set Sail! - 19th May 24

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

Japan and U.S. Give Green-light To Nuclear Power, Uranerz Uranium Miner

Commodities / Uranium Jun 20, 2012 - 02:01 AM GMT

By: Jeb_Handwerger

Commodities

Best Financial Markets Analysis ArticleStealthily and without much publicity from the media, developments in the nuclear industry are moving ahead. While the Western nations are beset by their own economic problems they continue to dither about the very source of cheap, inexpensive industrial energy namely the uranium miners.


New Mine Production Required

We note with interest the recent ok by the Nuclear Regulatory Commission for the construction of two nuclear facilities in South Carolina at a cost of $11 billion. These plants are on top of the green-light given over two months ago to two plants in Georgia. All this is occurring after a lapse of over thirty years in such construction. Likewise, Japan has decided to restart nuclear reactors for the first time since the once in a millennium disaster at Fukushima in March of 2011. The Japanese economy clearly can not afford to abandon nuclear power. This may be impacting the long term uranium price which is beginning to budge higher. We may soon start seeing uranium miners breaking out of long 15 month bases

The Western Press continues to be mesmerized by the daily featuring of the latest affairs of Pop Tarts and Hollywood Junkies. Meanwhile, Asian nations are tending to the business of providing safe inexpensive, latest generation nuclear reactors for their populations.

2007 Uranium Mining

Moreover, the aforementioned American nuclear plants are coming to us courtesy of the Japanese Unit of Westinghouse- Toshiba, using a whole new generation of the latest nuclear technologies.

Over in such countries such as Vietnam, Malaysia, China and India amongst others are going full speed ahead in providing a safe, inexpensive source of energy for their developing nations. Interestingly, Cameco (CCJ) recently offered to purchase unused uranium from the shutdown of the Japanese antiquated nuclear reactors. Tokyo declined the offer. The Japanese Prime Minister is on record for reviving nuclear in Japan. Could it be that Japan has intentions of a nuclear renaissance using Toshiba to work at home constructing next generation reactors which are safer and economic?

Industry has learned from the past mistakes. The specific failure at Fukushima was due to the loss of power, resulting in the failure to actively circulate cooling water.

The new age reactors have the ability to provide the passive system of cool water that does not require electrically powered pumps. The new reactors are bidding farewell to outmoded forty year old designs to which the media choose to be completely oblivious.

China waits off stage in need of uranium. Fukushima is not slowing down China's nuclear appetite. A nuclear power industry was held April 6th in Shenzhen attracting over 300 companies all over the world.

Homage was paid to Fukushima, but it did not deter these companies from continuing the development of nuclear energy. In fact at the opening ceremony the Chairman of the Chinese Nuclear Association stated, "The accident at Fukushima does not suggest any end to the nuclear renaissance. It may be a catalyst to continuing the safe development of the industry." Among the over 300 companies attending were Areva, Hitachi and an assortment of mainland companies.

Prime Minister Harper has returned from China with a deal that brings almost $3 billion dollars worth of energy deals which includes uranium from Cameco's motherlode in the Athabasca Basin to satisfy China's insatiable hunger for its domestic expansion into the construction of nuclear power plants.

Recently, Denison Mines announced an important merger with Energy Fuels. The stated intention is to form the largest U.S. pure play uranium producer operating in a country that consumes 55 million pounds a year, but produces less than 4 million pounds of uranium. This represents an ongoing significant shortfall in the supply demand equation.

Were it not for the Russian's supplying uranium to the U.S. as part of the "Megatons to Megawatts" arrangement slated to end in 2013, we would be experiencing major power failures. This is only delaying the inevitable day when in 2013 the Russo-American agreement expires. This can only result in a growing world interest in the American nuclear mining industry.

Enter center stage Uranerz Energy (URZ) who is strategically located in the Powder River Basin in Wyoming surrounded by the big boys, Uranium One and Cameco.

Uranerz Energy map

Uranerz is making excellent progress with mine construction on the plant and well fields. Uranerz could be producing 6-800 thousand lbs by the end of the year.

Uranerz's ace up their sleeve is that their operations use in situ recovery methods that require lower capital costs and use more environmentally friendly methods. Unlike costlier conventional mines, Uranerz could produce uranium in the mid $30's.

The company could be the next major U.S. uranium producer at a time when new uranium supply is critical. The company has a strong treasury, a partnership with Cameco and off take agreements with some of the largest U.S. utilities, which indicates that Uranerz may be best of breed of near term U.S. producers.

Cameco is raising a warchest of $1 billon to acquire junior uranium miners such as Uranerz who are trading at bargain basement discounts. Uranium miners are incredibly cheap due to the Fukushima Disaster and a weak resource market. Rio Tinto made its first acquisition since 2007 outbidding Cameco to buy Hathor for a premium. Could this be a signal that the big boys are just beginning to acquire high quality junior miners located in mining friendly jurisdictions?

We believe major sovereign funds and miners will continue to make strategic investments in this beaten down sector. Cameco already had sufficient cash to operate and this raise may indicate that they are ready to make major moves. Cameco's CEO Tim Gitzel recently said, We are making deals and we continue to scour the world and if we see something that fits for us, we'll move very quickly."

Disclosure: Long URZ and DNN

Subscribe to my free newsletter to get up to the minute updates on rare earths, uranium, gold and silver.

By Jeb Handwerger

http://goldstocktrades.com

© 2012 Copyright Jeb Handwerger- All Rights Reserved
Disclaimer: The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. Information and analysis above are derived from sources and utilising methods believed to be reliable, but we cannot accept responsibility for any losses you may incur as a result of this analysis. Individuals should consult with their personal financial advisors.


© 2005-2022 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in