Pinnacle Activity Ticker
Uranium Has It All
The considerable potential for higher uranium prices is starting to make its
way into the
public market. This is a commodity which experienced a great deal of attention a
couple years ago as we witnessed its run to $137 per pound. Thanks to a supply
shortfall, combined with a dramatic shift to clean energy production, uranium
prices are poised to dramatically increase once again. Currently uranium trades
at $42 per pound.
Key Fact: Once extracted, uranium (there are two methods) is
processed at a mill, turned into what is known as U3O8 or ‘yellowcake’ and is
then enriched and used in nuclear reactors to create electricity - something no
country, city or home can go without. Currently, nuclear power is responsible
for roughly 19% of electricity in the United States. This number varies from
country to country and is expected to rise exponentially. And therein lies the
opportunity for all of us.
Make no mistake, nuclear energy is a green, clean form of energy that is
being embraced and is highly sought after by developed and developing nations
across the globe. And the pace in which uranium is being accumulated is
Nuclear is far more efficient than any competing energy source and
because of this, uranium has sustained a healthy level of demand over the past
decade. As proactive investors, it must be noted that very soon there will be a
breakout in uranium demand thanks to a global shift towards nuclear power.
Uranium companies have their 'development foot' pressed hard against the
pedal as the largest countries in the world have announced billions of
investment capital will be set aside for the creation of hundreds of nuclear
reactors in the near and long-term. Emerging nations in Asia, most notably
China, are in desperate need of an efficient, clean source of electricity. China
desperately needs to provide its evolving population with a sufficient energy
Key Fact: There are currently 436 nuclear reactors in
Right now there are over 50 reactors under construction
in 13 countries along with 130 nuclear power reactors planned and an additional
250 which are being proposed. (source: World Nuclear Association)
The pressure on governments to move away from dirty energy sources, such
as coal and other fossil fuels is greater than ever. The emphasis developed and
developing nations are putting on nuclear energy is just starting to surface.
Simple logic tells us that demand for uranium will increase in order to sustain
the planned growth and new reliance on nuclear energy. The green movement is a
core fundamental reason uranium's long-term demand will continue to grow and why
we are betting on a substantial price increase.
Uranium is Clean and Green
There is a central theme emerging in almost all aspects of our lives in
the 21st century. The theme is ‘green’ or environmental consciousness.
Governments have never before been so accountable for their actions and are
investing in practical, long-term solutions for our energy needs. Nuclear energy
and uranium are at the core of that shift (multi-billion dollar government
investments) because they represent the only realistic and reliable competitor
to fossil fuels in our never ending drive to create more energy and electricity.
A recent Industry Report from Octagon dated January 19th 2010 clearly
illustrated uranium’s advantages:
"Uranium is a cost-effective and environmentally friendly
alternative to fossil fuels for generating electricity. Approximately 1 kilogram
of uranium produces the same amount of electricity as 16,667 kilograms of coal
or 12,500 kilograms of oil, with the added benefit of no greenhouse gas
emissions and at a lower cost per kilowatt hour."
Those are powerful facts. Most of the general population is unaware of
these statistics and would be shocked to learn how much traction nuclear energy
has been gaining recently. Governments from around the world are waking up to
the above facts and engaging nuclear energy experts to construct new reactors
and to upgrade old ones. The Obama Administration has already taken their stance
as the US desperately needs to stay competitive in the race for a sustainable
clean energy source.
President Barack Obama's recent budget proposal calls for
tripling government loan guarantees for new nuclear reactors.
It would amount to $54 billion in loan guarantees. This followed Obama's pledge
in his State of the Union Address on January 27th in which he proposed to
heavily expand nuclear power production. The administration plans to achieve
this by creating a "new generation" of nuclear power plants as means to develop
less polluting energy sources and to garnish GOP support for the climate-change
bill (now pending in the Senate). This is all part of Obama's 2011 budget and
will create huge profit opportunities for proactive investors.
Obama has called on Congress to pass an energy and climate change bill
with incentives to make clean energy profitable. Obama went on to state that,
"And that means building a new generation of safe, clean nuclear power plants in
Carol Browner, who advises the President on energy and climate change
issues, stated that, "As the world moves to tackle climate change and diversify
our national energy portfolio, nuclear energy will play a vital role."
The message is very clear. The United States is already a leader in
nuclear power, but wants to dramatically increase its dependence on this clean,
efficient source of energy. China is following the Americans, along with many
China has made its mission clear and is leading the...