The Conversation (0)
Oct. 05, 2010 02:58PM PST
The market valuation of Canadian companies with one or more uranium projects has appreciated approximately 22 percent over the past month and up 43 percent over the previous 12 months. Share prices of Australian companies with one or more uranium projects have also performed relatively strongly with an 18 percent increase over the past month and 18 percent over the past 12 months.
The market valuation of Canadian companies with one or more uranium projects has appreciated approximately 22 percent over the past month, up 28 percent over the past 3 months, and up 43 percent over the previous 12 months. Despite some concern over the proposed Resources Super Profits Tax, share prices of Australian companies with one or more uranium projects have also performed relatively strongly with an 18 percent increase over the past month, surging 29 percent over the previous quarter, and 18 percent over the past 12 months.
Over the last month uranium mining majors’ share prices have demonstrated a variety of results: Cameco Corp. (TSX:CCO) is up 5 pecent (3 month performance has increased 18 percent); Denison Mines Corp. (TSX:DML) is up 14 percent (3 month performance climbed 26 percent); Uranium One (TSX:UUU) is relatively flat (3 month performance appreciating 28percent), Energy Resources of Australia Limited (ASE:ERA) up 1 percent (3 month performance was slightly negative with 5 percnet depreciation) and Paladin Energy Ltd (ASE:PDN) down 4 percent (3 month performance declining 3 percent).
The Uranium One three month price volatility is attributable to the announcement of the ARMZ transaction; and ERA’s 6 month price decline has been attributed to a number of factors including the impact to sentiment of the decision to subsume nearby uranium deposit Koongarra [Areva Group (EPA:CEI)] into Kakadu NP.
The Merrill Lynch Uranium Equity Index (consisting of a portfolio of uranium equities) has increased 4 percent over the past month, appreciating 9 percent over 3 months and declining 17 percent over the trailing 12 month period.
Short Term Decline in Uranium Prices
The uranium spot price retreated this week losing some of the momentum gained earlier last month. TradeTech reported its Spot Price Indicator at $46.50 per pound, down $1.50 from last week. The reduction in spot price has been the result of a lack of firm buying interest at higher prices, along with the introduction of new supply. Five transactions were concluded last week with buyers including both producers and traders.
The reduced prices attracted buyers back into the market, and new demand emerged late in the week with two buyers entering the market to buy a total of up to 1 million pounds of uranium. A producer issued a Request for Proposal (RFP) for the purchase of up to 500 thousand pounds with offers due at the end of last month.
On the supply side, USEC is expected to issue a proposal this week, on behalf of the US Department of Energy (DOE), requesting bids for approximately 640 thousand pounds of uranium. This material is being sold to fund additional cleanup efforts at the Portsmouth, Ohio enrichment facility.
Spot Price Outlook
With the uranium spot price currently trading at $46.50 per pound, it is up 14 percent from 3 months ago ($40.75 per pound) and still showing an improvement since the start of the year, when it was $44.50 per pound.
Some analysts are now expecting the uranium spot price to find a floor around the $45 to $50 per pound range. This gradual drift in spot and contract prices over the past 12 months reflects in part the tremendous growth in new mine supply from Kazakhstan’s ISR projects.
Recent price influences driving the spot market up to $48 per pound are not entirely clear, though traders point to purchases from major producers. Utility purchases remain discretionary though timing of demand from long term Chinese inventory build remains a factor and will continue to influence short term market trends, as will, increasingly, Japanese and Indian utility purchases.
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Investor Insight
Generation Uranium offers investors high-leverage exposure to a potential major discovery in Canada’s underexplored and resource-rich Thelon Basin, led by a management team with a proven track record of securing high-value exits.
Overview
Generation Uranium (CSE:GEN, OTCQB:GENR, FRA:W85) is a Canadian exploration company focused on wealth creation through discovery within the uranium sector. The company’s primary strategy is to build a high-caliber exploration team that can rapidly test and drill high-potential targets, de-risking projects for potential takeover by larger producers. Currently centered in the prolific Thelon and Angikuni Basins of Nunavut, the company is also actively evaluating additional project acquisitions in the Athabasca Basin to expand its portfolio.
The company is led by a veteran management team with nearly 30 years of experience in mineral development. CEO Michael Collins has a significant track record of building and exiting public companies, including the co-founding of Bluerock Resources, a conventional uranium producer during the 2000-2008 cycle. This expertise is paired with a focused business model that leverages modern geophysical targeting to accelerate exploration timelines and reduce costs, ensuring the company can deliver results quickly in a bullish uranium market.
Company Highlights
- Strategic Location in a Premier Uranium District: The flagship Yath Project is located in Nunavut’s Thelon Basin, contiguous to ATHA Energy’s Angilak Project, which hosts the high-grade Lac 50 deposit.
- High-Grade Discovery Potential: Historical surface sampling at the Yath Project has yielded exceptional uranium grades, including boulders testing at 9.81 percent, 3.95 percent, and 2.14 percent U3O8.
- Expert Management with Exit Experience: Led by CEO Michael Collins, the team has decades of experience in mineral exploration and a history of co-founding companies that were later acquired, such as Prime Mining and Nuclear Fuels.
- Low-Cost, Rapid Exploration Strategy: By leveraging modern geophysics and extensive historical data, the company aims for a "short road to discovery," de-risking projects quickly to maximize shareholder value.
- Bullish Market Fundamentals: Generation Uranium is well-positioned to meet the growing global demand for carbon-free nuclear power, supported by a projected supply deficit and increased interest from major tech companies seeking clean energy.
Key Project
Yath Project - Nunavut, Canada
The Yath Project is Generation Uranium’s flagship project. This 100 percent owned property covers about 120 square kilometers within the underexplored Thelon Basin in Nunavut, Canada. The project is located where the Yathkyed and Angikuni sub-basins meet, which is a region known globally for high-grade uranium potential. It sits directly along the same trend as the Angilak Project owned by ATHA Energy (TSXV:SASK, OTCQB:SASFK, FWB:XSU.F), which contains the Lac 50 deposit, one of the highest-grade uranium resources found outside of the Athabasca Basin with a historical mineral resource estimate of 43.3M lbs at an average grade of 0.69 percent U3O8.
The Yath Project is contiguous to the Lac 50 trend and is crossed by several regional faults and basin boundaries. Past exploration work has already identified high priority targets, while surface sampling in the area has produced uranium grades from boulders, with some testing at 9.81 percent, 3.95 percent, and 2.14 percent U3O8.
The company has commenced its initial field program at the site, set to define and rank drill targets. Historic showings will be combined with new anomalies from the MMT geophysics survey, preparing the project for an anticipated drill permit.
Management Team
Michael Collins - CEO & Director
Michael Collins is a professional geoscientist with nearly 30 years of experience in mineral exploration. He has co-founded several public companies, including Exploits Discovery, Prime Mining (acquired in 2025), and Nuclear Fuels (merged with Premier American Uranium in 2025). He is also currently a director of First Atlantic Nickel.
Christoph Bruening - Director
Christoph Bruening is the founder and managing partner of Value Relations GmbH, a full-service investor relations and public relations agency in Frankfurt with over 25 years of excellence, focusing on mining, exploration, biotech and health care. In addition, he has listed over 600 companies on the Frankfurt Stock Exchange and is a speaker and author of several publications, including on rare earths and uranium.
Dallas Miller - Director
Dallas Miller has been working within the international mining industry for over 15 years, working with BHP and Santos Ltd. He has experience on the ground from an operational standpoint, as well as being an integral part of raising millions of dollars in capital funding for both private and public companies in recent years.
Roger Leschuk - VP Corporate Development
Roger Leschuk has been in corporate management for over two decades, with the past 15 years dedicated to corporate development and investor relations. He has experience participating in and assisting with mergers and acquisitions, and was an investment advisor for various services such as stocks, mutual funds and tax-sheltered investments. He is a Chartered Investment Manager and a Fellow of the Canadian Securities Institute.
Monty Sutton - CFO
Monty Sutton brings over 35 years of experience in public markets and corporate governance. He previously served as CFO for Nuclear Fuels from its IPO through its acquisition.
