The Conversation (0)
Feb. 21, 2013 04:30AM PST
This week, the uranium spot price fell 50 cents, to $43 per pound U3O8; however, the market is anticipating higher prices down the road.
The uranium spot price fell 50 cents, to $43 per pound U3O8, this week; however, according to TradeTech, deals involving delivery later in the year concluded higher than those involving immediate delivery, which means that the market should see higher prices later down the road.
A number of major producers have reported increased production levels for 2012. Total uranium output from AREVA’s (EPA:AREVA) operations reached a record high of 9,760 tonnes in 2012, a company press release notes. Rio Tinto (NYSE:RIO,ASX:RIO,LSE:RIO) also posted positive production results for the year, according to TradeTech. Total uranium production from its operations in 2012 increased 38 percent over 2011, reaching nearly 9.8 million pounds U3O8. Paladin Energy (TSX:PDN,ASX:PDN) reported H2 2012 output of 4.12 million pounds U3O8 — an increase of 34 percent compared to the same period in 2011, stated Energy Business Review.
The US Department of Energy (DOE) is set to release a draft environmental impact statement this March concerning 31 uranium mining leases covering 25,000 acres between Naturita and Moab, Utah, reported the Telluride Daily Planet. The federal agency is hoping to overturn an October 2011 federal court ruling dictating that it cease mining-related activities through its leasing program due to a number of environmental concerns. Energy Fuels (TSX:EFR), which operates the Piñon Ridge mill, owns some of the 31 DOE leases, which could supply ore for the mill.
In May, International Atomic Energy Agency (IAEA) officials will be visiting Tanzania to assess preparations for uranium exploration at the Mkuju River uranium project, reported local Tanzanian publication The Citizen. The Tanzanian government is expected to sign a Mining Development Agreement with the project’s developer prior to issuing mining licenses. The project would make the East African nation one of the top 10 uranium mining countries on the African continent.
Hongyanhe, China’s first nuclear plant post-Fukushima came online this week, reported United Press International. One generating unit is now operational and construction of the entire plant, which will consist of four power-generating units, is expected to be completed by the end of 2015. Two additional power-generating units will follow in 2016. Once completed, Hongyanhe will generate 45 billion kilowatts of electricity per year. China has a goal of 70 gigawatts of installed capacity by 2020 and is expected to reach 42 gigawatts by 2015.
Russian and Jordanian leaders are meeting this week to discuss Russian aid in uranium mining as well as in building the Middle Eastern nation’s first nuclear power plant and the necessary infrastructural development, according to the Azeri-Press Agency. Russia’s Rosatom is a contender for a potential contract to build the plant.
The Japan Atomic Power Company and Marubeni Utility Services signed a memorandum of understanding with the National Nuclear Center of the Republic of Kazakhstan for cooperation in building the first nuclear power plant in the Central Asian nation. “Areas covered by the latest MOU include cooperation on project development, human resources development, feasibility studies, and the construction and operation of a nuclear power plant,” a World Nuclear News report states. The agreement follows earlier deals, signed in 2007 and 2010, which arranged for cooperative studies to determine the feasibility of constructing nuclear power plants in Kazakhstan.
South African government officials announced this week that the country, which currently obtains about 90 percent of its energy from coal, intends to construct additional power plants. South Africa is home to the continent of Africa’s only nuclear power station. Speaking at the Africa Energy Indaba conference in Johannesburg, Energy Minister Dipuo Peters said his country cannot underestimate “the role that natural gas and nuclear power can play in the realization of that 2030 low carbon energy vision,” the Global Times reported.
Company news
Uranium Resources (NASDAQ:URRE) restructured its financial surety bonding for reclamation activities at its South Texas projects. Under the new arrangement, the company has secured $9 million in new surety bonds that require only $4.5 million in cash collateral compared to the existing $9 million in fully collateralized bonds. That will allow the company to return $4.5 million to its treasury.
“The restructuring of the bonding on our South Texas properties is a meaningful step forward as we continue to work on recapitalizing the Company, while simultaneously lowering our cost structure,” stated Terence J. Cryan, interim president and CEO of Uranium Resources, in a press release. “The additional capital provides added flexibility to advance our near-term priorities, which are focused on developing our significant New Mexico uranium assets, as well as maintaining our restoration activities in Texas so as to be positioned to restart uranium production in South Texas in the future.”
Alpha Minerals (TSXV:AMW) and its joint venture partner Fission Energy (TSXV:FIS) released additional results from the drill program on the Patterson Lake uranium project in Saskatchewan. “The highest point reading of the high grade was 76,233 cps. The high grade section within the Upper Zone includes: 20 meters from 87-107 meters down hole greater than 10,000 cps [including] 9 meters from 96-105 meters down hole greater than 45,000 cps,” states the press release. Further results will be released when data compiling is completed.
Macusani Yellowcake (TSXV:YEL) announced the first drill results from its campaign on the Tupuramani property in Peru. “The results to date are similar to the drilling intersections obtained within Colibri 2 & 3 with multiple wide intersections of up to 60m thick, from surface, with uranium grades ranging from 0.3 to 0.6 lbs/ton within the first 100-110m from surface,” states the news release. The company is currently operating two drills on the property.
“These new uranium assays from drilling at Tupuramani demonstrate the real economic potential of the Colibri 2 & 3 sector of the Macusani plateau,” commented Dr. Laurence Stefan, president and CEO of Macusani. “If positively confirmed by drilling this mineralization style has the potential to become a significant open pit mining resource,” he added.
Securities Disclosure: I, Melissa Pistilli, hold no direct investment interest in any company mentioned in this article.
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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.
