Iran’s Nuclear Ambitions Highlight Kazakhstan’s Uranium Potential
Whatever agreements are reached at December’s global climate warming summit in Copenhagen, they can only boost uranium’s appeal, as the carbon footprint of a nuclear power station consists primarily of the carbon cost of mining uranium fuel, not a nuclear power plant (NPP)’s operation. According a
Consider – two years ago,
According to the Wall Street Journal on November 29, “
The nuclear issue even impacted last year’s
The story is the same in
Asia’s economic powerhouses
Like
Further accelerating
To be on the safe side,
Despite
The revival of interest in nuclear power in the wake of record high oil prices and despite environmentalists’ opposition will prove a boon for uranium-producing nations. Current global production of uranium is approximately 40,000 tons annually. The math of the analysts quoted above on
But
As with its oil industry,
While the price of uranium in the last several years has been volatile, the overall trend of the last decade has been strongly upwards. In 2001 a pound of uranium sold for between $5 and $10. Current prices in the spot uranium market have trended between $40 and $50 all year after having soared to $140 along with oil in 2007. The 2007 price resulted from the end of Russian dumping, surging apparent increases in demand plus massive liquidity via hedge funds and participation certificates, plus, combining with the difficulty of valuing uranium stocks. Despite these variables, given the projected construction and demand of NPP plants worldwide over the next decade, even a cashiered Wall Street analyst might be able to conclude that the price trend is likely to be upwards.
Rio Tinto's listed uranium subsidiary, Energy Resources of Australia CEO Rob Atkinson, recently commented in The Australian that current relatively low uranium spot market prices combined the effects of the global recession are hampering mine development in a number of countries, setting the scene for a future uranium shortage, noting, “Given production issues that are going on across the world and the (longer-term) demand from power stations, spot prices seem a bit out of kilter at the moment.” Atkinson’s comments echoed an earlier report, as the Royal Bank of Canada Capital Markets noted in a study, "Investing in Uranium Companies," that a supply gap will exist in uranium after 2013. As
NPPs are licensed to run for 40 years, with many re-licensed for another 20 years, new NPPs will not be replacing existing plants, but only adding to demand.
In short,
And, of course,
This article was written by John C.K. Daly of OilPrice.com who focus on Fossil Fuels, Alternative Energy, Metals, <a href="http://www.oilprice.com" target="new">Oil Prices</a> and Geopolitics. To find out more visit their website at: http://www.oilprice.com