Uranium was the only commodity to increase in value in February, as the price of nearly every other major raw material declined.
As the push to replace fossil fuels with lower-emission energy sources gains momentum, uranium has exited its decade-long downturn and professionals in the industry are excited about the sector’s future.
Japanese, French, South Korean, Indian, British, and American governments, among others, have all announced new nuclear energy projects and increased support for the sector over the last 18 months. New term contracts and spot purchases have also been made by utilities and financial institutions.
Sprott’s physical uranium trust keeps on buying spot pounds. As a result, utilities are less likely to be able to complete their order books by taking advantage of the discount between spot and contract pricing.
The CEO of Sprott Inc, Whitney George, talked during an interview with BNN Bloomberg about the company’s move to renewable energy and his predictions for precious metals. He says that Sprott Physical Uranium Trust has made it possible for the company to move into the area of energy transition. According to George, uranium prices will see repricing soon as demand keeps going up.
Canada Is a Key Player in the Uranium Resurgence
Although rising prices and the announcement of restarts at some mines indicate that demand may be met in the near term, economists agree that additional production will be needed to keep up with long-term growth projections. Uranium projects in countries like Canada are vital to the nuclear renaissance because consumers of nuclear fuel throughout the world are shifting away from main suppliers Russia and Kazakhstan because of persistent hostilities.
Canada is the world’s second largest producer of uranium and the only country with large, high-grade reserves. In fact, the average grade in Canada’s Athabasca Basin is approximately ten times higher than the world average.
Fission Uranium Corp. (TSX:FCU) (OTCQX:FCUUF), a Canadian resource company, is concentrating its efforts on the development of its Patterson Lake South (PLS) property, which includes a proposed high-grade uranium mine and mill.
PLS is located in the renowned Athabasca Basin uranium district and is home to the region’s only major, high-grade deposit discovered at shallow depth – a significant benefit in terms of building time, technical risk, and competitive cost. In reality, this advanced uranium project has the potential to become one of the world’s lowest-cost uranium mines.
On March 2, Fission Uranium announced that it has filed a technical report for its PLS projection SEDAR in accordance with National Instrument 43-101 Standards. The Feasibility Study (FS), which details a high-grade mining and mill scenario for PLS, is summarized in the Report.
Some of the highlights from the report include an increased mine life of ten years, a lower-than-expected initial capital expenditure, increased mineral reserves, an operating cost of just C$ 13.02/lb, and after-tax NPV 8% of C$ 1.2 billion, and an after-tax IRR of 27.2%.
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