Released April 01, 2016 | SUGAR LAND
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Written by John Egan for Industrial Info Resources (Sugar Land, Texas)--Nuclear power is "the least-loved form of clean power," but it has a bright future around the world, a uranium mining company executive told attendees last week at the 118th National Western Mining Conference & Exhibition. "On a global fundamentals basis, it is a question of when, not if, [uranium] prices will rise," Stephen Antony, president and chief executive at Energy Fuels Incorporated (TSX:EFR) (Lakewood, Colorado), told several hundred attendees at that event, which was organized by the Colorado Mining Association (CMA) (Denver, Colorado) and held in Denver, Colorado.
Antony said "hundreds of billions of dollars are being invested around the world" to build new nuclear reactors. China has 24 reactors totaling 27,000 megawatts (MW) under construction, and an additional 176 reactors totaling 200,000 MW are planned or proposed. China, which has 27,000 MW of nuclear generating capacity already operating, will have 88,000 MW of nuclear generation operating or under construction by 2020, he predicted.
India has 21 operating nuclear units, six under construction and an additional 60 units that are planned or proposed, he noted. Japan has restarted four of its 50 nuclear reactors that were idled by the Fukushima accident five years ago. In the U.S., four new nuclear units are under construction and one recently began operating. However, these domestic nuclear gains will be offset by nuclear unit closures in California, Wisconsin, Florida and New York.
Around the world, the Energy Fuels chief said there were 440 operating reactors, 65 units under construction and 510 reactors ordered, planned or proposed. "Global electric demand is rising, and air pollution and climate-change concerns increase the urgency" of finding non-emitting sources of power generation, he said March 22. He estimated reactors needed about 1.5 million pounds of uranium to begin operating, and reactors burn through about half-a-million pounds of uranium each year while in operation.
"The inventory overhang is holding down uranium prices," he said. Uranium prices have fallen over the last year: in late-February the spot-market price was about $33 per pound, down from about $40 per pound in late-February 2015. They peaked in the 1990s at over $100 per pound, Antony told attendees at the CMA event. "But current uranium requirements exceed mine production, and production from Kazakhstan, the world's leading producer, has been flattening," he added.
Seeking to capitalize on a global resurgence of nuclear power, Energy Fuels has been acquiring assets and competitors in the U.S. In 2013, it acquired Strathmore Minerals Corporation. Last year, it acquired Uranerz Energy Corporation, which operates an in-situ recovery mine and mill in Wyoming. In mid-2015, it announced a deal to buy an operating South Texas in-situ mine and mill, though that transaction has not yet closed. The firm also has a non-binding letter of intent with Sumitomo Corporation (Tokyo, Japan) to acquire that company's 40% interest in the Roca Honda Project in New Mexico. Last month, Energy Fuels raised about $11 million through a stock offering. Antony said Energy Fuels is the dominant conventional and in-situ producer of uranium in the U.S.
Energy Fuels operates the only conventional uranium mill in the U.S., White Mesa, located in southeastern Utah. That mill, licensed for production of up to eight million tons per year, is expected to process less than one million tons of uranium this year, the company told investors last month. The company also produces uranium at the Pinenut Mine in northwestern Arizona. In addition, it has several mines under development or in various stages of permitting across the Rocky Mountain region as well as several mines currently on "standby" status, meaning they are permitted and developed, but have been idled due to low uranium prices.
The company lost $82.2 million in revenue of $61.4 million in 2015. The net loss was largely attributable to a non-cash asset-impairment charge primarily related to uranium price weakness. But on a pre-tax operating basis, Energy Fuels reported gross profit margins of 39% last year. For more on the company's acquisitions, see May 29, 2015, article--Energy Fuels Resources to Acquire Properties Next to New Mexico Uranium Mine Project.
"The uranium market fundamentals are compelling," Antony told the CMA attendees. He predicted demand would outstrip supply, pushing up uranium prices "as long as the industry can avoid another Fukushima."
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, five offices in North America and 10 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities. Follow IIR on: Facebook - Twitter - LinkedIn. For more information on our coverage, send inquiries to info@industrialinfo.com or visit us online at http://www.industrialinfo.com/.
Antony said "hundreds of billions of dollars are being invested around the world" to build new nuclear reactors. China has 24 reactors totaling 27,000 megawatts (MW) under construction, and an additional 176 reactors totaling 200,000 MW are planned or proposed. China, which has 27,000 MW of nuclear generating capacity already operating, will have 88,000 MW of nuclear generation operating or under construction by 2020, he predicted.
India has 21 operating nuclear units, six under construction and an additional 60 units that are planned or proposed, he noted. Japan has restarted four of its 50 nuclear reactors that were idled by the Fukushima accident five years ago. In the U.S., four new nuclear units are under construction and one recently began operating. However, these domestic nuclear gains will be offset by nuclear unit closures in California, Wisconsin, Florida and New York.
Around the world, the Energy Fuels chief said there were 440 operating reactors, 65 units under construction and 510 reactors ordered, planned or proposed. "Global electric demand is rising, and air pollution and climate-change concerns increase the urgency" of finding non-emitting sources of power generation, he said March 22. He estimated reactors needed about 1.5 million pounds of uranium to begin operating, and reactors burn through about half-a-million pounds of uranium each year while in operation.
"The inventory overhang is holding down uranium prices," he said. Uranium prices have fallen over the last year: in late-February the spot-market price was about $33 per pound, down from about $40 per pound in late-February 2015. They peaked in the 1990s at over $100 per pound, Antony told attendees at the CMA event. "But current uranium requirements exceed mine production, and production from Kazakhstan, the world's leading producer, has been flattening," he added.
Seeking to capitalize on a global resurgence of nuclear power, Energy Fuels has been acquiring assets and competitors in the U.S. In 2013, it acquired Strathmore Minerals Corporation. Last year, it acquired Uranerz Energy Corporation, which operates an in-situ recovery mine and mill in Wyoming. In mid-2015, it announced a deal to buy an operating South Texas in-situ mine and mill, though that transaction has not yet closed. The firm also has a non-binding letter of intent with Sumitomo Corporation (Tokyo, Japan) to acquire that company's 40% interest in the Roca Honda Project in New Mexico. Last month, Energy Fuels raised about $11 million through a stock offering. Antony said Energy Fuels is the dominant conventional and in-situ producer of uranium in the U.S.
Energy Fuels operates the only conventional uranium mill in the U.S., White Mesa, located in southeastern Utah. That mill, licensed for production of up to eight million tons per year, is expected to process less than one million tons of uranium this year, the company told investors last month. The company also produces uranium at the Pinenut Mine in northwestern Arizona. In addition, it has several mines under development or in various stages of permitting across the Rocky Mountain region as well as several mines currently on "standby" status, meaning they are permitted and developed, but have been idled due to low uranium prices.
The company lost $82.2 million in revenue of $61.4 million in 2015. The net loss was largely attributable to a non-cash asset-impairment charge primarily related to uranium price weakness. But on a pre-tax operating basis, Energy Fuels reported gross profit margins of 39% last year. For more on the company's acquisitions, see May 29, 2015, article--Energy Fuels Resources to Acquire Properties Next to New Mexico Uranium Mine Project.
"The uranium market fundamentals are compelling," Antony told the CMA attendees. He predicted demand would outstrip supply, pushing up uranium prices "as long as the industry can avoid another Fukushima."
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, five offices in North America and 10 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities. Follow IIR on: Facebook - Twitter - LinkedIn. For more information on our coverage, send inquiries to info@industrialinfo.com or visit us online at http://www.industrialinfo.com/.
