Fabi Lara – Nuclear Power Fundamentals – Opportunities Abound For Investing In Uranium Stocks – Part 2
Fabi Lara, Founder and Publisher of The Next Big Rush, joins me to dig in to the major demand drivers and supply disruption news that is underpinning a longer-term bull market for nuclear power and uranium mining. We then pivot over to a comprehensive review of the opportunities in producers, developers, and explorers in the US, Canada, Africa, and Australia.
This is a longer-format discussion where we initially get into the solid fundamentals of uranium that we discussed in our last conversation (lack of supply from Niger, less supply that anticipated from Kazakhstan, Russian sanctions) having a huge demand layer put on the last few weeks as a flurry of high-profile tech companies have announced going all-in on developing more nuclear energy to fuel their energy-intensive data centers. Microsoft announced teaming up with the utility Constellation to bring 3 Mile Island back into production. Amazon is teaming up with Dominion, Google is teaming up with Kairos power, and DataBank are all considering a number of small modular reactor (SMR) builds by the end of this decade. In a sector that already has seen surging demand from all the traditional reactor builds in the East and Middle East, the push for more SMRs in the West is pushing demand up even further.
We then shift the conversation over from the growing demand to the very pertinent question of where all the new supply will come from in the uranium mining sector. It’s a very nuanced conversation about a number of different uranium stocks throughout the conversation including: Cameco (TSX: CCO; NYSE: CCJ), Kazatomprom, Orano, Paladin Energy (ASX: PDN) (OTCQX: PALAF), Fission Uranium (TSX: FCU) (OTCQX: FCUUF), Denison Mines (TSX: DML) (NYSE: DNN), enCore Energy (NASDAQ: EU) (TSX.V: EU), Energy Fuels (NYSE: UUUU) (TSX: EFR), NexGen Energy (TSX: NXE) (NYSE: NXE), Deep Yellow (ASX: DYL) (OTCQX: DYLLF), F3 Uranium (TSXV: FUU) (OTCQB: FUUFF), CanAlaska Uranium Ltd. (TSX.V: CVV) (OTCQX: CVVUF), IsoEnergy (TSX: ISO) (OTCQX: ISENF), Rush Rare Metals Corp. (CSE:RSH), Stallion Uranium Corp. (TSX-V: STUD) (OTCQB: STLNF), and Forum Energy Metals Corp. (TSXV: FMC) (OTCQB: FDCFF).
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Microsoft Deal Propels Three Mile Island Restart, With Key Permits Still Needed
By Reuters – September 21, 2024
Hungry for Energy, Amazon, Google and Microsoft Turn to Nuclear Power
Large technology companies are investing billions of dollars in nuclear energy as an emissions-free source of electricity for artificial intelligence and other businesses.
By Ivan Penn and Karen Weise – New York Times – Oct. 16, 2024
Nvidia-Backed Firm Eyes Data Center Near Japan’s Nuclear Power
By Shoko Oda and Takashi Mochizuki – Bloomberg – October 17, 2024
Ubitus looking at Kyoto, Shimane and Kyushu as potential sites
Tech giants eyeing nuclear for low-carbon, stable power source
Biden-Harris Administration Announces $900 Million to Build and Deploy Next-generation Nuclear Technologies
US Department of Energy – October 16, 2024
The Nuclear Energy Renaissance Gains Recognition & Uranium Stocks Take Flight
Nuclear energy is resurgent and the uranium sector is benefiting in a big way
Robert Sinn (Goldfinger) – Substack – Oct 16, 2024
https://robertsinn.substack.com/p/the-nuclear-energy-renaissance-gains
Anyone else noticing a trend here. 🙂
It is so funny, that if we speak to oil & gas guys, they have tunnel-vision that “Clearly all these A.I. data centers are going to need more Nat Gas plants to power them.”
>> I’ll politely ask them off-mic, well what about nuclear power as a solution? Which they’ll then dismiss as too costly and too long of lead times… it’s going to be baselode nat gas plants.
Then if we speak the precious metals guys about this topic of where all the electricity for A.I. data centers and EVs and surging electrical demand is going to come from, that they’ll go into “Clearly all these A.I. data centers are going to need massive solar farms to power them, and think about all that silver is it going to require!”
>> I’ll politely ask them off-mic, well what about nuclear power as a solution? Which they’ll then dismiss as too costly and too long of lead times… it’s going to be carbon free solar power.
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Well, in the last few weeks we’ve seen most of the big tech companies Amazon, Google, Microsoft, Nvidia, all signal that they are going in bigly into nuclear power. 😉
Look, I think we are going to need a mix of every power generation method out there to feed the massive electricity needs that are emerging, but it always amazes me at how many people completely skip nuclear power when looking for solutions, or dismiss it as antiquated. Clearly that is not the case, and if anything small modular reactors are the wave of the future.
The reality is that nuclear power is the only carbon-free baseload power source, trumping both nat gas plants (which are baseload but not carbon-free) and solar (which is carbon-free but not baseload). It doesn’t take a nuclear physicist to look at the options the tech companies are presented with and see why they are going with small modular nuclear reactors.
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It is also shocking that we’ve been discussing the supply/demand fundamentals here on the KER for so many years, and yet so many resource investors still have zero exposure to uranium equities or nuclear stocks. (what part of the continued clear message are people not hearing? It’s been in a bull market for 4 years now)
Uranium stocks were so beaten down by 2017-2019, that it was an insane valuation mismatch, and the bear market in the U-stocks was so much worse than the precious metals bear market. It wasn’t an “if?” question but just a “when?” question as to the eventual sector re-rating.
Coming out of the pandemic, most commodities had big moves, but the moves from March of 2020 to late 2021 in the lithium and uranium stocks were far more epic than the moves in gold or silver stocks, which is why it is important to have a diversified approach to investing in the commodities sector and not just get hung up on 1 or 2 commodities tunnel-vision. I sold out of 100% of my lithium stocks and 85% of my uranium stocks in late 2021, and said so publicly in a number of posts here in “real time,” as it was time for a rotation.
Oil and nat gas stocks had their biggest moves from spring 2020 to spring of 2022 (when the Ukraine/Russian conflict began). That was another huge move that many resource investors, that are piled in to only 1 commodity, (and often only tiny junior PM drill plays), completely missed out on. Copper stocks also had a huge run from spring 2020 through May of this year in 2024… another huge trend in the resource stocks that blew right past many resource stock investors. There are also big pops in palladium and nickel stocks a few years back that presented multi-bagger returns.
Back to uranium stocks though and the theme of this interview and blog – the U-stocks consolidated in 2022 and many folks on the internet, or even people we interviewed proclaimed that the uranium bull market was over, but it was clear as day to anyone looking at the fundamentals that there was no way the bull market was over, and if anything we were and still are in the early innings.
When many punters were giving up in despair and throwing in the towel in 2022 and early 2023, I was accumulating all my uranium positions back again just because the fundamentals were (and still are) undeniable for higher prices. Then we saw a huge run in both uranium and the U-stocks during the second half of 2023 and into early 2024, where I trimmed back 20%-30% of my portfolio positions (and mentioned it publicly many times), thinking it was getting a bit frothy again… and it was and the sector corrected. Now the uranium sector did jump back higher again this late spring/early summer, but then the uranium equities rolled over hard and had a consolidation period. Again, people came out of the woodwork on many other sites and proclaimed, (once again) that we’d seen the peak and that the uranium bull market was over. (huh?) If anything the fundamental supply/demand mismatch has gotten even better and better the last few months.
For anyone paying the remotest bit of attention to the fundamental news breaking every month for nuclear power, there is no way one could conclude the bull market in uranium stocks was over…. so I kept adding back to the positions that I’d trimmed earlier in the year. For most of September and October, the uranium stocks have been rallying once again, and just broke above key moving averages in a bullish manner. This is not a surprise for anyone that understands the megatrend still solidly in place.
Then in the last few weeks with some of the largest tech stocks on the planet going all-in on nuclear power, it has become abundantly clear that this bull market for nuclear and uranium stocks is far from over…
Ex: Great points, particularly for baseload. NatGas pricing is showing the effects of this shift in direction; however, I believe that its simplicity for many applications will carry it forward with gusto. It is bottoming now, having been driven down, also, by a campaign which last January even included Brandon! BDC
https://www.tradingview.com/x/xuh3kKod/
NatGas : Retracement & Targets
Deep BOIL Target: 7.60 +/- 10 cents.
Small nuclear modular reactors are definitely the future or should I say the future is already here. I don’t know whether there will be a future for humans when you see the way A.I. is gobbling up all the energy. In Japan when you go into an old age home you can take your robotic dog to keep you company. DT
Well, maybe in the future the machines will make us the power center like the Matrix movies.
Hi Ex, that is scary, scientists just discovered a lake on a pulsar that has 1.45 trillion times the water we have on earth. They are building a new telescope in the Atacama Desert in Chile to monitor it. The trouble is this water is 20 trillion light years away, and we can tell that from a telescope, that is how fast technology is moving. The signal from the pulsar only showed up on earth one billion years ago. LOL! DT
“1.45 trillion times the water we have on earth.”
– That is a LOT of water…
The irony is not lost on me that they are longingly watching this from the very arid Atacama Desert in Chile where water is the most precious commodity.
Few months ago she was on about COSA. Then it was gone and she was on to Myriad. Now it is gone and she is onto STUD. That one is the bottom of the barrel.
https://www.tradingview.com/x/b2tkhbX6/
DOLLAR : Possible Bearish ~Gartley~
Rick Rule will be on BNN at noon EST talking resource stocks, will likely mention Mega Uranium, MGA.v.
Old FREAKY FRIDAY………………… gold at $2717 plus…… what a hoot…..
Stillwater, PGE.v, has jumped over %30 since recent lows and the chart looks great IMO.
PGE weekly.
Makes Sense, with Gold at an all-time high Central Banks in the East in countries like Russia and China will start to move money into palladium, platinum, and silver. All three look like a no brainer compared to gold, and when the physical responds the stocks will too. PGE has Rhodium, at one point Rhodium went to $28,000 an ounce. I believe it is somewhere near $5000 now, if you can buy any. DT
Silver at a 12 year high today!
… will update at end of day… last time at this level was Dec 2012.
Hopefully this is a better chart.
… or this one…
Da Bugs Gonna Be Rich !!
Amazon Goes Nuclear, To Invest More Than $500 Million To Develop Small Modular Reactors
Diana Olick – CNBC – Wed, Oct 16 2024
https://www.cnbc.com/2024/10/16/amazon-goes-nuclear-investing-more-than-500-million-to-develop-small-module-reactors.html