суббота, 28 апреля 2012 г.

пятница, 19 февраля 2010 г.

The Uranium Rush Is On

The considerable potential for higher uranium prices is starting to make its way into the public market. This is a commodity which experienced a great deal of attention a couple years ago as we witnessed its run to $137 per pound. Thanks to a supply shortfall, combined with a dramatic shift to clean energy production, uranium prices are poised to dramatically increase once again. Currently uranium trades at $42 per pound.
Key Fact: Once extracted, uranium (there are two methods) is processed at a mill, turned into what is known as U3O8 or 'yellowcake' and is then enriched and used in nuclear reactors to create electricity - something no country, city or home can go without. Currently, nuclear power is responsible for roughly 19% of electricity in the United States. This number varies from country to country and is expected to rise exponentially. And therein lies the opportunity for all of us.

Make no mistake, nuclear energy is a green, clean form of energy that is being embraced and is highly sought after by developed and developing nations across the globe. And the pace in which uranium is being accumulated is staggering.
Nuclear is far more efficient than any competing energy source and because of this, uranium has sustained a healthy level of demand over the past decade. As proactive investors it must be noted that there will be a breakout in uranium demand thanks to a global shift towards nuclear power.
Uranium companies have their 'development foot' pressed hard against the pedal as the largest countries in the world have announced billions of investment capital will be set aside for the creation of hundreds of nuclear reactors in the near and long-term. Emerging nations in Asia, most notably China, are in desperate need of an efficient, clean source of electricity. China desperately needs to provide its evolving population with a sufficient energy source.
Key Fact: There are currently 436 nuclear reactors in operation worldwide. Right now there are over 50 reactors under construction in 13 countries along with 130 nuclear power reactors planned and an additional 250 which are being proposed. (source: World Nuclear Association)

The pressure on governments to move away from dirty energy sources, such as coal and other fossil fuels is greater than ever. The emphasis developed and developing nations are putting on nuclear energy is just starting to surface. Simple logic tells us that demand for uranium will increase in order to sustain the planned growth and new reliance on nuclear energy. The green movement is a core fundamental reason uranium's long-term demand will continue to grow and why we are betting on a substantial price increase.
Uranium is Clean and Green
There is a central theme emerging in almost all aspects of our lives in the 21st century. The theme is 'green' or environmental consciousness. Governments have never before been so accountable for their actions and are investing in practical, long-term solutions for our energy needs. Nuclear energy and uranium are at the core of that shift (multi-billion dollar government investments) because they represent the only realistic and reliable competitor to fossil fuels in our never ending drive to create more energy and electricity. A recent Industry Report from Octagon dated January 19th 2010 clearly illustrated uranium's advantages:
"Uranium is a cost-effective and environmentally friendly alternative to fossil fuels for generating electricity. Approximately 1 kilogram of uranium produces the same amount of electricity as 16,667 kilograms of coal or 12,500 kilograms of oil, with the added benefit of no greenhouse gas emissions and at a lower cost per kilowatt hour."
Those are powerful facts. Most of the general population is unaware of these statistics and would be shocked to learn how much traction nuclear energy has been gaining recently. Governments from around the world are waking up to the above facts and engaging nuclear energy experts to construct new reactors and to upgrade old ones. The Obama Administration has already taken their stance as the US desperately needs to stay competitive in the race for a sustainable clean energy source.


President Barack Obama's recent budget proposal calls for tripling government loan guarantees for new nuclear reactors. It would amount to $54 billion in loan guarantees. This followed Obama's pledge in his State of the Union Address on January 27th in which he proposed to heavily expand nuclear power production. The administration plans to achieve this by creating a "new generation" of nuclear power plants as means to develop less polluting energy sources and to garnish GOP support for the climate-change bill (now pending in the Senate). This is all part of Obama's 2011 budget and will create huge profit opportunities for proactive investors.
Obama has called on Congress to pass an energy and climate change bill with incentives to make clean energy profitable. Obama went on to state that, "And that means building a new generation of safe, clean nuclear power plants in this country."

Carol Browner, who advises the President on energy and climate change issues, stated that, "As the world moves to tackle climate change and diversify our national energy portfolio, nuclear energy will play a vital role."


The message is very clear. The United States is already a leader in nuclear power, but wants to dramatically increase its dependence on this clean, efficient source of energy.  China is following the Americans, along with many other countries.

China has made its mission clear and is leading the charge when it comes to nuclear energy expansion. Consider these facts derived from the World Nuclear Association website which is
sourced below:
* Mainland China has 11 nuclear power reactors in commercial operation, 20 under construction, and more about to start construction soon.

 * Additional reactors are planned, including some of the world's most advanced, to give a sixfold increase in nuclear capacity to at least 60 GWe(Gigawatt - Electric) or possibly more by 2020, and then a further substantial increase to 160 GWe by 2030.
 * China aims to become self-sufficient in reactor design and construction, as well as other aspects of the fuel cycle.

Most of mainland China's electricity is produced from fossil fuels. In 2006, 80% of China's electricity came from coal, 2% from oil, 1% from gas and 15% from hydropower. A rapid rise in energy demand has created increased power shortages, and the reliance on fossil fuels has led to devastating air pollution.
 
Key Fact: According to the World Bank the economic loss due to pollution is almost 6% of GDP.

In short, the above information explains that China is strongly embracing nuclear power and intends to shift a large percentage of its dependence on energy and electricity to nuclear power. This will have a huge impact on the uranium market and every producer and near-term producer within the sector.
China is just one piece to the puzzle, albeit a large one. As China's massive population of over 1.6 billion continues its astonishing move towards urbanization, its demand for electricity will also increase and reach new highs. China has the money to build efficient nuclear reactors and will not continue to rely on coal. Consider this: 
Of the world's 436 operating nuclear reactors, the United States has 102 and a population of 309 million people. This equates to roughly 10 nuclear reactors per 30 million people. If China were to have 10 nuclear reactors per 30 million people they would have well over 500 nuclear reactors and effectively double the current number of nuclear reactors on earth. We don't expect or think this will happen overnight, but if even a few dozen nuclear power plants are built in China, demand for uranium will surge. And so will its price.
Another powerful fact from a recent Industry Report published by Octagon dated January 19th 2010:
- In all, over 130 power reactors with a total net capacity of almost 150,000 MWe(megawatt electrical) are planned and over 250 more are proposed. Rising gas prices and greenhouse constraints on coal have combined to put nuclear power back on the agenda for projected new capacity in both Europe and North America.

Countries around the world appear to be embracing nuclear energy as nations realize the need to secure base-load power from sources other than from fossil fuels. For example, Sweden lifted a 29-year ban on nuclear reactor construction in 2009 while China, which currently has 11 reactors in operation, is currently building an additional 18, is planning 35, and has 90 more in the proposal stage. -

As of December 2009, the World Nuclear Association reported that 144 million pounds of uranium is required to fuel the 436 operating nuclear reactors around the world. Of the countries that currently operate nuclear power plants, only Canada, South Africa, and Russia are uranium self-sufficient. All other countries require uranium imports to sustain their nuclear power programs -the US aims to be amongst one of the world's self sufficient uranium countries.


Based on 2008 data, approximately 59% of the world's production of 96.5 million pounds of mined uranium originated from Canada (21%), Kazakhstan (19%), and Australia (19%) in 2008.

The Uranium market is entering a period where there could be a significant  shortfall in supply, thus creating the perfect storm for a dramatic price hike.
 Key Fact: Uranium's secondary supply (over 30% of all uranium production) is currently being obtained from three main sources:
1. Nuclear disarmament - Russian Highly Enriched Uranium ("HEU") initiative

2. The U.S. government's uranium inventories
3. The use of mixed oxide ("MOX") and reprocessed fuel.

We estimate that secondary supply sources will contribute approximately 38 million pounds of uranium in 2010.
It is important to know that the Russian HEU initiative has been a major source of secondary supply. The "Megatons to Megawatts" program has contributed approximately 23 million pounds of U3O8 per year to overall supply since 1994. Approximately 20 million pounds of uranium per year is expected to be available via the Russian HEU agreement through to the program's conclusion in 2013. This means that (in 2013) almost 25% of the current annual uranium production will be gone.


With the expected increase in demand for electricity and the planned construction of hundreds of nuclear reactors, this will only create one thing: heightened demand for uranium.
 
More Uranium Is Needed
Of the 436 nuclear reactors in operation, they have a total capacity of 372,707 MWe and provide about 15% of the world's base load electricity. Coal, natural gas, and oil comprise the majority of the remaining 85%. These numbers are in the process of changing as the world moves away from fossil fuels and towards clean energy.

 
Get It While You Can' Global Mentality
Over the past few months the uranium M&A market has been heating up. Our team believes we are entering a period of increased uranium asset acquisitions. As China, India and the rest of the world look to secure uranium reserves to advance their nuclear energy ambitions, we expect the price of uranium and select related equities (near-term producers and producers) to increase significantly.

 
Key Fact: The WNA (World Nuclear Association) has reduced its production estimates over the next few years by between 10 and 18%. 
 On the demand side, the WNA said that installed nuclear generation capacity of 372 GWe provided about 15 percent of global electricity supply last year. The report forecasts a 12 percent increase in nuclear generation capacity to 415 GWe by 2014 and to 600 GWe by 2030.

· In January, China's CNNC International Ltd. acquired a 37% stake in the Azelik uranium mine in Niger. CNNC stated they are now moving their focus to additional acquisition opportunities in Kazakhstan.  Then, last week, their sister company, CNNC Overseas Uranium Holding Ltd, placed a bid to acquire 100% of the shares of Khan Resources Inc.  This offer trumped an existing offer from the Russian company, Atomredmetzoloto JSC, also interested in acquiring Khan's Dornod uranium deposit in Mongolia.
· Two weeks ago China Guangdong Nuclear Power Holding Co. announced their acquisition of a majority holding in Australian uranium explorer, Energy Metals Limited.

· Finally, a South Korean consortium lead by Kepco has just begun talks to acquire 15% in Extract Resources Ltd.'s Rossing South uranium mine in Nambia.

These are just a few examples of recent buyouts and mergers and we expect more to surface in the coming months.
It should be noted that every two years the World Nuclear Association (WNA) issues its "state-of-the-union-address" specifically on the uranium industry.  The 2009 meeting recently ended in London England, and several themes became very apparent:




1.            Uranium production is not keeping with previous forecasts
2.            Demand for uranium is increasing
3.            There is enough uranium to meet demand, but getting it into production will be difficult.

As a result of our extensive focus on the uranium market we have researched several near-term producers and current producers in order to find a company to park our investment dollars in. After several meetings, we found a company with nearly $30 million in its treasury, over 300 years of management experience and a Chairman who had his past two most notable companies bought out between $10 and $20 dollars per share. And one more important fact, this company has signed multi-year contracts for the sale of uranium with two world leading nuclear operators in anticipation of its production permits being approved. 

Tune in next week to learn about a company so well positioned in the uranium sector it will likely become our largest holding ever at Pinnacle Digest. PINNACLEDIGEST.COM
 
Please expand your research in preparation for our announcement next week. Below is an excellent article, recently posted on Forbes.com -
 
The Uranium Rush Is On    Reference: The World Nuclear Association represents 180 companies and a global industry. Please spend some time reviewing their public website as many of the facts in this report were taken from it.
 
 

среда, 24 декабря 2008 г.

Market Guru Creative Workshop

APPLE INC
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MVV Energie AG
With an annual turnover of Euro 2.3 billion and around 6,400 employees, the MVV Energie Group is Germany's largest publicly listed municipal utility network. Our value-driven approach to company management enables us to increase the earnings power of our shareholdings – and thus the overall value of the Group. Our business model is based on the horizontal networking and integration of multidivisional municipal utility companies. In our solid core business – the supply of electricity, district heating, gas and water – we have a high degree of technical expertise, a superb knowledge of the market and traditionally close links to our customers.

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Direxion Small Cap Bull 3x Shares
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The Bank of New York Mellon

About The Bank of New York Mellon
Established in 2007 from the merger of Mellon Financial Corporation and The Bank of New York Company, Inc., The Bank of New York Mellon is a leading asset management and securities services company, uniquely focused to help clients manage and move their financial assets and succeed in the rapidly changing global marketplace. Headquartered in New York, The Bank of New York Mellon has more than $23 trillion in assets under custody or administration and more than $1.1 trillion under management.
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Google's mission

Google Inc.
Google's mission is to organize the world's information and make it universally accessible and useful.
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Volume: High: 303.31 Avg Vol: 7,180,000 Low: 296.67 Mkt Cap: 93.81B
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