Berkeley Energia (BKY) well placed to capitalise on the improved sentiment in the uranium market
Sentiment in the uranium market, which was picking up towards the end of last year, seems set to continue to improve. The UxC Weekly spot price is currently up 36% since December, when it was languishing at twelve year lows of $18.00.
As we begin to see light at the end of the tunnel, Berkeley Energia’s (BKY) 100% owned uranium project in western Spain is the only mine in the world proceeding with construction, starting in Q1 2017 following the order of the main equipment for the crushing circuit late last year.
The current market remains a difficult yet crucial environment in which to advance towards production. Over the past year we have seen a gradual supply side destruction, combined with an unprecedented increase in global demand.
2016 saw major production cuts at Rabbit Lake, McArthur River, Smith Ranch-Highland, Crow Butte, and Langer Heinrich.
Berkeley Energia’s operating costs of just US$15/lb will enable the Company to generate strong returns for shareholders even in the current price market.
Nuclear power generation is expected to grow steadily in the years to come, China’s rapid nuclear expansion programme is one of the main reasons for this. It’s spending $570bn targeting 10% generation from nuclear power.
The BP Energy Outlook Report, published this week, reported that “China’s rapid nuclear expansion programme accounts for nearly three-quarters of the global increase in nuclear generation. This is roughly equivalent to China introducing a new reactor every three months for the next 2 years.”
Additionally, the Trump presidency could drive demand higher still, with last month’s US senate confirmation of Rick Perry as Energy Secretary cementing the administration’s pro-nuclear mindset. Perry has previously stated that, like Trump, he is in favour of nuclear energy, articulating his belief that the federal government must remove barriers to investment in new nuclear plants.
The Trump administration’s enthusiasm for nuclear has been well received across the sector, Cameco CEO Tim Gitzel said that "we've heard some encouraging words from the Trump team on nuclear power. We're optimistic that will help our nuclear industry."
To hear more information about how and why Berkeley Energia is going ahead with construction at the bottom of the uranium price cycle, Paul Atherley, Managing Director, will be presenting at the 121 Conference on Tuesday 7th February at 2.30pm.
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