SUMMARY

Nuclear energy “hot talk” should also get a boost in August and September, after the North American release of James Lovelock’s Revenge of Gaia (Basic Books). The 86-year old scientist has led the charge among the world’s environmentalists to get the greens to go nuclear. The international media has sought out Dr. Lovelock’s opinions. Figure we’ll see the same boost in “pro nuclear” media appearances going into the autumn. As the author appears on numerous talk shows, the polls should swing more heavily into building more nuclear plants. That could add further pressure on utilities to quickly secure inventory.

Russia’s desire for a uranium/nuclear monopoly, hurricanes, tight supplies through the summer and the likelihood of yet another energy crisis before Labor Day could spell a significant boost in spot uranium pricing. It would not surprise us should spot uranium trade closer to $60/pound over the next 100 days. Any “shock event” could spike the spot uranium price above that level, and possibly make a run for $100/pound uranium.

Such a level would be unsustainable, of course, but it would be an eye-opener and attract renewed interest in the domestic uranium mining sector. The key domestic contenders for adding new mining capacity in the United States appear to be Strathmore Minerals (TSX: STM; Other OTC: STHJF), Uranium Resources (OTC BB: URRE), Energy Metals (TSX: EMC), UR-Energy (TSX: URE.TO), and Uranerz Energy (OTC BB: URNZ). There are others, but we have not followed their developments as closely.

Should the Russians absolutely confirm there will be no HEU-2 deal, U.S. utilities will be driven to closely investigate working relationships with domestic uranium development companies for reliable nuclear fuel supplies. Itochu has established a relationship with Uranium Resources (UOTC BB: URRE), and we expect more of these joint ventures to materialize. As for market capitalizations versus pounds-in-the-ground, during the last uranium bull market (in the 1970s), utility companies were buying uranium companies for about $5-6/pound of uranium. Some of our favorite companies, which host historically reliable and NI 43-101 compliant uranium resources over 100 million pounds, would be severely undervalued under a parallel scenario.

StockInterview’s Investing in the Great Uranium Bull Market: A Practical Investor’s Guide to Uranium Stocks debuts its e-Book edition this coming weekend. The number of investors now following developments in the uranium sector has grown exponentially over the past two years. The mad rush for data about uranium companies and industry developments has catapulted this website’s traffic into the top ten percent of all Internet websites. When the print edition arrives in bookstores and libraries, and is offered through book clubs and other allied groups, the demand for uranium and interest in the nuclear fuel cycle should make another leap forward.

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