The Energy Report
Source: The Energy Report 05/02/2017
Department of Energy Secretary Rick Perry issued a determination that reduces the amount of uranium the department can transfer in 2017 and 2018; the reduction should give a boost to uranium producers.
Every two years the Secretary of Energy is required to determine the amount of uranium allowed to be transferred to support the clean-up work at the Portsmouth Gaseous Diffusion Plant in Ohio. On April 26, Secretary of Energy Rick Perry released a determination to permit transfers of 1,200 metric tons of uranium (1,200 MTU) per year, down from 1,600 MTU.
According to the Department of Energy, the agency “has been transferring excess uranium in exchange for services at the Portsmouth site for several years, and current law requires that a new Secretarial Determination be made every two years to assess whether future planned transfers would have an adverse material impact on the domestic uranium industries. The last Secretarial Determination for uranium transfers in support of this clean-up work was issued on May 1, 2015.”
Rob Chang, an analyst with Cantor Fitzgerald, wrote on May 1 that this development is “positive to the uranium sector as it reduces the amount of uranium that was being dispersed into the market by the U.S. Department of Energy.”
Chang noted that the stipulated maximums are “800 MTU of UF6 for the remainder of 2017 and 1,200 MTU for 2018. . .this translates into about 2M lbs and 3.1 M lbs of U3O8 equivalent for those years.” Chang also stated that “the maximum amount was always transferred in the past and many industry participants believed that these transfers had an adverse impact on the market as it increased spot supply.”
Free Reports:
Kazakhstan’s uranium producer Kazatomprom announced a 10% cut in annual supply earlier this year; that cut, according to Chang, “sparked a spot uranium price rally from US$20.25/lb to a peak of US$26.00/lb, or by 28%. Uranium equities across the board experienced large gains during the same period.”
Stephen P. Antony, president and CEO of Energy Fuels Inc. (EFR:TSX; UUUU:NYSE.MKT), hailed the Department of Defense’s action and noted that “as uranium prices rise, Energy Fuels has low-cost projects that are ready to increase production, including our Canyon Mine, Nichols Ranch ISR Project and Alta Mesa ISR Project.”
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Disclosure:
1) Patrice Fusillo compiled this article for Streetwise Reports LLC and provides services to Streetwise Reports as an employee.
2) Energy Fuels Inc. is a billboard sponsor of Streetwise Reports. Streetwise Reports does not accept stock in exchange for its services. Click here for important disclosures about sponsor fees. The information provided above is for informational purposes only and is not a recommendation to buy or sell any security.
3) Comments and opinions expressed are those of the specific experts and not of Streetwise Reports or its officers.
4) This article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional and any action a reader takes as a result of information presented here is his or her own responsibility. By opening this page, each reader accepts and agrees to Streetwise Reports’ terms of use and full legal disclaimer. This article is not a solicitation for investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company mentioned on Streetwise Reports.
5) From time to time, Streetwise Reports LLC and its directors, officers, employees or members of their families, as well as persons interviewed for articles and interviews on the site, may have a long or short position in securities mentioned. Directors, officers, employees or members of their immediate families are prohibited from making purchases and/or sales of those securities in the open market or otherwise from the time of the interview or the decision to write an article, until one week after the publication of the interview or article.
According to the Department of Energy, the agency has been transferring excess uranium in exchange for services at the Portsmouth site for several years, and current law requires that a new Secretarial Determination be made every two years to assess whether future planned transfers would have an adverse material impact on the domestic uranium industries. The last Secretarial Determination for uranium transfers in support of this clean-up work was issued on May 1, 2015.
Rob Chang, an analyst with Cantor Fitzgerald, wrote on May 1 that this development is positive to the uranium sector as it reduces the amount of uranium that was being dispersed into the market by the U.S. Department of Energy.
Chang noted that the stipulated maximums are 800 MTU of UF6 for the remainder of 2017 and 1,200 MTU for 2018. . .this translates into about 2M lbs and 3.1 M lbs of U3O8 equivalent for those years. Chang also stated that the maximum amount was always transferred in the past and many industry participants believed that these transfers had an adverse impact on the market as it increased spot supply.
Kazakhstan's uranium producer Kazatomprom announced a 10% cut in annual supply earlier this year; that cut, according to Chang, sparked a spot uranium price rally from US$20.25/lb to a peak of US$26.00/lb, or by 28%. Uranium equities across the board experienced large gains during the same period.
Stephen P. Antony, president and CEO of Energy Fuels Inc. (EFR:TSX; UUUU:NYSE.MKT), hailed the Department of Defense's action and noted that as uranium prices rise, Energy Fuels has low-cost projects that are ready to increase production, including our Canyon Mine, Nichols Ranch ISR Project and Alta Mesa ISR Project.
Read what other experts are saying about:
Energy Fuels Inc.
Want to read more Energy Report articles like this? Sign up for our free e-newsletter, and you'll learn when new articles have been published. To see a list of recent articles with industry analysts and commentators, visit our Streetwise Articles page.
Disclosure: 1) Patrice Fusillo compiled this article for Streetwise Reports LLC and provides services to Streetwise Reports as an employee. 2) Energy Fuels Inc. is a billboard sponsor of Streetwise Reports. Streetwise Reports does not accept stock in exchange for its services. Click here for important disclosures about sponsor fees. The information provided above is for informational purposes only and is not a recommendation to buy or sell any security. 3) Comments and opinions expressed are those of the specific experts and not of Streetwise Reports or its officers. 4) This article does not constitute investment advice. Each reader is encouraged to consult with his or her individual financial professional and any action a reader takes as a result of information presented here is his or her own responsibility. By opening this page, each reader accepts and agrees to Streetwise Reports' terms of use and full legal disclaimer. This article is not a solicitation for investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company mentioned on Streetwise Reports. 5) From time to time, Streetwise Reports LLC and its directors, officers, employees or members of their families, as well as persons interviewed for articles and interviews on the site, may have a long or short position in securities mentioned. Directors, officers, employees or members of their immediate families are prohibited from making purchases and/or sales of those securities in the open market or otherwise from the time of the interview or the decision to write an article, until one week after the publication of the interview or article. "}