| As reported by the Wall Street Journal,
| |
| | the uranium resources of entire
|
| Sunday night's revelations that China
| |
| | countries.
|
| National Nuclear Corp (CNNC) may
| |
| | The energy battle in Africa is good news
|
| strengthen its ties to UraMin could
| |
| | for the two front-runners in Namibia:
|
| represent a broader picture than an
| |
| | UraMin and Forsys Metals. We've called
|
| ordinary acquisition of a near-term
| |
| | this a horse race, over the past several
|
| uranium producer.
| |
| | months. Both endeavor to become the 'next
|
| There is an ongoing global war for energy
| |
| | miner' following Paladin Resources in
|
| security, which appears to be politically
| |
| | this country.
|
| inspired. China and Russia are the main
| |
| | Yet, both companies are vulnerable to
|
| opponents, especially in Africa, but have
| |
| | acquisition efforts by Russian or Chinese
|
| rivaled each other, over the past several
| |
| | companies. Or either could be acquired by
|
| years, in Central Asia. The goal for both
| |
| | one or more majors hoping to build up
|
| nations is not only energy security but
| |
| | their uranium reserves. In the case of
|
| political influence and alliance over
| |
| | Rio Tinto, acquiring one or both could
|
| their targeted territories.
| |
| | mean expanding uranium operations in this
|
| On May 12th, Russia, Kazakhstan and
| |
| | country.
|
| Turkmenistan signed a declaration to
| |
| | Acquisition Candidates
|
| upgrade and expand transport pipelines
| |
| | Just as the announcement by Energy Metals
|
| along the Caspian Sea coast directly to
| |
| | Corp, regarding a potential sale of the
|
| Russia. The project relies mainly upon
| |
| | company, fueled weekend speculation as to
|
| the vast Turkmen gas reserves. This is
| |
| | the 'next' takeover candidates, the same
|
| part of Russia's growing monopoly of
| |
| | could occur this week with African
|
| Central Asian gas. Although Europe was
| |
| | acquisition candidates.
|
| shocked by Vladimir Putin's new
| |
| | One might be misled into believing China
|
| arrangement, the Chinese were
| |
| | would focus on Niger, where the company
|
| flabbergasted.
| |
| | has built a foundation, and Russia's
|
| We've been following developments in
| |
| | focus would remain in Namibia. However,
|
| Central Asia, and had reported upon
| |
| | in a state visit to China this week,
|
| milestone events in both of our uranium
| |
| | Namibian Defense force chief exchanged
|
| publications, and again (with far greater
| |
| | views with Guo Boxiong, Central Military
|
| details) in our soon-to-be-released
| |
| | Commission vice chairman, on promoting
|
| Investing in China's Energy Crisis.
| |
| | relations between the two countries.
|
| After more than two decades in power,
| |
| | In February, Chinese President Hu Jintao
|
| Turkmen strongman Saparmurat Niyazov
| |
| | visited Namibia to sign an economic deal
|
| passed away this past December. In April
| |
| | with Namibia giving the country a grant
|
| 2006, Niyazov had signed a framework
| |
| | of US$4.3 million and an interest-free
|
| agreement on oil and gas cooperation. By
| |
| | loan of the same amount. Reportedly, some
|
| August, Niyazov had announced a pipeline,
| |
| | of the money would be used to boost group
|
| designed to pump gas to China, would be
| |
| | tourism from China to Namibia. This is
|
| opened in 2009. The deal died with the
| |
| | the same tactic China has utilized in
|
| dictator, it appears.
| |
| | courting relationships in South America
|
| A few weeks ago, a spokesman for China's
| |
| | to help develop natural resource deals.
|
| National Reform and Development Committee
| |
| | With US$1.2 trillion in foreign currency
|
| announced China was unlikely to reach its
| |
| | reserves, China is exercising its
|
| natural gas target of a 10-percent
| |
| | financial biceps. In March, the country
|
| portion of the country's energy portfolio
| |
| | formed the Huijin Fund as the state's
|
| by 2010. Increasingly, Russia has shut
| |
| | investment arm. Up to US$400 billion have
|
| China out of Central Asia in obtaining
| |
| | reportedly been placed in this fund for
|
| long-term, multiple energy sources.
| |
| | investment purposes. On Sunday night, the
|
| Aside from South America, where China has
| |
| | Huijin Fund invested US$3 billion to
|
| strengthened the country's ties with
| |
| | purchase a stake in about 9.9 percent of
|
| Venezuela and others, Africa is a prime
| |
| | the Blackstone private equity firm. Our
|
| hunting ground for China's future energy
| |
| | research suggests the fund is likely to
|
| security. China has established a strong
| |
| | strongly invest in natural resources.
|
| foothold in the Sudan for petroleum. But,
| |
| | On this basis, we can not rule out a
|
| Africa is rich in uranium deposits.
| |
| | simple carving of Africa. We don't
|
| According to a report published by the
| |
| | believe China will quietly step back and
|
| International Atomic Energy Agency in
| |
| | focus the country's uranium acquisition
|
| 2005, Africa has 18 percent of the
| |
| | efforts in Niger, permitting Russia to
|
| world's known recoverable uranium
| |
| | concentrate on Namibia and South African
|
| resources - about six percent less than
| |
| | uranium.
|
| Australia and one percent more than
| |
| | In Niger, we covered two 'early days'
|
| Kazakhstan. We began coverage on both
| |
| | prospective uranium juniors over a year
|
| Namibia and Niger, after Russia sent a
| |
| | ago. North Atlantic Resources acquired a
|
| delegation to Egypt to discuss the
| |
| | uranium permit in the 1900-square
|
| nuclear renaissance. At the time, our
| |
| | kilometer Abelajouad in this country.
|
| research pointed to Africa, particularly
| |
| | This past April, the company increased
|
| those countries, as ripe for future
| |
| | its holdings to nearly 3,000 square
|
| uranium production. Chinese prospectors
| |
| | kilometers. In late April, Northwestern
|
| raced to Niger within weeks after our
| |
| | Mineral Ventures announced uranium
|
| initial coverage.
| |
| | mineralization in assays from rock
|
| During 2006, Namibia became saturated
| |
| | samples after a first-pass reconnaissance
|
| with numerous exploration plays hoping to
| |
| | on its In Gall and Irhazer uranium
|
| capitalize on the country's uranium
| |
| | properties. Both would need to further
|
| resources and relaxed environment.
| |
| | explore their properties before
|
| Consequently, the Namibian Minister of
| |
| | attracting serious interest from the
|
| Mines and Energy closed the country's
| |
| | Chinese.
|
| exploration window. Since then, Niger has
| |
| | However, in Namibia both UraMin and
|
| become a new hunting ground. We expect
| |
| | Forsys Metals are actively progressing
|
| this country to become just as saturated
| |
| | toward mining uranium on their
|
| as Namibia has been.
| |
| | properties. Either could be the first,
|
| China is eager to capitalize upon the
| |
| | but we believe both should become winners
|
| continent's uranium resources before
| |
| | in the uranium bull market. Because China
|
| Russia outmaneuvers them as has been
| |
| | has carefully aligned with UraMin, or at
|
| accomplished in Central Asia.
| |
| | least shown an inkling to do so, we
|
| According to an email we received from
| |
| | suspect Russia might begin to look more
|
| TradeTech's Gene Clark, after presenting
| |
| | carefully at Forsys Metals. This is
|
| at the China Power & Alternative Energy
| |
| | purely speculation based upon our premise
|
| Summit on May 18th, he told us China's
| |
| | of 'uranium Politiques.' We do not have
|
| official target for nuclear power
| |
| | any 'inside track' on this matter.
|
| capacity was '40 GWe by 2020 and another
| |
| | Fortunately, we had the opportunity to
|
| 18 GWe in the following five-year plan.'
| |
| | chat with Forsys chief executive Duane
|
| This confirms China's aggressive plans to
| |
| | Parnham late last week. His company had
|
| acquire sufficient uranium to reach this
| |
| | announced the completion of the
|
| capacity, and would be foolish to rely on
| |
| | pre-feasibility study on the company's
|
| just Australia.
| |
| | Valencia uranium deposit in Namibia. We
|
| Typically, China has built its energy
| |
| | missed the company's conference call, but
|
| portfolio through numerous deals across
| |
| | were allowed the opportunity to discuss
|
| multiple regions. This past October, Yang
| |
| | his company's prospects and future plans
|
| Changli, vice president of China National
| |
| | during a telephone call.
|
| Nuclear, said it would seek uranium not
| |
| | The company's pre-feasibility study was
|
| only from Australia, but from Canada,
| |
| | prepared by Australia-based Snowden
|
| Kazakhstan, South Africa and Namibia. In
| |
| | Mining, which used the guidelines of
|
| an interview Yang gave during the 15th
| |
| | Australia's JORC code. Subsequently, the
|
| Pacific Basin Nuclear Conference, he
| |
| | Valencia uranium mineral reserve was
|
| said, "China won't rely on any single
| |
| | classified as Probable Reserves. These
|
| supplier of uranium because of energy
| |
| | were calculated at 24 million pounds
|
| security considerations.
| |
| | U3O8.
|
| Namibia is the First African Focus of
| |
| | We asked about production. "We are now
|
| Uranium Politiques
| |
| | modeling 2.4 million pounds per year,"
|
| On May 14th, Russia's second-largest bank
| |
| | Parnham told us. He expects to payback in
|
| Vneshtorgbank and Russia's state-run
| |
| | less than two years. With Forsys as with
|
| nuclear exporter Tekhsnabexport announced
| |
| | all near-term producers, some early
|
| they were considered a joint venture to
| |
| | conversations have begun about
|
| operate in Namibia through licenses they
| |
| | pre-selling the company's uranium
|
| directly hold and through investments in
| |
| | production after production has
|
| other companies which have obtained
| |
| | commenced.
|
| licenses in Namibia.
| |
| | His company's news release talked about
|
| In March Russian Prime Minister Mikhail
| |
| | six month of stripping during the initial
|
| Fradkov announced his country was
| |
| | part of the operation so we started
|
| prepared to building nuclear plants in
| |
| | there. "We'll start when we get a mining
|
| Namibia. Neighboring South Africa had
| |
| | license and then looking at production."
|
| previously warned Namibia to expect
| |
| | When will the company complete its
|
| reductions in energy supplies. Namibia is
| |
| | ongoing environmental assessment? "We are
|
| dependent upon South Africa for
| |
| | hoping to have an environmental decision
|
| electricity and has forecast an energy
| |
| | by year end," Parnham told us. "We are
|
| deficit of 300 megawatts within the next
| |
| | hoping to have enough data to apply for a
|
| three years.
| |
| | mining license in early 2008. If that's
|
| On May 10th, Russia and Kazakhstan signed
| |
| | successful, then obviously the decision
|
| an agreement to set up the International
| |
| | to go forward will be made at that time."
|
| Uranium Enrichment Center, anticipated to
| |
| | For the time being, the company plans to
|
| come onstream by 2013. As part of this
| |
| | expand its resource. "The pre-feasibility
|
| announcement, Sergei Kiriyenko, head of
| |
| | is just the first snapshot of the
|
| the Federal Nuclear Power Agency, said,
| |
| | situation," he said. "We are finding the
|
| "Any country can become a member of the
| |
| | pit optimization study is only looking at
|
| center by signing an intergovernmental
| |
| | a very small portion of the overall
|
| agreement granting it guaranteed access
| |
| | resource." Does that mean the resource is
|
| to uranium enrichment services." We
| |
| | actually larger, then? "It's a heck of a
|
| conclude Namibia may wish to participate
| |
| | lot bigger," he told us. "It's just a
|
| in this arrangement.
| |
| | function of how much data you have
|
| Enter CNNC on Sunday night. The Chinese
| |
| | available to punch into the model. Then,
|
| company's deputy general manager for
| |
| | how much does the model give you back?
|
| uranium procurement announced to
| |
| | The evaluation process is ongoing. You'll
|
| Bloomberg News that CNNC and UraMin will
| |
| | probably see a change in the pit design
|
| start 'more formal' talks this week.
| |
| | very shortly because we have the ability
|
| UraMin is a prime acquisition candidate
| |
| | to move more resource into the reserve
|
| for the Chinese because of its uranium
| |
| | category."
|
| prospects in both Namibia and Niger. The
| |
| | We talked about his company's horse race
|
| company also has holdings in South Africa
| |
| | with UraMin. How does it look? "Neck and
|
| and the Central African Republic.
| |
| | neck, toe to toe," Parnham said. "I think
|
| We are now facing a new era of uranium
| |
| | it shows there's opportunity in Namibia,
|
| politics or rather 'Uranium Politiques.'
| |
| | and that's good that there are a number
|
| And there is good reason for this to
| |
| | of us working for a common goal."
|
| escalate. Yesterday, the U.S. Energy
| |
| | Finally, we asked what has emerged as the
|
| Information Administration issued
| |
| | key question: Is Forsys a ripe plum for
|
| 'International Energy Outlook 2007.' The
| |
| | the picking. He offered both sides of the
|
| report announced, "World marketed energy
| |
| | coin. "Where the real opportunity lies is
|
| is expected to grow by 57 percent between
| |
| | putting a property into production," he
|
| 2004 and 2030."
| |
| | responded. "The operation isn't all that
|
| The most rapid growth in energy demand is
| |
| | difficult so it's not a deposit that our
|
| anticipated in non-OECD Asia. The
| |
| | expanding team couldn't put into
|
| majority of this energy demand growth
| |
| | production." And then Parnham left the
|
| would come from China and India. This was
| |
| | door open. "Anything can happen. It's an
|
| the reference case - the middle ground of
| |
| | open market, and we are a public company.
|
| growth.
| |
| | But, we are certainly geared toward
|
| Also on Monday, leading Russian nuclear
| |
| | putting this into production."
|
| expert Yevgeny Velikhov, head of the
| |
| | And from what we've seen among the
|
| Kurchatov Institute, told reporters at a
| |
| | recent, significant consolidations, those
|
| news conference that the recent surge in
| |
| | companies who have commenced production,
|
| uranium prices "may still grow by another
| |
| | and those closest to production, are the
|
| order of magnitude." He believes the
| |
| | prime acquisition candidates. Why should
|
| uranium price will continue to rise as
| |
| | companies developing projects in Africa
|
| global uranium demand soars while
| |
| | become the exception instead of the rule?
|
| supplies remain tight. "The global energy
| |
| | Especially when two super powers are both
|
| market is very turbulent," Velikhov said.
| |
| | eagerly trying to establish stronger
|
| "The uranium price can hit any mark at a
| |
| | uranium footholds in this continent.
|
| time of crisis." Ironically, both crisis
| |
| | COPYRIGHT© 2007 by StockInterview, Inc.
|
| and turbulence have come about because of
| |
| | ALL RIGHTS RESERVED.
|
| the Asian and Russian scramble to lock-up
| |
| |
|