Uranium

Uranium is a heavy metal that has been used as an abundant source of concentrated energy for over 60 years.

Nuclear provides safe and reliable, emissions free baseload power and is a key pillar in the clean energy transition. Nuclear power is important to achieve net zero goals.

About 10% of the world’s electricity is generated from uranium in nuclear reactors. This amounts to over 2500 TWh each year, as much as from all sources of electricity worldwide in 1960.

In 2023, Uranium was the world’s best performing commodity, with the spot uranium price increasing by over 70% during the course of the year.

The increase was primarily driven by two major themes – the key role that nuclear energy will play in the world’s quest to reduce emissions and decarbonise, and the widening gap between uranium supply and demand. 2023 was the sixth consecutive year of supply deficit in the uranium industry and it can no longer rely on inventory drawdowns for its nuclear fuel requirements.

Demand

A landmark agreement was reached at COP28 in December 2023, which saw 22 world leaders sign a declaration to triple nuclear energy by 2050 and was described by Forbes as “Nuclear Power’s Pivotal Moment”. Further, the House of Representatives in the USA passed “The Prohibiting Russian Uranium Imports Act” in December 2023 which will further increase the demand for domestically produced uranium. The passing of this Bill in conjunction with the USA’s Inflation Reduction Act and COP 28’s commitment creates a favourable fiscal environment in which to be bringing a project like the AUP online.

Supply

In the USA there is an ever-growing need for a sustainable domestic supply source. The United States boasts the largest nuclear power fleet worldwide and nuclear energy is a critical component of the country’s energy mix, generating 50% of the USA’s low carbon/emissions-free electricity, highlighting its significance in combating climate change. Nuclear energy enjoys bipartisan support and has reached its highest level of public backing to date, underlining the widespread recognition of its benefits. Given these factors, there is an urgent need to revitalise the US nuclear supply chain to ensure the nation’s energy security and environmental objectives are met. The Company expects this heightened focus on domestic uranium production to not only expedite the development of USA uranium projects like AUP, but also likely garner Department of Energy support for financing new mines, thereby enhancing domestic uranium production for nuclear fuel.