Bobwins, Picked up some UMZ.T & URZ both in the mid 6's to take advantage of that situation and to get some Uranium in my evolving to commodity's portfolio. Thanks again to all the metal heads on this board. I just don't know why everyones not here.
Betting on Uranium
By Darin Diehl
Publisher's notebook at the Casey Uranium Summit.
LAS VEGAS - With uranium now trading at more than US$113 per pound, it's understandable some investors in the metal may have already decided to cash in their chips and reap their rewards - especially if they had followed Doug Casey's advice and bought in the late 1990s when the price was under US$10.
But if there's an overriding message to the 300 plus individual and institutional investors gathered at the Casey Research Uranium Stock Summit this week in Las Vegas, it's that opportunity still abounds in uranium. There's no need to get up from the table just yet.
In his opening remarks to the delegates at the summit, Casey wasted no words in describing how he sees the odds on reaping even more riches from investing in uranium. "I believe this is the commodity bull market of a lifetime," he said. "Why should uranium stop now at US$113? There's no reason at all."
Casey believes the investing public, which has heretofore been mostly interested in the stock market and mutual fund market, will eventually catch on to the commodity trend and pile in. "Many, many people will be involved. These stocks will be the next bubble, like internet stocks were." He acknowledged to the audience that some of the uranium stocks may appear to be expensive relative to the absolute bottom of a few years ago. "But I think they're going to go much, much higher before this is over."
Casey says the gap between the increasing demand for uranium and the scarcity of ready supply is the main driver of the bull market in uranium and junior uranium company stocks. While exploration and development are really beginning to ramp up, he says any supply glut is still at least five years away. "You've got plenty of time. There's still plenty of money to be made."
That message was echoed by the first presenter of the day, Dr. Michael Gunning - president of Triex Minerals (TSX: V.TXM). A geologist by training, Dr. Gunning provided the investors attending with a lesson in the fundamentals of the current state of uranium exploration. Dr. Gunning gave a short history of the four phases of the uranium market. From 1945 to 1957, production was primarily driven by military needs. The first boom in civil demand came during the period from 1967 to 1985. Then from 1985 until 2003, there was a period that Dr. Gunning called a "secondary supply overhang." Basically, utilities companies could meet their demand requirements from existing stockpiles. "The utilities at this time were focused on cheap uranium from inventory, and were ignoring long term supply," Gunning said. "Now they realize the problem."
The current era of renewed production and exploration was sparked in part by the flooding in 2003 of the McArthur River mine in the Athabasca Basin. This site is the largest mine in the world in terms of annual production. Its flooding, which slowed production for a time, was a catalyst for the industry to realize more global production was needed.
Dr. Gunning says one fact about uranium exploration that investors need to understand is that uranium is not rare. "There's a lot of it out there. But the key is where can you trap it? Where is there enough of a concentration to mine?" For junior mining and exploration companies to be successful, Dr Gunning argues, they will have to have "good geology, good location, and good mining." So the due diligence questions for investors then become: How good is your company's geological surveying of the district in which your properties exist? What's the quality of the actual site location, in terms of the ease of extraction of any proved deposits? And finally; what technologies will be employed to put the site into production?
Both Dr. Gunning and Doug Casey made the point that not all sites and not all junior uranium companies will be of equal quality. The number of companies involved has grown from less than 10 to more than 400 - so do your homework and ask lots of questions.
AI
