Categories: Energy / General Market Commentary
Topics: General Energy / General Market Commentary

U.S. Gov’t Expedites the Uranium Cycle

The U.S. government has taken another step to boost the American uranium industry while reducing reliance on imports from Russia. 
In a tentative deal with Russia’s state atomic agency, the U.S.

Department of Commerce is seeking to reduce Russia’s share of U.S. low enriched uranium supply from 20% today to an average of 17% by 2020. 

The agreement, which is an extension of a deal begun in 1992, would also limit natural uranium and specific conversion components to “no higher than 5% starting in 2026.”

Uranium Energy Corp. (NYSE: UEC) says this amounts to a reduction in Russian natural uranium imports of up to 75% from prior limits.  

For context, the U.S. consumes about 47 million pounds U3O8 annually, the initialed agreement reduces the annual natural uranium component limit from ~9.4 million pounds of Russian U3O8 to less than 2.4 million pounds.

UEC, with former Energy Secretary Spencer Abraham as its Chairman, has keen insight on what this means for the industry and has been positioning to benefit from it. Mr. Abraham said “this milestone will set the stage for growth and opportunity in the domestic uranium mining industry.”

Given that the U.S. currently produces no uranium, this is literally a ground floor opportunity. 

UEC already has licensed projects and a processing plant ready to go. And the smart money knows it. 

Shares of Uranium Energy have already broken out to near 52-week highs on the news, and could head much higher in a hurry if they convincingly break through that US$1.25 mark. 

This was a US$7.00 stock in the last uranium bull cycle. A new cycle is creeping ever closer, and is now being expedited by the government.

You can read our report about UEC’s production profile here.

Click here for a video on how we’re finding these top junior mining investments.

Yours in profits,

Mike Fagan
Editor, Resource Stock Digest

Mike Fagan has mining in his blood. As a teenager he staked countless gold and silver properties in Nevada alongside his dad Brian Fagan, who created the Prospect Generator model that’s still widely used today in the resource space. One of those staking projects was put into production by a major Canadian mining company — a truly rare and profitable experience. That background uniquely qualifies him as a mining stock speculator. One of the most well-known names in the business, Mike is now putting that experience to use for the benefit of Resource Stock Digest and Hard Asset Digest readers. 

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