YLLXF - Uranium Expert Says 'Serious Issues' Face Industry | Benzinga
Source: Streetwise Reports 07/12/2024
Expert Dustin Garrow talks to Streetwise Reports about the past and future of the element increasingly in demand as the world's energy industry transitions to low-carbon solutions.
After the Fukushima Daiichi nuclear disaster in Japan in 2011, uranium prices dropped to US$20 to US$40 per pound for years after hitting US$136 in 2007.
But now the situation has changed drastically, according to industry expert Dustin Garrow, as the world works toward zero carbon goals, electric vehicles (EVs) and data centers for artificial intelligence (AI) gobble energy, and Russian uranium imports are banned because of the Ukraine War. Compounding the issue is that after Fukushima, many uranium mines and projects were shelved.
In January, the spot price for uranium rose to US$106.25 and has hovered in the US$90s and US$80s since then, landing at and on Wednesday it was at US$85.50 on Tuesday.
"All of a sudden, kind of unanticipated by the industry, we had governments saying we want to move toward reducing or eliminating our carbon footprint by 2050 (or) 2060" Garrow told Streetwise Reports. "We need kind of a low-carbon, no-carbon baseload power source. And that meant nuclear."
Utilities and governments are canceling plans to mothball plants, giving them licensing extensions. Even the dormant infamous Three Mile Island power plant in southcentral Pennsylvania, the site of the worst nuclear accident in U.S. history in 1979, could be switched back on. A partial reactor meltdown at the plant caused nationwide panic and led to the mothballing of many plants nationwide.
But Constellation Energy Group (NASDAQ: CEG) has been conducting tests at one of the plant's reactors that was shut down in 2019, which could possibly lead to a restart that could take several years, The Washington Post reported.
"We've found the plant is in pretty good shape" Constellation Chief Executive Officer Joe Dominguez told the newspaper. "We think it is technically feasible to restart it."
When it comes to the uranium markets, Garrow said he has seen it all over his 50 years in the industry, from US$6 uranium to US$136 uranium and "all points between."
He has held numerous senior management and marketing positions with uranium production companies, including Rocky Mountain Energy, Everest Minerals, Energy Fuels Nuclear, and World Wide Minerals Ltd. He served as vice president, marketing and sales for ConverDyn, the sole provider of natural uranium conversion services in the United States. He was also the executive general manager-marketing for Paladin Energy Ltd. (OTC: PALAF), a Perth, Australia-based producer of natural uranium concentrates.
Garrow now serves as chief commercial officer of Yellow Cake Plc, which was created to give pure exposure to uranium, and head of marketing for Deep Yellow Ltd., a mid-cap Australian company developing two advanced uranium projects.
The Catalyst: The Coming Energy Demand Surge
The nation's largest utility companies are warning of a coming energy demand surge from EVs and AI could be unlike anything seen since the widespread adoption of heat pumps and air conditioners pushed demand sky-high in the 20th Century, according to a June 30 piece by Spencer Kimball for CNBC.
Rystad Energy predicted that data centers and EVs alone will add 290 terrawatt hours (TWh) of new demand by 2030.
"Overall, the combined expansion of traditional and AI data centers, along with chip foundries, will increase demand cumulatively by 177 TWh from 2023 to 2030, reaching a total of 307 TWh" noted Rystad, an independent research and energy intelligence company. "Despite data centers currently representing a relatively modest portion of total electricity demand in the U.S., this marks a more ...