Fear of nuclear energy can be guessed. Disasters in Japan on March 11, has been withholding from the momentum accelerated nuclear renaissance. Over the past few years, nuclear energy has been promoted by its supporters as an alternative energy source that is clean, efficient, reliable and safe for dirty fossil fuels, and the world agrees.

A wave of new orders from BRIC countries as well as developed nations created a nuclear renaissance. Then over the past nine months, the price of uranium began to climb. Dormant since the 2008 recession, uranium rose from $42 per pound to a 52-week high of $72.65 in February.

The spot price of uranium fell over 25 percent in the days following the earthquake and subsequent tsunami in Japan. Value investors helped the troubled commodity regain ground by buying the plunge. But the question is still on everyone’s minds: What’s going to happen from this point forward?

On Monday, Germany announced it will shut down all of its nuclear reactors by 2022. The new policy is a complete reversal to the proposal to enhance Germany’s nuclear energy established by the government only seven months prior.

German Chancellor Angela Merkel stated to reporters on Monday: “Our energy system has to be fundamentally changed, and can be fundamentally changed …. We want the electricity of the future to be safer and, at the same time, reliable and economical.”

The decision by the German government to end its dependence on nuclear energy has once again riled the uranium market, but I believe the German decision is just creating short-term noise. Once this noise is gone, uranium stocks will once again reflect earnings – and while sales to reactors in Japan and Germany may slump, the world’s other 436 reactors will be as hungry as ever for uranium fuel.

Because as people are recovering from the Japan disaster – and possibly hating nuclear power more than ever – the supply and demand fundamentals of uranium have not changed in a significant way. The bottom line is that even in the wake of the Japanese catastrophe, uranium’s supply crunch lives on.

If we look out over the next eight to 10 years, which is the amount of time it takes a nuclear power plant to become fully operational, the market is still about 400 million pounds short of projected demand. The top 10 producers, which make up almost 90 percent of the uranium market, only produced 110 million pounds of uranium in 2010. In other words, uranium producers need to produce nearly four times the amount just to meet estimated new demand. The new supply will have to come from somewhere, or the price of the existing supply will need to increase to clear the market.

For uranium miners, the market is red hot. For investors, shares of the best uranium mining stocks could represent the best energy investment opportunity in decades.

The World Nuclear Association’s chart below sums up why now is the time to get into uranium-related investments. The world will be using more uranium for years to come, and many great investment opportunities appear in the midst of a supply crunch.

The supply crunch easily has the potential to become even more strained with 63 percent (note this is not the same as the top 10 producers mentioned above) of the current uranium production coming from only 10 mines worldwide. Additionally, the global supply of mined uranium is susceptible to supply shocks if one mine floods, or stops production for other reasons.

The most direct way to profit from the coming growth in nuclear energy and the shortage in uranium is to buy shares in the most productive uranium miners in the world. As I stated over a month ago, the tragedy in Japan and subsequent fear in the market have presented us with the opportunity to invest in several well-managed and fundamentally sound uranium companies. For well-informed investors with the patience to tolerate volatility for a couple of months, I think this could potentially be the single best opportunity to buy and hold uranium stocks.

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Since the jury issued a decree limits the damage of Japanese nuclear facility after the massive earthquake, investors are taking decisive action on Monday and sold down shares of uranium

During Australian trade, Pitchstone Exploration was sold down by 32% on the day. In early Canadian trade, Forum Uranium, was likewise down by 32%. South Africa-focused First Uranium was down 15% to CAD 0.82 a share. This stock listed five years ago, just ahead of the spike in spot uranium prices, and declined from highs in 2007 of CAD 13.00 a share.

The world’s biggest listed uranium producer, Canada’s Cameco, was falling 18% on Monday, taking its market value down to USD 12bn. France’s Areva, a diversified nuclear name which also mines, was down by a more modest 9% in Euro terms. Australia-listed Extract Resources (market value: USD 2.5bn) was among the least impacted, possibly on the recent buyer interest expressed in Kalahari Minerals, which owns a major stake in Extract.

Prior to the rout, uranium stocks had recovered strongly in recent months, following the increase in spot uranium prices from around USD 40.00 a pound in mid-2010 to over USD 70.00 recently. Quotes on uranium spot prices were not immediately available.

Selected uranium stocks

Producers	Stock	From	From	Value
	price	high*	low*	USD bn
Cameco	CAD 29.63	-33.1%	36.9%	11.999
ERA	AUD 8.25	-59.2%	2.6%	1.587
Paladin	AUD 3.95	-29.6%	17.2%	3.097
Uranium One	CAD 4.47	-36.3%	178.9%	4.394
Denison	CAD 2.42	-45.9%	110.4%	0.910
PriarGunsky	USD 255.00	-5.6%	54.5%	0.465
Averages/total		-41.9%	80.1%	22.453
Weighted averages		-36.4%	47.1%
Developers & other
First Uranium	CAD 0.82	-51.5%	15.5%	0.199
UEX	CAD 1.58	-39.9%	146.9%	0.330
Uranium Part.	CAD 6.60	-33.3%	29.9%	0.721
Summit Resources	AUD 3.03	-22.5%	67.8%	0.666
Mega Uranium	CAD 0.58	-55.5%	70.0%	0.149
Alliance Resources	AUD 0.32	-42.7%	12.5%	0.108
Bannerman	AUD 0.56	-38.1%	133.3%	0.132
Forsys	CAD 2.07	-57.3%	47.9%	0.170
Greenland Minerals	AUD 1.04	-26.2%	235.5%	0.330
Laramide	CAD 1.59	-44.6%	123.9%	0.110
Mantra Resources	AUD 7.50	-6.6%	111.3%	1.017
Energy Metals	AUD 0.58	-33.3%	34.9%	0.090
Deep Yellow	AUD 0.22	-44.2%	79.2%	0.244
Extract Resources	AUD 9.81	-9.2%	64.6%	2.482
Strateco Resources	CAD 0.72	-46.3%	84.6%	0.104
Strathmore Minerals	CAD 0.82	-51.2%	102.5%	0.075
UR-Energy	CAD 2.01	-40.0%	164.5%	0.212
Thor Mining	AUD 0.04	-32.8%	387.5%	0.018
Uranium Resources	USD 1.86	-53.2%	396.7%	0.172
Uranerz	CAD 2.93	-49.8%	215.1%	0.213
Hathor Exploration	CAD 2.16	-39.5%	60.0%	0.241
Marenica	AUD 0.07	-58.4%	12.6%	0.034
Marathon Resources	AUD 0.43	-45.9%	67.5%	0.042
Impact Minerals	AUD 0.12	-40.0%	31.9%	0.014
Kalahari Minerals	GBP 2.81	-9.0%	100.9%	1.113
Arafura Resources	AUD 0.95	-46.9%	150.0%	0.352
Uranium Energy	USD 3.88	-48.2%	83.7%	0.270
Dios Exploration	CAD 0.36	-18.2%	80.0%	0.014
Tournigan	CAD 0.19	-58.0%	122.4%	0.038
White Canyon	AUD 0.23	-11.8%	257.1%	0.052
Southern Uranium	Now at Investigator Resources
Uranium Equities	AUD 0.12	-40.0%	71.4%	0.025
Obtala	GBP 0.52	-2.6%	83.9%	0.196
Berkeley Resources	GBP 0.80	-33.6%	28.0%	0.134
Xemplar Energy	CAD 0.09	-65.4%	12.5%	0.011
JNR Resources	CAD 0.25	-52.9%	88.5%	0.025
Crosshair Exploration	CAD 1.33	-52.5%	216.7%	0.065
A-CAP Resources	AUD 0.47	-38.2%	67.9%	0.095
Fission Energy	CAD 0.89	-40.7%	128.2%	0.079
Curnamona Energy	AUD 0.18	-40.0%	28.6%	0.012
Thundelarra	AUD 0.45	-56.5%	7.1%	0.070
Khan Resources	CAD 0.43	-53.8%	145.7%	0.024
Vane Minerals	GBP 0.03	-33.3%	41.2%	0.016
Energy Fuels	CAD 0.73	-54.1%	461.5%	0.073
Azimut Exploration	CAD 1.45	-14.7%	163.6%	0.040
Desert Energy	AUD 0.11	-42.1%	29.4%	0.013
Pancontinental Uranium	CAD 0.25	-68.4%	257.1%	0.014
Pepinnini Minerals	AUD 0.19	-47.9%	40.7%	0.017
Nuinsco Resources	CAD 0.18	-37.9%	350.0%	0.047
Pitchstone Exploration	CAD 0.31	-50.0%	45.2%	0.012
Canalaska Uranium	CAD 1.01	-46.8%	26.3%	0.018
UraniumSA	AUD 0.39	-43.9%	176.2%	0.057
Bitterroot Resources	CAD 0.12	-47.8%	200.0%	0.010
Encounter Resources	AUD 0.89	-31.5%	334.1%	0.089
Calypso Uranium	CAD 0.30	-13.0%	185.7%	0.016
Energy & Minerals Australia	AUD 0.19	-35.6%	65.2%	0.074
Atomic Resources	AUD 0.45	-23.7%	350.0%	0.072
Titan Uranium	CAD 0.37	-58.0%	265.0%	0.049
Uranex	AUD 0.41	-54.2%	251.0%	0.070
Energia Minerals	AUD 0.20	-49.4%	122.2%	0.014
Pele Mountain	CAD 0.27	-61.6%	211.8%	0.036
Crossland Uranium	AUD 0.22	-29.5%	175.6%	0.025
Eromanga Uranium	AUD 0.03	-56.1%	93.3%	0.010
African Energy	AUD 0.69	-34.4%	970.3%	0.204
Toro Energy	AUD 0.10	-44.4%	56.3%	0.096
NWT Uranium	CAD 0.16	-38.0%	0.0%	0.021
Apollo Minerals	AUD 0.08	-56.8%	9.6%	0.013
Forum Uranium	CAD 0.20	-61.5%	185.7%	0.026
Wealth Minerals	CAD 0.85	-36.6%	240.0%	0.043
Alara Resources	AUD 0.30	-41.2%	275.0%	0.038
Uracan Resources	CAD 0.20	-50.0%	100.0%	0.027
Niger Uranium	GBP 0.07	-30.0%	95.8%	0.013
Purepoint Uranium	CAD 0.29	-61.5%	307.1%	0.023
Nortec Ventures	CAD 0.28	-27.6%	205.6%	0.035
Int’l Enexco	CAD 0.29	-32.6%	28.9%	0.007
U3O8 Corp.	CAD 0.77	-41.7%	285.0%	0.062
Silver Spruce	CAD 0.15	-59.7%	262.5%	0.016
Altona Energy	GBP 0.10	-48.8%	34.4%	0.068
Rum Jungle Uranium	AUD 0.50	-27.7%	1078.6%	0.073
Solex Resources	CAD 0.42	-44.7%	281.8%	0.032
Uravan Minerals	CAD 0.30	-30.2%	140.0%	0.013
Oklo Uranium	AUD 0.05	-60.0%	53.3%	0.007
Macusani Yellowcake	CAD 0.55	-55.3%	254.8%	0.046
Nimrodel	AUD 0.09	-15.0%	596.7%	0.014
Contl. Precious Minerals	CAD 0.46	-55.8%	24.3%	0.024
Blue Sky Uranium	CAD 0.18	-79.9%	9.4%	0.014
Aura Energy	AUD 0.34	-39.3%	189.1%	0.045
Empire Resources	AUD 0.09	-43.8%	143.2%	0.011
Marmota Energy	AUD 0.09	-25.8%	50.8%	0.014
Int’l Montoro	CAD 0.09	-52.8%	183.3%	0.005
Uran	AUD 0.03	-40.5%	92.3%	0.007
Alberta Star	CAD 0.56	-21.1%	67.2%	0.012
East Asia Minerals	CAD 5.75	-34.1%	19.8%	0.444
Black Range Minerals	AUD 0.05	-45.1%	127.3%	0.032
Fronteer	CAD 14.55	-0.7%	327.9%	2.256
Portal Resources	CAD 0.20	-27.3%	150.0%	0.008
Eso Uranium	CAD 0.09	-50.0%	100.0%	0.010
Bearclaw Capital	CAD 0.08	-25.0%	50.0%	0.002
Forte Energy	AUD 0.10	-44.1%	37.7%	0.064
Mineral Commodities	AUD 0.10	-20.0%	270.4%	0.015
Mindax	AUD 0.40	-20.0%	14.3%	0.059
North American Gem	CAD 0.09	-56.1%	5.9%	0.016
Developer averages/total		-39.5%	149.4%	15.139
Weighted averages		-29.3%	102.9%
Overall averages/total		-39.2%	144.4%	37.126
Overall weighted averages		-34.0%	65.6%
Diversifieds with uranium
Areva	EUR 31.81	-20.5%	4.8%	15.235
Rio Tinto	GBP 39.94	-15.3%	45.2%	132.356
BHP Billiton	GBP 22.96	-13.3%	36.8%	231.051
AngloGold Ashanti	USD 46.69	-11.7%	29.6%	17.798
Equinox	CAD 5.02	-27.7%	63.5%	4.522
* 12-month

Source: market data; table compiled by Barry Sergeant

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Uranium producer Denison Mines reported a sharply lower quarterly net loss on Thursday compared with a year earlier when its results were hit by an impairment charge.

Toronto-based Denison reported a third-quarter loss of Cdn$9.5 million, or 3 cents a share, compared with a year-ago loss of $91.3 million, or 27 cents a share.

Analysts, on average, had forecast a loss of 1 cent a share, according to Thomson Reuters.

Revenue rose 213 percent to Cdn$39.9 million, from $12.7 million a year earlier.

Denison said it sold 706,000 pounds of uranium in the quarter at an average price of US$44.22 per pound.

Uranium production for the quarter totaled 373,000 pounds, and the company said it remains on track to produce 1.6 million pounds in 2010.

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Energy & Minerals Australia (ASX: EMA) said today that the sandstone-hosted Ambassador deposit could be producing at an estimated operating cost of $US23 per pound of U₃O₈, net of by-products.

The scoping study viewed two possible production routes - resin in pulp (RIP) of the lignite deposits at Mulga Rocks concurrent with in-situ recovery (ISR) of adjacent sandstone-hosted deposits.

The nameplate production was given as 1,200 tonnes (2.6 million lbs) U308 per annum, being 600 tpa each from RIP and ISR production. Project capital was given as $A260 M ($US259 M) with a maximum negative cash flow of $A165 M ($US164 M).

The internal rate of return was given as 30%.

EMA's managing director Chris Davis said the project was expected to be a long term, high volume, low cost producer of uranium with the flexibility of two production routes.

The Mulga Rocks deposits were discovered about three decades ago by the Japanese utility PNC but the low uranium price and then negative Federal Government policies on uranium mining saw this and many other Australian uranium discoveries dropped or put on ice.

Mulga Rock has the Ambassador, Emperor and Shogun deposits which Davis said collectively comprise one of Australia's largest undeveloped uranium resources.

The project is about 240 kilometres north east of the regional city of Kalgoorlie-Boulder and, despite its remoteness, has access to all required infrastructure and inputs for development, and is in an area with no conflicting land uses.

The modelling used was based on a U₃O₈ price of $US65/lb in Year 1 (2014), increasing to $US75/lb by 2016, and then constant thereafter. The exchange rate was a constant $US/$0.80 which today is out of kilter with the Australian dollar going past parity today against the weakening Greenback.

Principal by-products are nickel, cobalt and rare earth elements that could contribute sales of $US465 M over the life of the Ambassador open pit.

EME said the mining extraction from the Ambassador deposit will involve two distinct operations -- conventional open pit mining of the lignite resources by truck and shovel methods, after in situ recovery of uranium from sandstone mineralisation areas under the open pits.

There would be two separate primary treatment plants and one combined product preparation facility.

The first section of the treatment facilities will be a solvent extraction (SX) plant attached to the acid ISR well fields, and used to extract uranium from sandstone hosted mineralisation.

The second front end treatment facility, utilising agitated-tank, atmospheric acid leach and RIP, has been designed to extract uranium, base metals and rare earth elements from lignite hosted mineralisation mined from the open pit operations.

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