Nuclear Power Investments Based on Uranium - dummies

Nuclear Power Investments Based on Uranium

Civilian and commercial nuclear power is an integral part of the global energy supply chain and is a valuable energy source for residential, commercial, and industrial consumers worldwide. One way you can profit from increased interest in nuclear power is to invest in uranium, the most widely used fuel in nuclear power plants.

There’s been a bull market in uranium for the last few years, and this shows no sign of slowing. Because uranium isn’t a widely tradable commodity, the best way to profit from this trend is to invest in companies that specialize in mining, processing, and distributing uranium for civilian nuclear purposes.

A few companies in this sector include:

  • Cameco Corp. (NYSE: CCJ): Cameco operates four uranium mines in the United States and Canada. It’s also involved in refining and converting the uranium into fuel sold to nuclear power plants to generate electricity.

  • UEX Corp. (Toronto: UEX): This Canada-based mining company specializes in the exploration and mining of uranium in the Athabasca basin. The Athabasca basin in Canada is an important region in global uranium mining that accounts for about 30 percent of total world production. UEX is currently still in exploration phases, but it could become a real money-maker if it comes across large deposits of uranium.

  • Strathmore Minerals Corp. (Toronto: STM): Strathmore — another Canadian company — specializes in the mining of uranium. The company operates in the Athabasca region in Canada and in the United States.

Nuclear power generates more than 20 percent of the electricity in the United States; in countries like France, nuclear power generates over 75 percent of electricity! Accounting for about 5 percent of total global energy consumption, nuclear power is expected to remain at stable levels until 2030.

But if the price of fossil fuels (oil, natural gas, and coal) rises dramatically enough to start affecting demand, nuclear may play an important role in picking up the slack.