US uranium miners look set to prosper in 2021 if President Biden can successfully legislate his plan for 100% carbon free electricity by 2035. That is because the US currently gets about 55% of its carbon-free electricity from nuclear power which relies on uranium as its feed source. 100% carbon free US electricity will mean a massive boost towards solar, wind, and nuclear energy. Another boost for US uranium producers will be the US$150M pa proposed for the next 10 years to build a US uranium reserve. Combine all this with a global deficit of uranium (constrained supply and growing demand) and we get the perfect tailwind for US uranium miners in 2021.
Clearly, the market is already seeing this with leading US uranium miners such as Energy Fuels Inc. (NYSE American: UUUU | TSX: EFR) (+471%) and Ur‐Energy Inc. (NYSE American: URG | TSX: URE) (+238%) seeing massive stock price gains the past year. The good news is that a lesser known uranium miner is still trading on a very low market cap and is, in my opinion, yet to be fully appreciated by the market.
That company is Western Uranium & Vanadium Corp. (CSE: WUC | OTCQX: WSTRF). The stock is up 162% in the past year but from a very low base, still with a market cap of a mere C$44M. The reason for the low market cap is mostly because the Company is not currently producing.
Now here comes the good news! Western Uranium and Vanadium has great US uranium and vanadium assets and is “production-ready“. The Company has been waiting for stronger uranium and vanadium prices before re-starting production. Given the uranium deficit and rising uranium prices, we may not have to wait too much longer.
Uranium is now in a global structural deficit which usually leads to stronger uranium prices
Source: Western Uranium & Vanadium company presentation
In a recent market update announced on Jan. 13, 2021, Western Uranium & Vanadium stated:
“Western is excited about our competitive position, market opportunities, and the prospects for nuclear energy and uranium mining. Western’s Sunday Mine Complex project during 2019/2020 established the mines are in “ready-to-produce” status. These permitted and developed conventional mines can be restarted with minimal capital expenditure. The first uranium/vanadium ore production was stockpiled underground and remains ready for delivery when COVID-19 and market conditions permit.”
Another aspect of the Biden green infrastructure plan which is soon to be the focus of US attention is the need for the USA to move towards smart nuclear. This means advanced nuclear power reactors, small modular reactors, microreactors and so on. This has the potential to lead to a renaissance in the nuclear sector in the USA as a way of achieving base load power and reducing carbon emissions.
Western stated:
“Globally there are about 50 large-scale nuclear reactors under construction with 15 projected to be put into service in 2021. Most are being built using Russian or Chinese technology. Many are in countries with an urgent need for de-carbonization to improve air quality. China currently has an operating fleet of about 50 nuclear reactors and is targeting the construction of 6 to 8 new large scale reactors each year.”
More about Western Uranium & Vanadium
As their name suggests Western Uranium & Vanadium has both uranium and vanadium. Uranium is the key to large scale base load energy production and vanadium may hold the key to large scale energy storage (using grid scale Vanadium Redox Flow Batteries (VRFBs)).
Western Uranium & Vanadium’s flagship asset is their Sunday Mine Complex in Colorado USA which contains good grade uranium and vanadium as a valuable by-product. The Company also owns several other uranium & vanadium projects in both Colorado and Utah, USA as well as the Bullen Oil & Gas Property royalty, in Colorado, USA.
Western Uranium & Vanadium has good grade uranium and valuable vanadium at their 100% owned Sunday Mine Complex in Colorado USA
Source: Western Uranium & Vanadium company presentation
Closing remarks
The U.S. List of 35 critical minerals includes both uranium and vanadium as they are both seen as critical to support key industries in the USA in the decades ahead. Western Uranium and Vanadium has both, in the USA, and ready to produce!
Western Uranium & Vanadium Corp. on a market cap of only C$44M is a hidden gem waiting to be found. Don’t miss this one.
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