Daniel Major: A Move in Long Term Uranium Spot Price will Drive a Buying Frenzy
Daniel discusses the long-term potential of uranium and why the industry needs higher prices to fill the supply gap. The short-term issues are that 75% of the industry remains near or below the cost of production. Companies currently can’t afford to replace their resource. Cameco has taken the lead in closing down one of the best mines saying that it’s cheaper to purchase uranium from the market. Cameco’s announcement was a major event for the uranium industry.
The enrichment sector is also beginning to have issues with contracts coming off. Capacity cutbacks will affect underfeeding. It will be interesting to see how these cuts affect the long-term price. If you look at GoviEx, they have been trading at a substantial discount for a company with excellent resources and a fully permitted project. Currently, everyone is risk-adverse. As the market unwinds and the uranium price improves investors should become more interested.
The markets are not rational and can’t continue to trade at these discounts. As interest in quality companies returns, investors should see where the value is in this market. He feels they are one of the few that can turn a project into cash-flow.
Daniel discusses the various projects and properties that they have acquired and how they fit together to provide a very impressive prospectus. He feels they are in a much better position than most of their competition as they have been able to consolidate research, finances, and projects into one centralized plan.
Much of these plans are contingent on the uranium price. They plan to continue work on financing and deciding where their next exploration focus will be.
Talking Points From This Week’s Episode
• Uranium price remains too low, and the market remains risk-adverse.
• The enrichment and underfeeding sectors are looking at production cutbacks.
• Cameco’s mine closure may have a significant effect on the market.
• GoviEx is in an excellent position to profit from the coming bull market.
Daniel Major is Chief Executive Officer of GoviEx and is a mining engineer from the Camborne School of Mines in the UK. His career spans over 25 years in the mining industry where he has established a solid track record initially with Rio Tinto at the Rossing Uranium Mine in Namibia and later as a mining analyst with HSBC Plc followed by JP Morgan Chase & Co. in London. More recently Mr. Major was Chief Executive and later Non-Executive Chairman of Basic Element Mining and Resource Division in Russia, and held leadership positions in several Canadian listed mining companies with exploration and producing assets in Canada, Russia, and South America.