uranium, page-16

This is a summary from Mining News yesterday:

First, although some countries around the world are planning (or hoping) to build more nuclear reactors, this is really little more than optimism and blind faith in more ways than one. Even the most optimistic scenarios of hoped-for reactor construction in centrally planned economies will not pick up this expected decline in "western" nuclear capacity.

Second the "spot price" is a poor reflection of the true price received by miners since most uranium is sold under long-term contracts – it is perhaps the worst indicator of a mineral commodity market precisely for this reason. What will the future hold? That is anyone's guess.

Third, history is repeating itself yet again – perhaps this is the "sixth" great uranium rush.The current boom has the hallmarks of all previous booms – lots of blind faith, optimism, hope and of course – what all wanna-be companies truly love – plenty of cash being thrown wantonly around faster than someone can type hot prospect (aka "nearology"). There is no sense of rationality in the current stupendous hype about uranium.

Fourth, all (well, most) wanna-be uranium producers say they legitimately support nuclear non-proliferation efforts. There is a sting in the tail here which all prospective, wanna-be and actual producers here just simply have to ignore: to truly solve recalcitrant nuclear proliferation problems would mean dumping so much uranium (and
plutonium) on to the market that it would be capable of supplying the uranium market "gap" for at least another two decades or even more. This would collapse the price overnight should those horrible nuclear weapons ever be dismantled. But we all know that the politicians – east and west perfectly alike – are addicted to the alleged power they bestow on their nation.

Fifth, nuclear power is no effective solution to climate change and real alternatives are available and ready.

Sixth, the politics of uranium is really all about "perception is king". But a nuclear power industry for Australia – forget it, the coal industry out-smarted prospective civilian nukes in the 1960s and is doing the same again now – but perception is king on needing to be seen to do something on climate change (desperately anything).

Hence the current uranium debate, such as it is, is clearly based on numerous optimistic, hopeful, blind faith assumptions – history is repeating itself, yet again.

AAR is not about some pie in the sky uranium potential it is about the fundamentals of cash flow from a profitable gold operation and the potential to become a mid tier company with its Koongie Park base metal project.