be optimistic

All,

There are many reasons to be optimistic about this industry.

Did you know there are more nuclear reactors under construction and planned now than there were prior to Fukushima?

That tells me utilities are going to pick up their buying. And the smart ones are already securing supply. EDF just agreed to pay out $200 million in cash a full seven years in advance for delivery of 13 million pounds and they've contracted 78 million pounds from another company. The United Arab Emirates covered a full seven years of uranium supply for its first four reactors by buying $3 billion worth of supply contracts.

Saudi Arabia can certainly afford to follow this example and buy enough uranium to supply its 16 planned reactors. Massively power-poor India is talking with uranium-rich Canada and Australia about uranium supply agreements and India is going to build at least 30 reactors.

Also, the demand side is looking price positive when you factor in the restart of Japanese reactors, the Chinese resuming construction, developments in South Korea and the emerging markets of India and Russia.

On the supply side, the HEU (Highly Enriched Uranium) agreement between the US and Russia ends at the end of next year. Couple that with the estimated more than 22 million pounds of U3O8 production that has been deferred on poor economics.

Paladin Energy estimates a 25 percent drop in mine supply due to market conditions by 2020.

There's no way around it. Fukushima was very unfortunate, but the fact is it has presented resource investors with great opportunity.

Zack