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Sunday
Oct212007

Uranium-Stocks.net: portfolio Update 21 October 2007

To many investors it comes as some relief that the spot price for uranium registered a slight upturn recently as we can see on this chart courtesy of u3o8.com.
Uranium Chart 20oct07
Every little bit helps and it is without doubt pleasing to us to see the recent down trend halted. But, the focus must remain on the long-term price, which is holding at $95/lb. The long-term uranium price has not fluctuated as widely as the spot price and has remained fairly steady. In a market this thin the long term indicator reflects the true situation more accurately than the spot price which is subject to a myriad of influences such as floods, hoarding, government intervention, private investor speculation, fund buying and selling, political instability, geographical hardship and challenges, liquidity calamities, et al. Spot prices in any commodity are subject to knee jerk reactions as our emotions run riot.


Since the last update many of the stocks have started to recover. Its not a time to celebrate but if you have the cash and the nerve it is a time to gently accumulate some more of your favourite uranium stocks.

Below we list the uranium stocks that we have an interest in or are watching with the view to making a future investment. We are also looking for the occasional trading opportunity as we are small enough and should be nimble enough to move in and out of a particular stock quickly as we did in our portfolio of silver stocks recently. This is difficult for the big players who own big positions in their favourite uranium stocks as the thin liquidity of some stocks does not allow them to sell a large position at the push of a button. But that is no excuse for us, so going forward we will suggest from time to time one or two short term trading moves as we did recently with Khan Resources.

Cameco Corporation – Watch
Cameco was trading at $55.09 on TSE recently, but has been down as far as $39.25 and closed at $43.66 on Friday. CCO has a fair number of fans but we just can’t see it outperforming this sector.

RPT Uranium Corp – Watch.
We bought RPT on the 19th February 2007 for $0.42 and sold it for $0.62 on the 13th June 2007 for a profit of 47.6% in 4 months. We still like this stock and so bought it back at around 50 cents; RPT now languishes at $0.26, which is disappointing. This is a small company with a market capitalisation of $24 million. Success rests on the Sibley project where the Company has commenced a 2500-metre diamond drilling program on the Frazer Creek uranium zone on its Malborne Lake claim block near the south eastern margin of the Sibley basin north of Thunder Bay, Ontario. Uranium mineralization is exposed over a 35 metre by 25 metre area, and the first eight grab samples to be analysed averaged 0.242% U3O8.

Uranium Participation Limited – Buy
U was trading at C$10.99 last month and closed on Friday at $12.49, which is a terrific improvement over one month. We bought at $11.97 on 21 November 2006 so U is now showing a small paper profit of 4.3% We will continue to hold, as it offers direct exposure to uranium without the risks inherent in mining.

Strateco Resources Inc – Buy
We made a small investment in RSC at $2.30 so were pleased to see it close at $2.52 last month, however it has fallen back to $2.41, but we are still in positive territory.

Fronteer Developments Group
Fronteer has been transferred to our gold investment account as we now consider it to be more of a gold play than a uranium play even though it still owns the lions share of Aurora Energy Resources, which we track here.

Crosshair Exploration and Mining Corporation – Neutral.
Having taken a small profit we continue to watch CXX. The stock was trading at $1.73 last month and closed on Friday at $2.09. Listing on the AMEX as CXZ provides this stock with exposure to the American stock market where there are not too uranium stocks to choose from.

Laramide Resources Limited – Buy
This stock was $7.36 last month and closed at $8.63 on Friday. We bought at $5.78 on the 28 July 2006 so we are pleased to see this recovery. When we were sitting on a paper profit of around 80% we sold half in order to buy other uranium stocks, as we needed a bigger spread of stocks. Our current holding now shows a profit of 44.63%

Energy Metals Corporation – Now part of Uranium One

Eagle Plains Resources – Buy
This stock is mainly featured on our silver website, but it does have some uranium interests. EPL was trading at $0.76 in the last update and is currently trading at $0.82, for a nice move since we bought it at $0.53, giving us a profit of 54.7%. As we mentioned previously the news flow continues at a reasonable pace and appears to have been well received by the market. Hold on tight to this industry’s ’Project generator’

Mega Uranium Limited – Buy
We bought MEGA at around $4.0 on 27 July 2006. MGA is now trading at $4.35 so we are once again back in the black. MGA has a very good cash position and is well managed so we expect to see it trading a lot higher in the near future.

Rodinia Minerals Inc. – Watch
RM was $0.80 when we first wrote about it on 15 August 2006 and is currently trading at $0.62 so a fairly volatile stock. The volume is still tiny although it is improving with turnover hitting 151,000 on Friday. It is a small company with a market capitalisation of $14.05 million.

Santoy Resources Limited – Watch
However having decided to sell three of its projects to Mega for 400,000 common shares in Mega we decided to sell. We sold on 23 April 2007 at $1.39 for a profit of 70% in 4 months. Santoy now trades at $0.55. This stock is not for us at the moment but they do have a number of interesting joint ventures underway so keep an eye on them.

Khan Resources Ltd - Buy
We bought Khan on the 5th March at $3.63 and it dropped to $1.33 due to licensing issues with the Mongolian regulators. So, in anticipation of Khans management team finding a resolution to this problem we decided to buy again. (See Khan Resources: A speculative buy) the stock rallied and we took a profit of 15% in a matter of days before the stock fell back. Khan closed on Friday at $2.71 up from $2.38 last month so this stock is making progress. However we do need confirmation that the outstanding license issues in Mongolia have been resolved. Also note that LAM took advantage of this turbulence and bought 5.6 million shares in Khan, a good investment in our opinion.

Aurora Energy Resources - Buy
We bought Aurora on the 5th March 2007 at $14.17 and it has traded as low as $10.40 since then, however it is now trading at $15.27 much to our relief, for a small gain of 7.76%.

Strathmore Mineral Corporation - Buy
We bought STM on the 14th April 2007 at $4.96 and it is currently trading at $2.55, down overall about 48%. STM has not joined in this recovery, which is disappointing however we will hold for now.

Ur-Energy - Buy
We bought Ur-Energy on the 23rd April 2007 at $4.75 and we also gave a second buy signal on the 24th August 2007 when we acquired more stock at $3.03. URE closed on Friday at $3.24 so hopefully the recovery has commenced for this stock.

UraMin Incorporated – gone to that big AREVA in the sky!
We bought UraMin on the 15th May 2007 at $6.72 and sold it for $8.36 on the 22nd June 2007 for a gain of 24.4% in 6 weeks. (Niger Uranium could be a possible replacement but the political situation in Niger is not the best.

Uranium:
We are sticking with our target prediction of $200.00 per pound for uranium although it may now take longer then previously thought. Don’t be put off if we haven’t mentioned your favourite stock we do get it wrong now and again as evidenced by reading our updates. We have survived the carnage and things are starting to look at little brighter.

If you are a new comer to this site please do get involved and add your comments to any of our articles whether you agree with us or not as this will add balance to what we say and be of benefit to everyone. No, you can’t use naughty words.

Please accept our apologies if you were unfortunate enough to visit the site when unwanted Spam is present we have now installed more Spam protection so it should diminish day by day.
Please feel free if you haven’t joined to sign up to the forum and get involved with some of the debates. If there is a subject or uranium stock that you want to discuss then please start a new thread and we will follow with our comments.

Many thanks to all of you who have signed up for our free Uranium Stocks Newsletter; we hope that you are enjoying it. We now have 3461 subscribers up from 3364 subscribers last month and approximately 22,000 readers per week which include a number of stockbrokers, banks and financial institutions, Chief Executives of uranium companies, etc.

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We have been inundated with requests for individual advice, which we are not allowed to give by law so please accept our apologies for not piling in to help you. We have also received a number of requests to cover individual uranium stocks or unique geographical areas, which we will try and get to in the weeks ahead.

A better month overall! Be patient and hang on in there.

Finally well done to the South African Rugby team who beat England last night to become world champions and well done to England who despite being under dogs throughout this competition did us all proud.











Friday
Oct192007

UEX Corporation: Up 31.90% in one day!

UEX Logo 19oct07


UEX Corporation jumped up $2.07 to close at $8.56 as 7.33 million shares changed hands. This increase in activity was due to a news release that reported the Second-Best Hole Ever at the Anne Deposit Intersecting Two Zones of High-grade Basement-hosted Mineralization: SHE-122-1 Intersects 4.73% U3O8 Over 33.7 metres, including 23.21% U3O8 Over 3.6 metres.

Stephen Sorensen President and CEO of UEX went on to say that:

"With the recent success at the Kianna Deposit, Anne has taken a back seat to Kianna, however, that is about to change. Anne's SHE-122-1 ranks in the top five holes at Shea Creek. The escalation of drilling and development programs by subsidiary AREVA at Shea is evidence of their confidence in the potential of Shea Creek becoming a future mining camp in the western Athabasca Basin of northern Saskatchewan."

To read the article in full please click this LINK, which will take you to their web site so you have the information first hand.

Taking a quick look at the chart we can see that yesterday’s closing price is above this stocks previous highs so we are now in uncharted waters and the stock could continue to zoom. The technical indicators are at the top of their range, which would suggest that it is time for a breather, however this discovery and the potential that it offers could negate the technical analysis for some time.

UEX Chart 19oct07

UEX Corporation trades on the Toronto Stock Exchange under the symbol of UEX and has a market capitalisation of $1.57 billion.

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Have a good one.
Thursday
Oct182007

Aurora Energy Resources Inc. Face Monumental Task

Aurora logo 18oct07


Aurora Energy Resources Incorporated is currently preparing a mine environmental assessment to be completed by the end of the year to put before Labrador's Inuit assembly. However a motion, which is scheduled to go to a second reading in the Nunatsiavut assembly in November, directs the self-government not to consent to a mine or mill on Inuit-owned lands, according to CBC News.

William Barbour, the minister of land and resources with the Nunatsiavut had the following to say:

“A committee will in the meantime study the benefits and drawbacks of uranium mining. He said Inuit leaders are feeling a bit overwhelmed by Aurora Energy's proposal.
"Maybe there is a safe method out there today, but these exploration companies who wish to go mining have to convince us that it can be done,"


John Roberts vice-president of Aurora said the company hopes to convince Inuit leaders that a mine can be developed safely and was pleased that the Nunatsiavut was initiating a process to debate the issue of uranium mining.

It is the old chestnut of jobs versus the environment again so we will monitor the situation and report back as and when significant developments occur.

Aurora Energy Resources Incorporated trades on the TSE under the symbol AXU and closed yesterday at $15.84.

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Wednesday
Oct172007

The Ranger Mine makes a Come Back

In a production report issued by Energy Resources of Australia Ltd (ERA) covering the quarter ending in September the company said production at its Ranger mine in The Northern Territory was returning to normal after heavy rains had flooded the mine earlier this year.

This is very good news for Ranger as contaminated floodwater is not the easiest of problems to deal with. Furthermore the company went on to say:

“In the latest quarter, drummed production of 1,363 tonnes of uranium oxide was 24 percent more than the same quarter a year earlier due to the processing of high grade ore made available through the implementation of various water disposal measures at the mine site”.

If there are any Ranger Mine fans out there that can enlighten us further on the progress at Ranger please feel free to add your comments.

Ranger Mine 17oct07

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Tuesday
Oct162007

Uranium ticks up!

Uranium Chart 15oct07
The first sign of light at the end of the tunnel appeared yesterday when the spot price for uranium managed to move higher by $3.00 according to TradeTech.

This is what they had to say:

“The uranium spot market showed the first signs of strengthening this week, after 16 weeks of falling or flat prices, with TradeTech’s Uranium Spot Price Indicator increasing $3.00 to $78.00 per pound U3O8. Buyers have begun re-entering the market and four transactions are reported. In recent months, a number of sellers have been motivated by cash needs, lowering offer prices or accepting bids below the current market price in order to secure sales. These sellers have now successfully placed the majority of this material and appear to have satisfied their near-term requirements. With this supply removed from the market, sellers, sensing that the market has reached an inflection point, are cautiously moving their offer prices up”.


This of course is good news and brings a few smiles back to a number of shell-shocked investors. If you have held through the recent carnage we suspect that your uranium stocks have now shown some signs of improvement so hang on to them. These stocks have been making a slow but steady recovery so do try and acquire some patients and hold on tight.

The spot price is the price that makes the headlines and sends us off in various directions implementing actions as though we have seen the light. Please remember it is not as important as the long-term price for uranium. Far more business is conducted via private arrangement than is conducted through the occasional auction. The long price of uranium remains at $95/lb, so think of it as akin to a 200dma and use it accordingly. We apologise for repeating ourselves but the number of new readers increases every week thus generating questions, which we thought that we had already covered.

In the near term we see this recovery continuing so if you have a few favourite uranium stocks that you have calculated to be relatively cheap then pick them up now and be prepared to sit on them for a year or so.

This message comes with its own health warning. This week our concentration could be somewhat diminished as England have reached the final of the World Rugby Cup against all expectations. The rugby played by the England team has been criticised as not being the most exciting to watch; however the objective of getting to the final has been achieved. There is a lesson here for all of us regarding objectives. Our objective is to make money. Being topical by rushing into the latest ‘hot’ stock with uranium stitched into the company name is not for us.

England Rugby Team 15oct07

Please feel free to add your comments especially if you think that we are wrong as this adds balance to the debate.

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Monday
Oct152007

Australian Uranium Policy: A Queenslanders view!

Map of Queensland 15oct07



Before any investment is entered into we should assess the political environment in terms of its acceptability to what is proposed. As Australia is home to the largest reserves of uranium then the Australian political scene is of immense interest to us.

One of our readers has sent us his view, which makes interesting reading below:

Anyone with an interest in Australian uranium properties is probably also curious about local attitudes toward exploration and exporting. The current liberal government has a forward thinking approach to nuclear energy already signing agreements with China, Japan, India and most recently Russia, however Australia is at an important cross road in federal politics. With an election announced on November 24th and the opposition labor party currently streets ahead in polls, it may be an important time to look closely at their uranium position.

As you probably know, for 25 years labor has maintained its “three mines” policy restricting uranium mining to existing projects. In April this year labor, led by Kevin Rudd voted 205 to 190 to abandon the old policy. This seems positive but there’s a catch. Currently the decision to mine uranium is left up to individual states and although most states oblige and profit, there are important exceptions.

Alan Carpenter, the labor Premier of Western Australia is steadfast in blocking uranium mining. His position is becoming increasingly uncomfortable as the federal government explores options to alter his perception. It is likely that a change in federal power and a labor prime minister may prove more persuasive. Queensland’s premier Beattie was also against anything uranium but has recently softened his stance. During his state party conference in July 2007, premier Beattie changed his rhetoric from blocking uranium mining to assuring local members that uranium enrichment is not on the agenda, a significant back flip.

The plot thickened when Premier Beattie announced his imminent retirement after nine years in power. He named Annah Bligh as his successor and begs the obvious question, “Who is Annah Bligh?”

Anna Bligh 15oct07

Annah comes from a strong labor left background. She has been groomed for the leadership role over the last two years with key portfolios in finance and business related areas. Her views on uranium have reflected her outgoing premier to date. On the 18th of May 2006 she addressed the Queensland Media Club seeking clean energy alternatives for her party stating, “Companies that want to explore for and mine uranium must work with scientists to lobby politicians and the public. Convincing them that the safety concerns that existed two decades ago, that we are somehow now in a position to resolve them.” By August 2006 her words had softened when Annah told the Courier Mail in Brisbane she was “Keeping an open mind towards uranium and labour’s no new mines policy” (22/08/2006). By March 2007 the government had received a report indicating that uranium mining would not adversely impact Queensland’s huge coal industry. The three mines policy was dropped in late April with both Beattie and Annah Bligh’s blessing.

Since April this year, the now Premier Bligh has sent mixed messages. She firstly reiterated her opposition to establishing a nuclear power industry in Queensland stating she would strictly limit its involvement to extracting uranium for export overseas. This sounds positive but in contrast on September 14th 2007 Annah Bligh gave an “unequivocal” commitment to the ban on uranium mining through a spokesperson, (source Bloomberg.com). It will be interesting to finally get a statement straight from the horse’s mouth.

When it comes down to it, Australia has a federal government that is aggressively pro uranium. They are currently pursuing uranium supply agreements internationally. States such as South Australia are supportive. The federal government controls mining approvals in the Northern Territory and the Tasmanian government has just made uranium mining legal. This leaves Queensland and Western Australia in lone opposition. Federal power is likely to change late 2007 and will be headed Kevin Rudd, a strong uranium advocate. He will probably have more influence on all eight state leaders who are from within his own party.

It seems that most leaders including Australia’s now understand that when it comes to nuclear energy it is not a question of ‘if’ but ‘when’. The people are slower to catch on and I sometimes wonder if the end game has already been decided for us. While the politicians talk tough on uranium mining in Queensland and Western Australia, state governments continue approving exploration licenses. This makes no sense unless future plans include a political change of heart. It may be strategic for some states to feign opposition to uranium and wait for an evil higher power in ‘the federal government’ to forcefully intervene. Watch this space!!!!

Paul Trevethan (Queenslander!)


If you would like to send us a ‘Johnny on the spot’ review of an area near you regarding any aspect of uranium mining we will do our best to publish it. By pooling our knowledge we will all be better informed and hopefully make better investment decisions going forward.

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Thursday
Oct112007

Incentives for a Boom in the construction of nuclear reactors!

BBC Logo 11oct07

There is an interesting article by Laura Smith-Park of BBC News, Washington, regarding the possible boom in the construction of nuclear reactors today.

The flood of applications now being generated for the construction of new nuclear power plants is gaining momentum and generating interest in this sector. This article lists a few of the factors behind the renewed enthusiasm as follows:

“The introduction of a new fast-track combined construction and operation permit, making new reactors easier and cheaper to build

A tax credit, introduced in the 2005 Energy Policy Act, of 1.8 cents per kilowatt hour for the first 6,000 megawatts generated by nuclear plants

Risk insurance adding up to $2bn for the first six plants to be built, protecting companies against the cost of delays in construction

Multi-billion-dollar loan guarantees

A likelihood that the cost of emitting CO2 will rise as the battle against climate change intensifies”


The risk insurance for delays in construction is one that caught our eye. We have mentioned in previous articles that delays in construction put millions of dollars at risk and could break a construction company not acquainted with claims resolution techniques, hence the proliferation of consultancies professing to have such skills. In a competitive bidding environment it is difficult for the contractor to make a provision for such delays, as their price will be rejected as too expensive. The more knowledge that you have about a project the more expensive your bid becomes and so on some occasions the ‘uninformed’ are awarded the contract. We think that such ideas serve as good incentives and will hopefully advance the process of getting this nuclear programme up and running.

To read the article in its entirety please follow this LINK.

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Wednesday
Oct102007

Laramide Resources: Up 8.32% yesterday!

LAM Logo 10oct07
The recovery continues for uranium stocks and yesterday it was Laramide Resources that took its place in the sun with a sparkling performance.

Laramide gained $0.63 to close at $8.20 on volume of 407,000 on the Toronto Stock Exchange where it trades under the symbol of LAM. This uranium stock was severely sold off in August during the scramble for cash and traded below $5.00 so it is pleasing to see investors coming back into this thinly traded market sector where the spot price of uranium at times can be a matter of opinion. However investors are now focused on the longer term uranium price rather than the spot price which is much more stable and less subject to the sometimes erratic behaviour of the spot price. The news flow continues to be good with the purchase of 5.6 million shares of Khan Resources and the recent acquisition of the Thunder Lake property.

A quick look at the chart and we can see Laramide has made good progress since the August sell-off and we hope to see it trade in double figures in the near term.

LAM Chart 10oct07



This uranium stock remains part of our core position and we expect it to double from here within the next twelve months or so.

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Friday
Oct052007

Aurora Energy Resources Inc: Update

Aurora logo 05oct07
Aurora Energy Resources Incorporated have recently announced their findings in five new drill holes at Jacques Lake Deposit in Coastal Labrador.

The company reported that the results: ‘have all intersected uranium mineralization, expanding the size of the Jacques Lake Deposit along strike by 50 metres and more than 150 metres down-plunge.’

They listed the highlights as follows:

0.13% U3O8 over 36.5 metres in drill hole JL07-066
0.16% U3O8 over 12.00 metres, including 0.27% U3O8 over 4.00 metres at in drill hole JL07-070.
0.11% U3O8 over 12.00 metres and 0.12% U3O8, over 3.31 metres in drill hole JL07-065.

From the drilling programme carried out last year, the Jacques Lake deposit contains 5.4 million pounds U3O8 indicated and 5.0 million pounds U3O8 inferred. The 2007 drill programme continues until the end of the year, which will then be followed by a winter working programme of extensive in-fill and delineation drilling. But for now the focus will be concentrated on expanding the deposit at depth and along strike. This is an aggressive action plan by Aurora with 75,000 metres of drilling this year, costing in the order of C$21 million.

To read the article in full which is on their web site please click this LINK.


FRG Logo
Thursday
Oct042007

Olympic Dam: More uranium!

The Sydney Morning Herald 04oct07

In an article carried by The Sydney Morning Herald BHP Billiton has announced plans to expand Olympic Dam's copper production to 500,000 tonnes a year at their Olympic Dam mine. However rumour has it that an increase in copper production to 1 million tonnes a year is possible with a by-product of about 30,000 tonnes a year of uranium production.

This raises the question of cost effectiveness for other budding uranium miners bearing in mind that the Olympic Dam project is producing uranium as a by-product of copper mining. The article goes on to say that an output of 30,000 tonnes per annum would represent more than 40 per cent of global demand. In terms of time frame this expansion is not expected to come on line until 2010.

The article also points out that other uranium miners such as “Paladin Resources predicts cash costs of $US23 a pound over the life of its Langer Heinrich mine in Namibia, and some of the other Australian uranium hopefuls could have even higher cash costs.”

This is something we need to bear in mind when doing a SWOT analysis and should be well and truly placed under the Threats section.

If you wish to read this article in full please click this LINK.

Have a good one

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