In Salamanca, located in Spain, miners started work in October on a $100 million uranium mine. Uranium prices are expected to soar in the international market with nuclear power set to cost more. And Berkeley Energia, the mining company wants to benefit when that happens. Berkeley Energia is listed on the junior AIM in London and in Australia.
The uranium mine
The mine has created about 500 jobs. When it becomes functional, it intends to produce 4.5 million pounds of uranium by the year 2018. According to reports in The Telegraph Berkeley raised nearly $30 million from the fresh issue of shares. It also won funding from Blackrock and JP Morgan.
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The site has been in development for over 10 years. Then it came upon high-grade uranium near its surface back in 2014. And Berkeley was keen to tap its potential from the inception. The uranium is present in the pool’s shallow part. This will keep the cost to about $15 per pound.
The prices are down
The prices of spot uranium are as low as those at 2003. It costs $18 per pound in the last fiscal, about half its previous price. CEO of Berkeley Paul Atherley will not mind the sagging prices as he is keen to get contracts for the long term. This is in order to get premium spot prices.
The demand is all set to increase
Large nuclear reactors are going to go off-supply in 2018 in Europe and US. This incites Atherley’s prediction that they will come back to the market. China is also building no less than 60 reactors. They too will have to shop for uranium around the same time, resulting in nuclear power set to cost more
As per the estimates of Cameco, the next decade will witness a demand of uranium to touch the 500 million pound mark. Cameco incidentally is Canada’s uranium producer. Tim Gitzel, Cameco’s head has a similar opinion like Atherley that the current market prices will not stay. And the prices can only go up as demand increases and result in nuclear power set to cost more.
Gizmodo further reports that two firms from China, China National Complete Engineering Corporation, and GGCL System Integration Technology will together construct a solar plant of 1-gigawatt at the Chernobyl Exclusion Zone site. This would be nearly 30 years since the accident took place.
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Picture Courtesy: Bjoern Schwarz/Flickr