When the world’s largest physical uranium fund raises more than double what it was targeting you know something is on the boil.
In June, the Sprott Physical Uranium Trust upsized its bought-deal financing to US$200 million ($305.7 million) from US$100 million previously, with Canaccord Genuity underwriting the entire amount.
The trigger for this spike in interest was none other than US President Donald Trump, who in May announced four executive orders designed to reignite America’s nuclear industry.
Declaring it an “American nuclear renaissance”, Energy Secretary Chris Wright said at the time the news was announced that the US was restoring a strong American nuclear industrial base, rebuilding a secure and sovereign domestic nuclear fuel supply chain, and leading the world towards a future fuelled by American nuclear energy.
“With the emergence of AI and President Trump’s pro-American manufacturing policies at work, American civil nuclear energy is being unleashed at the perfect time,” Wright said.
“Nuclear has the potential to be America’s greatest source of energy addition. It works whether the wind is blowing, or the sun is shining, is possible anywhere and at different scales.
“President Trump’s executive orders today unshackle our civil nuclear energy industry and ensure it can meet this critical moment.”
Less than a month later the Sprott Physical Uranium Trust issued 11.6 million units at US$17.25 per unit to raise US$200 million.
Charu Chanana, Chief Investment Strategist for online trading and investment firm Saxo, says policy support for nuclear is accelerating with the US preparing to invoke the Defense Production Act and fast-track reactor approvals, while global players from China to France accelerate nuclear expansion.
‘Supercharged’ growth
The key catalysts for this nuclear revival, according to Chanana, are “supercharged” interest from artificial intelligence and data centre energy demand, long-term tech collaborations for sustainable power sources, and global momentum.
“France, Japan, South Korea, and even China are accelerating nuclear plans,” Chanana says.
“Attendance at the Nuclear Energy Institute’s finance summit surged 50% this year – evidence of fast-rising institutional interest.”
Nuclear power accounts for about 10% of the world’s electricity and about 20% of Europe’s electricity, according to the World Nuclear Association.
“France, Japan, South Korea, and even China are accelerating nuclear plans”
The rising global population combined with rapid urbanisation is going to require a significant increase in energy in the years ahead.
The United Nations predicts the world’s population will grow from about 8 billion in 2024 to around 9.8 billion by 2050.
The World Nuclear Association says the process of urbanisation – which currently adds a city the size of Shanghai to the world’s urban population every four months or so – will result in about two-thirds of the world’s people living in urban areas by 2050, up from about 55% in 2022.
“The challenge of meeting rapidly growing energy demand, whilst reducing harmful emissions of greenhouse gases, is considerable,” the organisation notes.
“In 2023 global energy-related carbon dioxide (CO2) emissions rose to 37.4 gigatonnes, the highest on record, and over 60% above the total in 2000 (23.2 gigatonnes).”
Jordan Trimble, CEO of Canadian uranium explorer Skyharbour Resources (TSX-V:SYH), says the West has relied heavily on uranium and nuclear fuel imports from countries like Kazakhstan, Russia and Niger, which introduces significant geopolitical risk.
“Western governments and utilities are now recognising this vulnerability and are starting to prioritise supply from Western jurisdictions,” he tells Mining.com.au.
“To secure future uranium supply independent of geopolitical risks, the West must ramp up production within uranium producing jurisdictions like the Athabasca Basin, streamline permitting, and invest in conversion/enrichment capacity as well as nuclear fuel cycle infrastructure.”
Red tape cut for uranium projects
Trimble says the executive orders from Trump aim to cut red tape around uranium mining and new nuclear builds by invoking the Defense Production Act, fast-tracking reactor approvals within 18 months, and opening up federal lands for advanced nuclear deployment.
“These actions also encourage public-private partnerships and international cooperation to reduce reliance on unreliable suppliers and position the US as a global leader in nuclear energy,” he says.
“The administration has stated they would like to see a quadrupling of US nuclear energy by 2050 including 10 new large reactor builds underway by 2030.”
Skyharbour has a portfolio of uranium projects in Canada’s Athabasca Basin – one of the world’s richest sources of high-grade uranium, accounting for about 20% of global supply.
The basin spans 100,000km2 and hosts major deposits including Cameco’s (TSX:CCO) Cigar Lake and McArthur River mines.
Skyharbour has an interest in 36 projects spanning over 614,000 hectares.
Trimble says the Athabasca Basin has seen a notable uptick in mergers and acquisitions (M&A) and strategic investments recently, underscoring its strategic importance in the global uranium sector.
In December 2024, Paladin Energy (ASX:PDN) completed its over C$1.1 billion ($1.2 billion) acquisition of Fission Uranium (TSX:FCU), which added the high-grade Patterson Lake South Project in the Athabasca Basin to the Paladin stable.
In October 2022, Uranium Energy (NYSE:UEC) expanded its footprint in the region via the acquisition of Rio Tinto’s (ASX:RIO) Roughrider Project in 2022 for US$150 million.
In August of the same year, Uranium Energy completed the acquisition of UEX Corp for C$260 million.
“These recent transactions reflect a broader trend of consolidation and strategic positioning within the Athabasca Basin, driven by the global need for secure and sustainable uranium supply especially in Western jurisdictions,” Trimble says.
Skyharbour is evaluating strategic opportunities, including partnerships, joint ventures, and accretive acquisitions.
The company utilises a prospect generator model, bringing in partners to fund exploration and make cash and share payments to Skyharbour, which has amassed over 1.5 million acres of uranium claims and has the third largest landholding in the Athabasca Basin.
Skyharbour currently has nine partners, including three joint ventures and six active option partners, spending potentially over C$70 million in combined project consideration (exploration funding, cash and share payments) across 13 properties.
“This is a multi-faceted strategy that allows us to stay focused at our core projects while partners advance some of our other assets,” Trimble explains.
“If any of the partners are successful with their exploration, that will be a key catalyst for a rerate higher for Skyharbour without us having to continuously raise money and dilute to fund the work at these projects.”
While M&A is on the rise, Johan Lambrechts, CEO of copper and uranium explorer Antares Metals (ASX:AM5), says Western companies are generally a lot slower to lock in potentially lucrative opportunities than their Eastern counterparts.
“The business model of the western world includes risk mitigation as a crucial component of our process. Therefore it actively avoids opportunities if the risk is perceived excessive,” he tells Mining.com.au.
“There is merit in managing risk, but it means that many opportunities in areas like Africa go begging and are acquired and advanced by Eastern competitors.
“At some level, I think the risk of losing opportunities and allowing competitors to pounce and directly compete on the market also needs to be included in the assessment.
“In addition, the west is generally very slow in its decision making, and even if it were willing to compete, it often loses out to a far nimbler and fast moving east. I’ve experienced this firsthand in Africa.”
Antares has a 2,000km2 landholding in Mt Isa, Queensland surrounding Paladin Energy’s Valhalla Uranium Deposit, which is considered the largest undeveloped uranium deposit in the state. The deposit hosts 28.9 million pounds of measured resources, 34.5 million pounds of indicated resources and 12.8 million pounds of inferred resources.
Lambrechts says the time is now, for any company with uranium prospectivity, to explore, identify and realise their resources and take their place in this steady supply chain for uranium resources.
“Antares plans to do just that. We have a strong uranium portfolio with real potential to discover more deposits, while we also have a uranium resource (JORC 2004) which we plan to convert to JORC 2012 and upgrade even further,” he notes.
Juniors positioning for supply gap
The US imports 95% of its uranium because it has very little production.
Bruce Lane, executive director of US-focused explorer GTI Energy (ASX:GTR), says if nuclear is 20% of US energy demand, and the country is going to double the amount of energy it requires, then the number of reactors will need to increase from 95 to 200 just to maintain that 20%.
“If you look at a state like Texas – which is not the biggest data centre or hyperscaler state but it’s certainly significant – they’re looking at sort of 80 or 90 gigawatts of new power within about the next 10 years. That’s the equivalent of the entire existing US reactor fleet,” he tells Mining.com.au.
Wyoming, Texas, Colorado and Utah provide the lion’s share of the roughly 1 million pounds of annual uranium production the US currently produces.
However, with the US commitment for a lot more nuclear power by 2050, the country is going to require 67 million pounds each year of uranium supply by 2035.
GTI is advancing its 8.57-million-pound Lo Herma Project in Wyoming’s Powder River Basin and last month completed a Scoping Study outlining a proposed in-situ recovery (ISR) operation producing around 800,000 pounds each year.
ISR uses injection wells that add oxygen and carbon dioxide creating a lixiviant solution.
Uranium dissolves into the solution and recovery wells pump the solution back to the surface to a processing facility.
Over 50% of global uranium is produced through ISR, which requires no tailings, has minimal dust and less water consumption. This means operating costs are around two thirds of conventional mining.
Lane says most of the projects in Wyoming are amenable to ISR, particularly alkaline leaching ISR which eliminates the need for acid use in the bore.
“It’s very environmentally benign from a surface disturbance point of view,” Lane says. “We see ISR fitting really well with the kind of macro theme around sustainability and social licence.
“We think it will continue to have a very large part to play in supplying uranium.”
Capital starting to flow into uranium
GTI just raised the first $2.5 million of a $4.5 million two-tranche private placement, with the remainder of the funds subject to the approval of tranche two at an upcoming general meeting.
Funding continues to open up for uranium explorers as evidenced by last week’s commitment by global investment management firm Davidson Kempner to provide US$15 million in debt financing for Peninsula Energy’s (ASX:PEN) Lance Project in Wyoming.
Warrick Clent, Managing Director of African uranium hunter Connected Minerals (ASX:CML), tells Mining.com.au that over the past six months there has been a noticeable shift in how institutions and analysts are viewing nuclear energy.
“It seems like they are now recognising the potential of nuclear as the foundation of a clean energy policy for many decades ahead,” Clent says.
“While significant capital may not be flowing to junior uranium explorers and developers yet, we are confident that Connected Minerals is on track for when it does.”
Connected relisted on the ASX in 2024 and is advancing exploration at two projects in Namibia.
The company is gearing up to undertake phase-two drilling at the 30km2 Etango North-East Uranium Project after maiden drilling returned economic grades showing similarities to Bannerman Energy’s (ASX:BMN) Etango Uranium Project.
Connected has also completed initial reverse circulation drilling at the Swakopmund Uranium Project to follow up geophysics results that confirmed potential paleochannels.
The company’s portfolio of projects sits near the majority Chinese-owned Rössing Mine, which came online in 1976 and yielded roughly 6.4 million pounds of uranium in 2024.
Clent says jurisdiction continues to be a major factor in uranium supply discussions.
“With insufficient acid supply affecting production in a region like Kazakhstan and geopolitical instability and sanctions against Russian impacting supply of enriched uranium into the United States, operating in a stable jurisdiction like Namibia becomes even more valuable for Connected,” he tells this news service.
“Namibia is regarded as a safe, reliable supplier of uranium with five decades as a producer.”
Namibia is the world’s third largest uranium producer, accounting for about 10% of global supply and hosting roughly 7% of the world’s uranium reserves.
“As a well-funded junior with relatively few peers, we have secured a first-mover advantage in Namibia, one of the world’s leading uranium producing jurisdictions,” Clent says.
“Exploration programs are rapidly advancing at our projects with a long-term view so that as the supply gap peaks, potentially somewhere between 2028 and 2035, we are well placed to develop new uranium resources.”
Write to Angela East at Mining.com.au
Images: Mining.com.au, GTI Energy, Skyharbour & Connected Minerals
