Q: I have followed nuclear energy and Cameco for about three decades. It has been a tough investment environment for most of this time. We now are seeing a dynamic change in sentiment and planned expansion in this part of the energy sector. As an optimistic investor heavily invested in uranium stocks, I expect to have further capital gains as nuclear plants are built. However, it appears that some of the new modular reactors will use spent fuel rods as the source of uranium to run their reactors. Do you see this having a significantly negative impact on uranium demand going forward? Also, will the BEP’s Westinghouse purchase be material to the company in an expanding demand for nuclear energy?
With appreciation,
Ed
With appreciation,
Ed
5i Research Answer:
While we think the Westinghouse deal was positive, BEP did share its interest with its institutional investors. Still, it represents 10% to 15% of BEP's market value, so is important. Westinghouse continues to sign attractive contracts and will provide growth to the JV. Companies such as Oklo are developing technology to use spent rods, but based on our knowledge their success, if it occurs, is still many years off. In the interim, uranium will likely remain in a deficit position and we would not expect a negative impact to the sector.