The spot price of uranium edged closer to the $US100 per pound mark overnight with the move driving up the share price of Australia's yellowcake brigade.
The spot price surged to its highest peak since the 70s and hit $US95.00 a pound overnight.
Uranium miners Energy Resources of Australia Ltd and Paladin Resources Ltd followed the price jump, gaining 7.17 per cent and 2.03 per cent by 1253 AEDT, respectively.
Of the advanced explorers, Energy Metals Ltd moved 10.78 per cent higher to $5.65 by 1254 AEDT, Nova Energy Ltd gained 11.43 per cent to $3.90 and Toro Energy Ltd added 7.77 per cent to $1.04.
The drivers for nuclear energy growth are well documented and include increasing global electricity demand and global warming concerns, pointing towards an increasing demand for nuclear energy and therefore uranium.
The demand for uranium is also expected to be driven by the proposed construction of 178 new nuclear reactors, a 40 per cent increase on the current global fleet of 441.
The uranium price has almost doubled since July when it was fetching about $US48.00 per pound on the spot market.
The increase in price is also spurning an increase in corporate activity in the sector with takeovers and the spin-out of new uranium focused companies on the rise.
"There is an increasing amount of corporate activity occurring in the Australian uranium sector as the long awaited rationalisation and consolidation phase commences," analysts from StockResource said in a March 7 client note.
These include Paladin's $1 billion bid for Summit Resources Ltd and Hong Kong-based investment bank Crosby Capital Partners' $206 million bid for Marathon Resources Ltd.
© 2007 AAP
Actually PDN priced edged higher overnight on the TSX 2.27% up in good volume over 2,000,000 whereas Wall Street went down almost 100 pts. In the last few days the ASX seems to have followed the TSX with regards to PDN so I am hoping for a strong showing today in an overall down market.
Any thoughts on that?
Morning all.
Why the big drop in PDN today?
Cheers
eMark
Well, PDN's hostile takeover target (SMM)is in a trading halt pending the announcement of a third party alternative.
Mark.
Less than 1% of SMM holders accepted PDNs offer.
(And if i held SMM, i would be one of them!)
Note than SMM also was in a trading halt yesterday.
I guess it is logical for Areva to takeover PDN as well. I guess it is more a defensive act for it to invest in SMM, rather than finding value. Cannot figure it out what is in French's mind. Invest a lot of money in a state that might never allow to mine.
French vs QLD Government..
Obviously those big people are much more in the know than us.
I'm not sure if they'll go for anything without a more advanced resource, at least close to JORC. They seem to want an Australian operation, and to be honest, I was surprised they pursued SMM after Beattie made his policy clear. Perhaps they are thinking much more strategic than me. The Mt Isa region could be one gigantic U mine in a few years. Other than SMM, where will they turn? I can't see why they would initially go anywhere but NT and SA in the short term. Pick the best independant resources there for potential takeover options...what options for pdn if they dont get sumitt? will they look for a nearby site like URL?
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