Dr. Keith Barron: I Think That the Bottom in Uranium is in Right Now – 8/17/2014
This week we have Dr. Keith Barron as our guest. Keith is an exploration geologist with over 30 years’ experience in the mining sector. In 2001 he privately co-founded Ecuadorean gold explorer Aurelian Resources Inc., which made the colossal Fruta del Norte gold discovery in 2006. He is also the founder of U3O8 Corp, a uranium exploration company. We brought Keith on to get his unique perspective on the uranium sector, at a time when most uranium companies are struggling to keep alive.
With the uranium price around $28 – $29 pr. pound, Keith thinks that the bottom is in right now. It’s really about the circumstances in Japan and as soon as the first reactor in Japan is turned back on, Keith believes we will see a very quick double in the spot price for uranium.
When asked about which other catalysts Keith sees being positive for the uranium price, Keith states that the uranium market has long been in a deficit in regards to supply and demand. The ‘Megatonnes to Megawatts’ program between Russia and The U.S., ended last year. This will add to the deficit situation.
Keith points out that despite Japan turning off all of its nuclear reactors, the country has continued their purchases of uranium. He believes that many investors may see this as creating an oversupply of the fuel. But, Keith says savvy people know that Japan’s uranium is going out the back door to China. China is in desperate need of the nuclear fuel to help slow down the pollution in major cities.
Next, on the topic of which uranium projects investors should get into… Keith thinks that the wise thing to do is to spread one’s exposure between exploration companies, companies going into production, and the large uranium producers. But, it is certainly in the junior companies that investors will be afforded the most leverage.
Finally, we ask Keith to talk about Argentina, a jurisdiction where uranium is a preferred source of energy, but has recently defaulted on their debt obligations. He points out that Argentina just signed an agreement with China to build their fourth nuclear reactor. Argentina is now in a situation where they need raw material to run these reactors. It is possible for uranium companies in the country to fill that gap. Since the bond market window will be closed to the country, Keith thinks Argentina will be more open for business.
Keith points to U308 Corp as a great option for investors looking to benefit from the imminent rise in spot price.
Dr. Barron is an exploration geologist with almost 30 years’ experience in the mining sector. He holds a Ph.D. in Geology from the University of Western Ontario and a BSc. (Hons) in Geology from the University of Toronto. He has worked in more than 20 countries, in North and South America, Africa, Australia, Europe and Asia in the search for gold, silver, diamonds, base metals and industrial minerals. In 2001, he privately founded Ecuador gold explorer Aurelian Resources Inc., which was listed on the TSX-V in 2003 and made the colossal 13.7 million ounce Fruta del Norte gold discovery in 2006. The company was bought by Kinross Gold in 2008 for $1.2 billion. He is also the founder and a Director of South American uranium explorer U3O8 Corp. (UWE:TSX) and a Director of Firestone Ventures (FV:TSX-V). At the PDAC convention in March 2008 he was awarded the Thayer Lindsley International Discovery Award for his role in the discovery of Fruta del Norte and he was also jointly named the Northern Miner’s Mining Man of the Year 2008.