Peak Uranium By 2015?

A new research report says yes. The report goes on to say that short of a complete nuclear phase-out, the world will run out of uranium by the end of the decade. Here are the major conclusions:

• A production decline from essentially all mines operating on particular deposits is unavoidable during the present decade.

• This decline can only be partially compensated by the planned new mines.

• Assuming that all new uranium mines can be opened as planned, annual mining will be increased from the 2010 level of 54 ktons to about 58 ± 4 ktons in 2015.

• After 2015 uranium mining will decline by about 0.5 ktons/year up to 2025 and much faster thereafter. The resulting maximal annual production is predicted as 56 ± 5 ktons (2020), 54 ± 5 ktons (2025) and 41 ± 5 ktons (2030).

Assuming that the demand side will be increased by 1% annually, we predict both shortages of uranium and (inflation-adjusted) price hikes within the next five years.
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Therefore, assuming that a global slow phase-out scenario will not be chosen on a voluntary basis, we predict that the end of the cheap uranium supply will result in a chaotic phase-out scenario with price explosions, supply shortages and blackouts in many countries.

To read the full report: click here

The report contends that the only way for supply to keep up with demand would be if the US and Russia recycle their nuclear weapons into low enriched uranium fuel. The Russians have been doing this since 1993 under the Megatons to Megawatts program, but the program is expected to end in 2013. The Russians have indicated that they do not expect to renew the program.

This is bullish for uranium and the uranium stocks. And after the Fukushima disaster, the stocks need all the help they can get. Most of them have now fallen 70-85% from their 2011 peaks

Black Swan Insights

Peak Uranium By 2015?