Hi easyp, personally I think that by far the largest factor in driving up the SP will be any rise in the long term contract/ spot price for uranium. When this happens, who really knows but with U3O8 prices at rock bottom lows at the moment, surely we will start to see some kind of recovery here within the next few months. IMHO I can't see how the Omani deal can have any negative effect on the SP at the present time; it was an excellent deal for BKY and it seems that their investment strategy is definitely long term. Cheers, Brox
Thanks TBBT/ Baht. At least nothing's being hidden in this case! Agree with your "manana" theory; I'm sure that if there was any serious problem with these permits, BKY would be obliged to release an RNS stating as much. Rather an underwhelming response from the markets after this report as may be expected...
I tend to agree that the timescales seem a bit vague. No bad news but nothing to get too excited about either. I thought that there was a Nuclear Safety Council permit to be approved, but there's no mention of this here. Maybe I'm wrong? If the final permits are due to be granted during 2019 as mentioned here, it looks like it may be optimistic to start full production by mid 2019 as previously stated. "To date, the Company has received more than 120 favourable reports and permits for the development of the mine. The Urbanism Commission of Salamanca gave an Express Resolution for the granting of the Authorisation of Exceptional Land Use. With the Mining Licence, Environmental Licence and the Authorization of Exceptional Land Use the next major approvals are the Urbanism Licence by the municipal authority and the Construction Authorization by the Ministry of Energy, Tourism and Digital Agenda for the treatment plant as a radioactive facility. Approvals for the Zona 7 deposit are progressing well, the Exploitation Plan, the Reclamation and Closure Plan, the Environmental Impact Assessment and the Initial Authorization are complete and have all now been submitted to the relevant authorities. The final approval is expected during 2019 as previously announced."
Yes indeed. I spoke too soon about these dark pool trades!!
Well, the March 2018 Quarterly Report should be released tomorrow or Friday. I'm just hoping for some real news to get us all excited about BKY again. Maybe an update on the Nuclear Safety Council radioactive use permit, maybe an update on drilling/ exploration results... Long term/ spot price is unbelievably and unsustainably low at the moment; that's what is holding our SP down. This can't last for much longer surely. https://www.cameco.com/invest/markets/uranium-price However, it's been good to see quite a lot of buying activity here lately by smaller PIs lately, plus the larger dark pool trades/sells seem to have reduced significantly. Go on Paul, cheer us up!!
Global X doesn't hold any Aura shares (yet) easyp, so I don't really see any correlation there. Even with today's rise they're still about 22% down compared to this time last year (BKY 2% down in same period), though the potential upside of Aura, being at a much earlier stage, could be greater. Good luck over there though!
New York-based ETF provider Global X Funds has announced that the Global X Uranium ETF (URA US) will transition to a new index, the Solactive Global Uranium & Nuclear Components Total Return Index. https://www.etfstrategy.co.uk/global-x-funds-uranium-etf-to-adopt-new-index-33882/ https://www.globalxfunds.com/content/files/URA-sumpros.pdf Stocks in the new index are screened for liquidity and weighted according to free-float market capitalisation. A specific capping methodology is used at the time of the semi-annual index review to enhance diversification. The maximum weight of a �pure play� company is 20%, with �non-pure play� company weightings capped at 4.5%. Further, the sum of weights of all components that have a market capitalisation smaller than $100 million must not exceed 5%. The fund is expected to begin implementation of the change on or after 2 April 2018. The main point from our perspective is that as our market cap, even at his low SP, is c. $180m so we would not fall into the category of the restricted percentage of small caps. This suggests that we would not be a target for selling off to fulfil this criteria.... We'll see I suppose.
Having said that, I do suspect that there has been a sell-off of BKY, possibly a continuation from Anglo Pacific as spotted by omilik92 a month or so ago. Change in substantial holding RNS possibly forthcoming? On the subject of RNS's, we're due the latest quarterly report within the next 10 days or so. It would be good, in fact massively good, to hear updates on the permitting process with regard especially to the final part of the radioactive licensing and some substantiation of further drilling/ exploration results. It's just been a bit quiet news wise here lately.
Latest URA holdings here: http://portfolios.morningstar.com/fund/holdings?t=ura I don't see a large sell off of BKY here...or am I missing something...??
Really interesting article - thanks Baht.
You may also find this report from world-nuclear.org useful: http://www.world-nuclear.org/information-library/nuclear-fuel-cycle/uranium-resources/supply-of-uranium.aspx There is a strong suspicion that the Chinese stockpiles/ inventories may be much higher than stated here; they have been buying very significant amounts from Kazakhstan for a good while now. The estimates of the requirements of power utilities which are supplied by mines which I can find varies from 62% (Wiki) to 86% (Denison). http://www.denisonmines.com/s/Secondary_Uranium_Supply.asp There is a strong consensus however that these secondary supplies are being diminished and at some point we are are going to enter into a supply side deficit...just when is the question. The recent mine closure/ production cuts are excellent news with regard to this equation of course.
Fully agree, Tom. There's so much more to be made when the spot price recovers; reducing supply is the obvious economic driver to achieve this.It was interesting to see the level of overseas investment in the Kazakh mines in the report - higher than I initially thought. It also seems that a large proportion of their output is traded on the spot market. I also found this tie-in to the US interesting: "In October 2015 Kazatomprom signed an agreement with Centrus Energy to help market Kazakh uranium in the USA. In April 2016 Kazatomprom signed an agreement with US-based Converdyn so that Kazatomprom could offer uranium for sale in the form of natural UF6, and access new markets with an �integrated product offering�, giving customers �increased supply options�. This is simply a marketing alliance, complementary to the Cameco investment in Ulba. Also in April a Kazakh-US energy partnership agreement was signed, related to nuclear security and in particular the �conversion of Kazakhstan's research reactors and enforcement of physical nuclear security." I wonder if we could be hearing more about this in the near future..??
Hi Tomcorvid/ Playboy007, I've found this fairly comprehensive report including production figures per mine in Kaza if it helps: http://www.world-nuclear.org/information-library/country-profiles/countries-g-n/kazakhstan.aspx
Yes, easyp, it's been frustrating for a while with regard to Uranium for sure. The time frame for seeing a good return on our investments here seems to keep moving further and further into the future. I bought in here in Sep 16 thinking that in 18 months time we should begin to see some reward materialising. Now in April 18, I'm hoping that in 18 months time..... Sep 16 is also when I sold out of most of the FTSE 100 shares I held due to my personal prediction of an imminent stock market crash. Ocado & Easyjet were badly timed to say the least; British Land, M&S not so bad, so would not be too far up or down over the piece really. Always been a bit early for the party maybe...:) With regard to BKY, I really can't see IMHO that the Omani investment is having any negative impact on our SP here whatsoever; this deal far exceeded anything I could have hoped for with regard to funding. It surely must be recognized that these chaps are in here long term; they wanted a "best price" guarantee for supplies of U3O8 as part of the deal after all. It certainly will be interesting with regard to energy security for Germany as you say; it does seem like France are retracing from their agenda of reducing nuclear energy production. Russian gas may become a political bargaining tool. Where are the Germans going to source their power...? I've thought about investing in Energy Fuels, UR-Energy, Uranium Energy Corp, etc ( US Uranium Co's) and would certainly not put anyone off as these are likely to fly if Trump grants them protectionism - though not sure this can/ will happen. Even if protectionism doesn't happen, they look well positioned to take advantage when the long term contract prices eventually rise.
Here's the latest list of holdings and changes in the Global X Uranium ETF as at 27 March: http://portfolios.morningstar.com/fund/holdings?t=ura It doesn't look like it's BKY they're selling to any degree at all; they are making other fairly significant disposals however and few, if any, acquisitions. In fact we're back up to No.4 in their top holdings!
I must say that I do find this downward trajectory of the share price a bit puzzling. It's hard to see much of a downside compared to where the company was a year or so ago or more, but the potential upside surely seems to be still intact. It does seem that if there IS any concrete news about signed and sealed larger scale contracts, this one could take off quite dramatically, and quickly. Still looks like a longer term play to me (months rather than years mind you), but at this SP I had to have a small top up! Let's see what transpires I suppose.
The long term contract price of Uranium, which IMHO is by far the biggest driver with regard to the share price of BKY, is now at it's lowest level since July 2005. We are surely reaching the inflection point on this graph, especially taking into account the latest production cuts and a suggestion from many observers that we are now about to enter into a supply side deficit. https://www.cameco.com/invest/markets/uranium-price I see there are still a number of these dark pool trades showing from IIs selling from a short term perspective, but it is surely a matter of time before there is a marked reversal from this decline in the price Uranium, and indeed the stagnation of the BKY SP. Just when. Maybe the resource update we were due in Q1 was the information in the half year report; drilling and exploration is concentrated around Salamanca I and II rather than Zona 7 apparently. Can't factor in the Omani loan as suppressing the SP here personally.
Yes, well spotted omalik92. Bit strange that this RNS has not appeared on this site; I checked the London Stock Exchange and apparently an RNS was issued on Tuesday afternoon with regard to this disposal. AP still retain 85%+ of their holding mind you.
This certainly doesn't seem to be company specific. Using Global X as a proxy for the uranium sector as a whole, in the last three months, BKY down 14.53%, Global X down 18.35%. In the last year, BKY down 9.09%, Global X down 16.78%. Uranium still just unloved in general at the moment. These IIs need to take a much shorter outlook on returns than us PIs in order to meet monthly/ quarterly/ yearly targets. We have the advantage of being able to hold out for a much longer term perspective on our investments, even if it all takes a bit longer than hoped for.
RNS from ASX: The recent dark pool trades must have involved Anglo Pacific reducing their holding in BKY by 2.734m shares. Begs the question of who has been buying these up I suppose since there has been minimal share price movement? https://www.asx.com.au/asxpdf/20180309/pdf/43s9r4h1cv90ng.pdf