Member Info for flundra

Bit odd today. -3% ASX, +8 Madrid, -6 London. Not entirely fungible perhaps, or some exchange arbitrage at play perhaps.

Leak?

https://www.lamoncloa.gob.es/lang/en/presidente/news/paginas/2020/20200731conf-presidents.aspx

From 31 July:

"Pedro Sánchez stressed that Spain is a decentralised State in which the regional government authorities hold very important powers over health issues and economic development and that, without them and the local council authorities, "we would be unable to mobilise all the economic resources we are going to need for our economy to recover"."

A couple of weeks later the local council authority under the regional government framework grants the urbanism licence. So if you interpret this as local and regional government effectively saying "si" to the mine, you could say it would be inconsistent following Sanchez's stated approach, for central government now to effectively say "no". Or perhaps easier to say "si" so as not to be seen to be interfering with the locals' decision.

OK the context of Sanchez's comments is not specifically about the mine but they perhaps emphasise the relative importance of last week's local/regional decision.

I don't think there have been any recent leaks from central government like what appeared in the previous Reuters article indicating which way this is going, despite the fact it's hotting up.

Also, the more favourable reports and decisions that emerge and are acted on, the greater any compensation claim is likely to be if it's "no", presumably. Perhaps gives the SP some downside protection.

A "no" from central government now would fly in the face of all previous central, regional and local government decisions, not to mention the CSN report, to favour minority ideology. Unconscionable.

A step forward, and IMO it's now really first about NSC report completion and ratification, secondly the shape of the new climate law, and assuming that doesn't raise obstacles or outlaw uranium mining, thirdly whether the federal government (Ministry of Ecological Transition and Demographic Change) are prepared to re-think the previous reported approach of refusing authorisation in any circumstances (Reuters quoting anonymous sources from the last PSOE/Podemos coalition), and give authorisation.

It's...denies and will vigorously defend the claim

18.6% contraction and 1m+ job losses (mainly in services and tourism) in 2nd quarter. Permitting the mine could really help the economy, as well as help reduce emissions and keep the grid going.

https://www.bbc.co.uk/news/av/science-environment-53644147/james-lovelock-gaia-theory-creator-on-coronavirus-and-turning-101

I think where we are at the moment is…
…awaiting finalisation of the favourable CSN report, then its ratification by the CSN board. There’s many a slip twixt cup and lip, but I understand that legally (at the moment) it would be very difficult for this not to happen now.
Then it’s over to the government for permitting (or not). Also relevant is the climate bill (most of which looks very sensible and concentrates on emissions reduction), particularly any attempts to reduce nuclear power and outlaw uranium mining.
BKY will hope the arguments prevailing will be that (quoting a senior industry adviser) “you won’t get remotely close to net zero carbon emissions by 2050 without big nuclear power”. The wind and solar the Spanish government promote are great, but, as they and everyone know, don’t give the grid the inertia to maintain the frequency, that coal and nuclear do. Take away the coal and hydrocarbons like they’re committing to, and you’re only left with nuclear for the baseload and inertia to keep it stable…
And re mining, why adopt double standards and import your 1600 tonnes of uranium pa, when you could produce it securely yourself. The supply side is becoming squeezed, so why let your own mining regions languish, and hand the profits to the likes of Kazakhstan…?
Spain is more separate from the European grid than most, therefore needs a broad energy mix more than most, and wind is becoming more expensive as shallow off shore sites are used up. Best of luck to Spain even if they do abandon stability and pragmatism for minority ideology, but maybe it’s best not to.
Every aspect of nuclear will doubtless be challenged by the anti-nuke movement on an ongoing basis.

Not much to get your teeth into here.
CCO are restarting Cigar Lake, and Tim Gitzel put it well in yesterday's quarterlies:
"As noted recently by the International Atomic Energy Agency, while electricity demand in the near-term has declined, the proportion of nuclear power has increased relative to fossil fuel sources which demonstrates the resilience of the clean, carbon-free, base-load electricity generation that nuclear power provides."

Iter tokamak 5 yr assembly phase underway. Fission for now, commercial fusion in say 20 years for unlimited clean reliable emissions free energy?

https://www.bbc.co.uk/news/science-environment-53573294

The main thrust of the Ecological Transition was and still is about emissions reduction and doing away with hydrocarbons in favour of renewables, photovoltaic solar and wind principally.
Ca 21% of Spain’s energy is produced from nuclear, the most reliable baseload source (with hydrocarbons). The 1600 tonnes of uranium used in Spain each year is all imported, some of it from unstable countries. Spain is also effectively separate from the European grid.
Kind of makes sense of to keep the nuclear capability, secure domestic U supply, and revitalise the region to complete a virtuous circle? The lights would stay on too.
Well judged and well timed comments from Sr Bellon urge that this project should not be rejected on ideological grounds, driven particularly by influences from some within Podemos/Ecologistas.
The other responsibility of this ministry is "Demographic Challenge", which in this region's case is intergenerational unemployment and social desertification.

imo.

https://www.world-nuclear.org/information-library/country-profiles/countries-o-s/spain.aspx

Spain's energy security and new climate law proposals and goals are surely unachievable without domestic nuclear in the short and medium term at least. There's little point anyone burning boats/tying own hands on the issue at this point. imo

https://www.csn.es/en/noticias-csn/2020/-/asset_publisher/7wHne5sV6dgf/content/el-pleno-informa-favorablemente-la-solicitud-de-renovacion-de-la-autorizacion-previa-de-la-planta-retortillo

Over to the ministry. Fingers crossed. Ribera has spoken recently of "putting people are at the heart of policies for climate neutrality by 2050...a transformation that serves to rebuild better, but also creates jobs and ensures a healthier environment without leaving anyone behind". Perhaps not inconsistent with a 15/20 year restore-as-you-go mine, which ticks all the regulatory environmental boxes, and would help save an economically depressed area.

https://www.lamoncloa.gob.es/lang/en/Paginas/buscadoravanzado.aspx?_searchTextFromTop=environment

I'm a tad more hopeful than you l7, and suspect an award in CNE's favour would be the start of the next chapter, not the end of the story. India will box clever for sure, look for ways around it, and if possible avoid paying but keep desperately needed foreign investors sweet, even if CNE are expendable. ****ing a snook at the treaty and the international arbitration process wouldn't be an easy decision - a real double edged sword.
CNE's a good company, but I'm under water and looking to exit so as to reduce my O&G portfolio. A chunky award (if paid) should let me do that.
PS Glad I made you smile at least!

Malcy's take. Although perhaps we're realistically talking only a couple of months ie September for the ruling? It's big money, but there's still all the issues of compliance/enforcement even if there's a decent award. How might Covid affect India's approach to paying up? They've been hit hard by Covid and will be cash strapped, but then again they'll be even keener to encourage foreign investment as a result, and won't want to be seen to be mistreating foreign investors/making India seem uninvestable by ignoring the Tribunal and refusing to pay CNE. First things first perhaps - let's see if there's actually an award to talk about.

https://www.malcysblog.com/2020/07/oil-price-chariot-deltic-cairn-and-finally/

https://www.proactiveinvestors.co.uk/companies/news/924328/silence-therapeutics-agrees-second-licensing-deal-potentially-worth-in-excess-of-us14bn-924328.html

De facto bid's been north of 25p for a few days. Much harder to buy than sell. MMs trying to accumulate.

Good post Teela
I'm not well researched here, but this was Evil's piece from 1 June fwiw which sketched a "valuation" of the legacy assets, and is the only attempt I've seen. I'm minded to hold for the time being.

https://masterinvestor.co.uk/evil-diaries/evil-knievil-sympathy-for-the-devil/?mc_cid=7d48b8f5f1&mc_eid=340be254f4