Happy Days

fire in the middle of the city during night time

Our resolve can wear down a lot after a couple of months of being hammered in the market. Choppy action for months can be harder than a steady grind down. You get your hopes up that the sector is decoupling from the general market just to get the rug pulled out from under you. 

It is hard to see that equity prices go towards, or below, prices the equities were at a year ago. Getting closer, or below, your entry price is even worse. When you are up by a lot you are playing with the house money. It does not give that much consolation that commodity stocks are performing a lot better than the overvalued tech stocks or the other overvalued sectors. The only thing that matters is that we do not lose money. If you give it all back, you get angry at yourself that you did not take some of it off the table. 

Still, keeping things in perspective is very important. Yes, a recession, or a several year long depression is a possibility. In that case a lot of wealth will be wiped out in the world, but we will still need food and energy to survive. I do not believe that uranium and other essential commodities will fall as much as many of the speculative options out there. (We do however see the uranium sector has outsized beta to the up- and downside again and again). If they do, I believe they will bounce quicker. Why? Because they are essential for our way of living. Most of the speculative cryptocurrencies and tech companies (with unproven business models) can not proclaim the same place in the Maslow hierarchy. Well funded companies with great management in a sector essential for the world energy supply will survive. Compared to other investments many commodities have few to no substitutes, and many of them also have very inelastic price demand. Demand can go down a certain amount during a recession, but if the commodity already is in a major supply deficit, there is a bigger margin of safety  compared to other investments. You still have to pick the right companies. (Picking the wrong one, who has to do a capital raise at the worst possible time, can be the difference between bad and spectacular returns). 

With hindsight on the last couple of years, I would maybe have been a little less aggressive and been more patient with putting on my positions. Lobo Tiggre, the Independent Speculator, is someone I want to emulate more. The markets have time and again given us great buying opportunities. I am however not changing my overall strategy. As with diets or fitness programs, the best strategy is the one you are able to follow. What helps a lot for me is having a job with a cash flow coming in every month. I have diversified some of my new funds into the oil sector, but I am still buying uranium. If we continue lower, I will have some money ready to take advantage of it.

Getting on the offensive

MGM Studios, Inc.

One of my older posts “The Big Commodity Short” has been shared this week. I think that most of it is still on point. If I could have made one change for my own part, I might have invested more in the oil and gas sector that has been on a tear the last year. Still, I think that I also may have dodged a bullet. The cheapest and most undervalued oil and gas equities were in Russia. When I wrote this piece we knew that rising commodity prices would lead to higher prices on other products. That this again would put pressure on the central bank banks to curb runaway prices was a given.The question is still if the central banks will continue to increase rates and cause a major recession.

One should not be in the situation where you doubt the thesis every time the market is going down. The markets do not move up or down in a straight line. I see proof almost every week that the thesis is unfolding:

On Thursday June 16th Borja (@piterloskot82) reported that CGN (China General Nuclear) and CGNPC (China General Nuclear Power Corporation) have entered into a new sales framework agreement for three years between 2023 and 2025 for 3.12 million pounds per year. The interesting part was that 40% of the contract was fixed at $61.78/lb multiplied by an inflation multiplier, but the majority (60%) of the contract was linked to the spot price:


I have two takeaways from this contract: The first one is that the fixed part of the contract is way higher than the spot price at the moment ($61.78/lb versus $46.98/lb). The second part is that CGN has the majority of the contract linked to the spot price at the future delivery date. CGN would not have 60% linked to the spot price if they did not think it would be a lot higher than $61.78 during the contract period 2023-2025.

We also got the news that Global Atomic has received a Letter of Intent from a major North American utility to produce 2.1 million pounds of uranium from 2025 to 2030. Utilities are looking for pounds outside the major producers with developers to diversify supply. (Previously we have seen companies like Encore Energy contracting pounds for delivery in 2023). We did not see a lot of this before 2021. Focusing on just the general markets and the spot price of uranium going down (while SPUT is getting stink bids filled) becomes very myopic with this backdrop.

The challenge now is to get on the offensive. When looking back at the time we are now five years in the future, what do you think will be the best decision you can make today? Do you believe this is a buying opportunity or should we abandon ship and wait for better times? I am looking for more cash to deploy more steadily, but I will try to be a bit patient the next couple of months.

Avoid spreading yourself too thin

close up shot of a bread with butter

I have invested in uranium, gold, silver, tin, oil, RRE, and copper. With several of the sectors seeing new highs, people (with or without credibility) calling for a top will increase. Conviction to hold on to a trade when people come with differing opinions can not be given, it has to be earned. Mentally and financially there is a limited number of sectors I can follow at once.

What has worked out for me has been to focus more on a select few sectors and let a lot of the other ones go by the wayside. By being very focused I have missed trades in coal and lithium where companies have gone up several times their value the last year. In both of these sectors I was told in advance, and could have deployed some funds, but I decided not to spread myself too thin. Maybe some people are able to jump from the best performing sector every six months and catch all the trains, but I do not. I stay in a select few and wait until I have that big opportunity. There are just too many opportunities for me to take advantage of all of them.

Learning from previous mistakes

When I was younger I was well diversified with my investments. Among others, I was invested in the fish farming sector, which is very important in Norway. I was in this trade from early 2014 to mid 2016. Here I was invested into one of the most quality names in the sector (Salmar) who was executing on their strategy without fail. Salmon was a growing industry, and had been a great sector for several years already, when I started investing. I had an OK entry at NOK 76 (about $10-11 at the time), but I had nothing but random newspaper headlines and maybe some price charts to guide me. My investment in the fish farming business was just one among several different positions. Being invested in a lot of different companies and sectors had left me with too little time for in depth research. (If you seek diversification it is easier to have a broad index fund do that for you and focus on select areas for yourself).

There were a thousand reasons to sell. The most prevalent was, according to the financial newspapers, that the price of farmed salmon was unsustainable. People would not go on with paying an increasing amount for salmon. After a certain price point, people would switch to other protein alternatives. All this together with the fear of giving back the returns caused me to sell. I got out at a price of NOK 236 (about $28 at the time) mid 2016 for a 3x return in my home currency. With hindsight I do not look at the chart that continued on to a 9.5x return (excluding very generous dividends on the way) with regret. I do however take some lessons from it.


By knowing the sector more thoroughly, by knowing the dynamics and having a knowledge of the different milestones one should look for, you take out a lot of the guesswork in the trade. There are people who are experts in the fish farming sector and who have harvested a lot more gains from this trade than me. 

For my part, I find several of the commodity sectors to be a lot less complex than the fish farming business. There is no good substitute for tin when it comes to solder, if you are a nuclear plant you can’t switch from uranium to oil to fuel the plant etc. The commodities are also more cyclical than most other sectors where you go from a market that is oversupplied to undersupplied. Supply also takes a very long time to reach the market. For speculators this cyclicality is a feature, not a bug. The less developed a market is the more potential there is for outsized gains.

Can you feel it?

people at concert

After a break I am back at it again writing about uranium. This week there have been several exciting developments and I will mention a couple of them today. We have had news about possible restarts of idled mines by Paladin and Boss Energy. We had the month end reporting from UxC and TradeTech showing increasing prices in the nuclear fuel cycle. In addition a merger has been announced between Deep Yellow and Vimy Resources. These developments have me very optimistic for the times ahead.

I have tried to get away from following the sector closely every day for the last month. I have done this to try to become more objective and see if the news flow actually is as positive for the uranium sector as people are claiming. A lot of the news flow is noise, but getting back at it, a lot of the recent developments are material improvements and not just part of the hype.

Langer Heinrich and Honeymoon Uranium Mine getting closer to a restart

Late this week we had Paladin Energy announce that they had successfully completed an institutional placement to raise approximately A$200 million. The raise will mainly be used to restart their Langer Heinrich Mine.

A formal restart project launch is expected in July 2022. The commencement of early works activities will commence immediately. The Company is targeting commercial uranium production from Langer Heinrich in CY2024 4/4

I have seen comments that their market capitalization today is equal to what they can expect from producing and selling their supply at $60/lb. One counter argument to this is that the financing for A$200 has been done with bigger funds and institutions that demand returns on their investment with the company. That means demanding that Paladin be smart with their contracting. They have agreed to fund the company on a better outlook and strategy than contracting out the mine at $60/lb. 

Boss Energy is also set for a final investment decision on their Honeymoon Uranium Mine. They completed a Front-end engineering study that found costs, technical performance and financial returns to be in line with their 2021 feasibility study forecasts. A formal announcement of a mine restart is therefore likely not that far away.

My take is that Paladin and Boss are not moving their projects along without them seeing increased interest from utilities. Both companies have talked about being approached by utilities to start up production earlier. These moves are only made when they are confident that we will see sustainable higher prices in the future.

Things are moving along in the fuel cycle

Retail investors can at times be too focused on the spot market. We should however not forget about other parts of the fuel cycle. I have to credit John Quakes (@quakes99) for sharing these figures with the changes in price month over month from UxC and TradeTech. (Both companies provide information to the nuclear sector about uranium prices and more).

No doubt, a lot of the movement in the rest of the fuel cycle is because the situation with Russia. According to WNA, Russia provides about 35% of the enriched uranium globally. Possible sanctions are making fuel buyers looking for other suppliers. John Quakes has also shared this picture to show where in the fuel cycle we find U308, conversion, UF6 and enrichment.

If you see the spot price move down US$0.50lb in the future, it is good to not lose sight of the rest of the cycle. This development is clearly telling us that there is an increased focus on security of supply for the nuclear utilities.

Merger between Vimy Resources and Deep Yellow

John Borshoff from Deep Yellow has on several occasions said that not every uranium developer has a team that can build (or run) a mine. There is not enough know-how in the sector for every company being able to bring a project into production.

We might have seen an example of this with the merger of Vimy Resources and Deep Yellow. If Vimy was capable of building the Mulga Rock Mine by themselves they would not have agreed to the merger with Deep Yellow that easily. Based on their feasibility study, Vimy Resources is one of the more leveraged companies in the sector on a discounted cash flow basis from their projections. Still, the feasibility study is made with the assumption that they will get into production. A lot easier said than done. 

You don’t necessarily have to build the mine yourself to add value to a project. If you have done a great job by derisking the property, you can see great valuations on the asset alone, without getting into production during a buyout from a producer or competitor.

The new merged company is very exciting in terms of the size of their combined resources. With the correct strategy for getting into production the new company has potential to become one of the winners in this bull market.


After a lot of turbulence in the start of 2022 it looks like most of the news coming out at the moment is positive for the sector long term. With Paladin and Boss Energy getting closer to restarting their mines there is a noticeable optimism for the future in the sector. I am not going to speculate on timeframes and price targets for the spot price, but from what we have been seeing the last year my view is that we are probably going to see a move sooner rather than later. The peak price of uranium will also most likely be a lot higher than what you could hope for when I entered the trade in 2019. 

To end this post I just want to remind myself and others that anything can happen. Do not invest more than you can afford to lose.

Security of supply

wood landscape water mountain

Before today’s post I have to acknowledge the situation in Ukraine. I am against war and invasion of any country. I am not cheering what is happening, and I do not talk about nuclear war in an offhand way. All of my positions were set long before any talks about Ukraine and I am not trying to profit from war. Still, this conflict is making it obvious that security of supply is becoming more and more important. 

Even though few people had war on their calendar for 2022, some speculators have been positioned for scenarios that are similar to what we are seeing today. One of the biggest arguments for strengthening the US domestic uranium fuel cycle during the Section 232 hearing in 2019 was the West’s dependence on Russian, or Russian influenced supply, of critical commodities. It was not only fear mongering to further US producers/developers interests. A substantial part of the world’s enriched uranium is coming from Russia. Sanctions on Russian commodity exports will lead to utilities having to look for supply from elsewhere. This is a big part of the reason we are seeing the upturn in the uranium sector at the moment.

The spot market

On Friday 25. February SPUT moved up over 7% with very high volume. I was watching the follow through closely to see if the spot price would react. I invest, at least partly, in uranium because it is not an illiquid market. If a high volume day of SPUT buying had not moved the price of the trust into a premium to raise money, it would have been a big red flag for me. (Earlier in 2022 we had a Friday where over a million units of SPUT were traded in a couple of minutes, but there were no units issued. There was liquidity enough for this trade to happen without a premium to NAV. For me this was a bad sign that volume like that could be absorbed without a move in the market at all).

Luckily Friday 25 February did not go the same way. SPUT was able to issue 6.66 million trust units raising $83 million in cash to stack about 1.41M lbs of uranium. This led to a two dollar move higher in the spot price to $46.5. For me this is another confirmation in the uranium thesis.

I would like to remind everyone that we are at the “end of month smash” period for the spot price of uranium, where some players are usually trying to force down the price for their spot referenced contracts. With SPUT still at a premium and cashed up, there is at least for the moment a ready buyer for anyone who wants to sell off some pounds to lower the price.

Positive developments for uranium

city skyline across body of water during night time

This has been a very interesting week to say the least. Cameco delivered their Q4 2021 numbers, France announced plans to build up to 14 new nuclear reactors and the U.S. Department of Energy announced a $6 billion Civil Nuclear Credit program.  

On Wednesday 9. February we had Cameco reporting their Q4 2021 results. What got most people talking was the announcement that Cameco will start up production at McArthur River production again (although below the annual licensed capacity). Cameco has already communicated on several occasions that McArthur River will not start production before the pounds they are producing are under contract. I read some publications interpreting the call as negative, but I could not disagree more. Cameco has signed 70M lbs under contract since 2021, and 40M of them in 2022 alone. For all of 2020 Cameco signed 12.5 million pounds in long term contracts. Long term contracting finally looks like it is increasing, although from very low levels. It will be very exciting to follow the developments in the next couple of quarters.

Out of France we had President Emmanuel Macron saying that France will construct six nuclear reactors, and study the possibility of commissioning a further eight.

Macron said: “Given the electricity needs, the need to also anticipate the transition and the end of the existing fleet, which cannot be extended indefinitely, we are going to launch today a program of new nuclear reactors.”

Following this, on Friday 11. February, the U.S. Department of Energy announced a $6 billion Civil Nuclear Credit program.

The U.S. Department of Energy (DOE) today released a Notice of Intent (NOI) and Request for Information (RFI) on the implementation of the Bipartisan Infrastructure Law’s $6 billion Civil Nuclear Credit Program. The nuclear credit program supports the continued operation of U.S. nuclear reactors, the nation’s largest source of clean power. Both the NOI and RFI are critical first steps to help avoid premature retirements of nuclear reactors across the country, preserving thousands of good-paying clean energy jobs while avoiding carbon emissions. 


We have already seen several positive developments in other parts of the world. The US taking action is great.


With all the positive developments, and possibilities of high returns, it is important to remember to prepare for the best case and not just for the worst. I use anchoring actively at the moment to be at least prepared for this.

Anchoring is a behavioral finance term to describe an irrational bias towards an arbitrary benchmark figure.

We see several examples of this. In oil there is for example something magic about trading above $100 per barrel. We see similar price levels in many commodities. You also have anchoring used in sales. For example you have a used car salesman offering a very high price for a car at the beginning of negotiations well above its fair value. The high price acts like an anchor and often results in a price higher than if the salesman started at a fair value. Also, if you see a t-shirt selling at $1,200, the next one you see, even if it costs $100 will seem cheap in comparison.

There are also real life examples of anchoring. They can look very similar to the ones we have in investing. I had a running buddy that for years could not break the 2 minute barrier in the 800 meter race. This can be compared to a resistance level in a trading chart. (A price level a stock is not able to get over). However, when my running buddy finally got under 2 minutes, he was able to repeat this for several years in a row. Even if he got injured, got out of shape at times, he knew he had done it before and managed to do it again repeatedly because he had done it before. What was impossible before was possible, almost inevitably possible. Analogous to trading the 2 minute barrier had become what you could consider support in a stock chart.

With investing I’ve had a similar situation. When I first started out, the big round numbers were always far away impossibilities. However, after several years of investing I broke down several of these barriers on the way. At the November 2021 highs I was around an area I had found almost unattainable at the start of 2019. (And yes this was in hindsight a great area to take some profits off the table and buy back cheaper three months later). The benefit for me after the fact is that I broke a mental barrier by just holding on and getting to this level. Now I have an anchor at the valuation my portfolio had in November, and it does not look that imposing anymore. I am getting more used to that level, and I will not be as stressed by getting there again as I was three months ago.

When we talk about anchoring in psychology, we mostly consider it as a behavioral bias. There is absolutely no rule saying my portfolio has to go back to its November 2021 high. There are a million things that can happen to the market, and the world in general, that can stop a market in its tracks. (In addition, nothing says you have to get back to the same level the same way you got there the first time). As an investor I am aware of this. I am also aware that people self sabotage themselves at important inflection points in life, and in trading. People talk themselves out of doing stuff that would improve their life considerably every day, and many do not get to the next level because of this.

I am therefore using this anchoring consciously to avoid the worst of this. I have obviously invested in the natural resources markets because the fundamentals say that for production to increase, the price has to go up. I have a very strong conviction in this, and I have put most of my funds in on this bet, but there are no guarantees in life. If we get back to previous highs I will at least be ready for it. It is important to think about the worst case scenario, but you have to know what to do when you find yourself in the best case scenario.

Our performance is our responsibility

photography of person on green mountain

I am not making a full post for today. (I have a draft about the change in EU and US utilities contract coverage, but I think that can wait). I just want to come with a reminder that if you invest in a volatile sector you are responsible for your own results.

I had not checked my portfolio performance before today. Watching the value of a portfolio going up or down in real time is very different from seeing it after the fact. If you see something in real time, you are often tempted to do something about it. That is not always the best decision. When I checked today I saw it was about 33% down from the November highs. (I have used URNM as an illustration for the general uranium sector).

URNM on stockcharts

I do however own the decisions made since November. The initial strategy has been to add every month and stomach the volatility. 

Right before the November high, the value of my portfolio was high enough for me to exit the trade and be happy with the results. That meant that I would break my initial strategy. Something I only want to do if the thesis changes. I decided to stick to my initial strategy, and by doing that, I accepted responsibility for all of my results today. My results are not dependent on decisions outsourced to other people. My portfolio being down 33% is something I can live with.

The developments we are seeing now in the general stock market is in the top three bear case-scenarios for my portfolio. (The general stock market is turning over and is dependent on FED intervention). If the cavalry does not come to the rescue, the general stock market will continue down, and few know where we will end up in the end. Commodity equities are still equities and follow the general market. (There are a lot more nuances here, but nuances are not the topic for today).

What you think will be the FED response to this development will decide how you invest going forward. The range is wide. From going 100% to cash to going all in. The only thing I know is that the next couple of weeks will be interesting…

Theodor Kittelsen 

It will not be like the last time

silhouette of trees under starry night

When most people talk about a repeat of the last bull market in uranium, they are thinking in terms of expected returns. One of the biggest deciding factors for expected returns is the valuation of your investment at the time of entry. If the company you are investing in is pricing in a price of $200/lb for uranium, you might need an Elon Musk at the helm to get great returns.


Some veterans of the last bull market were waiting for uranium companies to fall to real liquidation levels in 2020 and 2021. I think there are two factors that made certain that we did not go there compared to the valuation of uranium companies in 2000.

First of all, during the early 2000s, retail did not have the same availability of tools like Youtube and social media to get to know about the uranium sector. There were message boards, but the uranium story did not get far outside that group. People who invested in the sector in 2000 had connections to the resource investment community, or had industry knowledge about the sector. This led to only a select number of investors buying into the sector and giving financing to the mining companies.

Now we have social media that have helped spread the message of the sector far and wide for years. Veteran, and new investors who have talked publicly about uranium, have led to a steady stream of new investors entering the sector, bidding up the companies. This has helped the uranium companies from dropping to valuations where speculators could find Paladin at the bottom of the last market. In companies where trading volumes are low, even small amounts can move the price and influence the valuations of companies.

Secondly, I think we probably could have seen a last big capitulation in 2020 or 2021, if we did not have Covid-19, which led to the closure of Cigar Lake and the disruptions in Kazakhstan. This led to increased buying in the spot market from producers like Cameco, which in turn led to the spot price going up. For the first time in years we saw the sentiment shift.


The spot price going up above $33 in April 2020, up $6 from March 2020, was enough for companies being able to raise money at considerably better terms in the second half of 2020 than the first.

Know what you want to get out of the market

Valuation is key when it comes to expected returns. We are not in the first inning anymore. A stock that has gone up 100%, all else being equal, is half as attractive. A bull run like the early 2000 is also very rare, and is not something we should count on. I think we will see a very strong uranium market going forward, with returns at multiples from the valuations we see today. Inflation, secondary demand from financial players like SPUT, an actual supply deficit (and not just a hypothetical one in the future), are just a few factors that make me very optimistic.


It might not look like it, but not everyone invested in the sector is looking for Paladin returns. Going from $0.1 to $10 where an investment of $10,000 can go to $990,000 is not what most people are aiming for. Personally, I have invested so that I will be happy with a 10X for the average holding in my portfolio. (The equivalent of holding Paladin from $0.1 to $1.0). It is important not to be a victim of the monkey trap. Following a strategy for scaling out your positions is key.

It is important to note that my strategy is based on the fact that most of my positions were set during 2019 and 2020. With later positioning I would not aim for the same returns. I do not need a bull market like the last one to be happy. For every investor in the sector it is important to know in advance what returns you will be happy with.

Why do I still own gold and silver?

white and gray bird on the bag of brown and black pig swimming on the beach during daytime

The majority of my articles are about uranium. My second biggest position is, even if I do not write a lot about it, in physical precious metals and the miners. Owning precious metals after August 2020 has been frustrating to say the least. Why do I still hold these positions when they are underperforming?

To defend an allocation to the physical gold and silver positions, we have to understand that all investments are not for maximizing the upside. Our allocation to physical should be considered more of an insurance. Something you only want for protection against a negative event like a currency devaluation. (The situation in Venezuela comes to mind). Investments in the miners are more for speculation and participating in the upside.

Inflation protection

Many people own precious metals as a hedge against inflation. In that environment, veteran investors will be quick to tell you that investments in energy and other commodities perform even better than precious metals. (A good reason to hold uranium, oil and other commodities).

The other benefit you get by owning precious metals is for diversification, and that it still performs in a deflationary environment. Let us compare the S&P 500 to the performance of gold during the financial crisis of 2008.

Gold during the 2008 Financial Crisis

During the 2008 financial crisis the stock market fell by more than 50% after the housing bubble popped.

From the top og $1549 in October 2007 it took about 16 months before the S&P 500 bottomed out at $735 in February 2009, down 52,5% from the 2007 top. From there, it would take another 49 months before the S&P 500 got back to break even in March 2013. In total, the S&P 500 spent more than 5 years underwater before it managed to get back above its 2007 highs.

The price of gold during the same time told a completely different story. From the S&P 500 top in October 2007, to the bottom in February 2007, gold went up 27%. By the time the S&P 500 was back at break even in March 2013, gold had gone up by more than 120%.

This is not an example to show how much you could have made if you rode the gold bull market perfectly. This is how part of your portfolio could have performed (not inflation adjusted) during the time of the financial crisis if you were diversified into physical gold. Owning an asset that protects you like this can make a big difference if you want to protect your wealth.

Caveat – Gold stocks are still stocks

It is important to emphasize that physical gold performed well as a hedge, not gold mining stocks. The gold stocks performed very similarly to the general stock market, they just fell even more. (On the positive side, they bottomed out and got back to break even earlier than the general market). Gold stocks were not a good hedge during the financial crisis.

What I am doing

Markets do not move when we want them to. I have a position in physical gold and silver for protection, and in the miners for upside. (I look to add to this, and to my cash position in 2022). Many talk about scaling out of some of their commodity positions, and into gold and silver miners later. I do not know if the market will be there for them when that time comes. I therefore have some exposure to gold and silver at all times. 

My portfolio is a mix of physical and Sprott’s gold or silver trusts. In addition I own some miners. For miners the big ETFs are where most of the funds have gone. I also have some select companies who have jockeys with a track record for making money for their shareholders. (Rick Rule has mentioned some of these jockeys in earlier interviews). Like everything else, you can get these companies at reasonable valuations if you buy them during weakness in the market.

Uranium looking at 2022

person taking photo in sunset

Happy New Year to everyone. 2021 is behind us, and we have 2022 ahead of us. Today I will mention the three biggest positive triggers I am looking at in the uranium sector in the coming year. I hope that 2022 will be a great year for us all.

Long-term contracts

We have heard of some contracts being signed in 2021. I expect we will see even more of this activity in 2022.

“a reactor that runs out of uranium is just an expensive paperweight.”


There is no substitute for uranium. We are now one year closer to the years 2024 to 2026 where a lot of contracts roll off.

I used the above graph a lot last year, and I hope we will see a 2022 version of it.

Companies like Kazatomprom and Cameco need communication from their customers if they are to increase their production after 2023. Producers increasing production will however not be enough. New mines need to come online to cover demand at the end of the decade. There are some developers aiming to get in production after 2025, but you only want part of your supply coming from an unproven entity.

EU green taxonomy

It looks more and more like we will get nuclear power (and gas) included in the green taxonomy. A draft for the taxonomy text was sent just minutes before central Europe went into the new year and 2022. There are still possibilities for delays with the EU bureaucracy, but getting a draft out before 2022 leaves me hopeful.  

Getting access to financing at more favorable terms, and access to a bigger pool of investment groups can do a lot for the build out of more nuclear reactors. The sector has had several regulatory disadvantages that have made construction of nuclear plants very slow and costly compared to other alternatives. Just changing this slightly can be very positive for the future of nuclear power in the European Union. Before 2021 this was not on our radar so this change is already very positive.

SPUT NYSE listing

The last factor I am looking at is the listing of Sprott Physical Uranium Trust on the New York Stock Exchange. With an investment pool that is about 10x the size of the Toronto Stock Exchange, ($28T vs $3T) this can have a very big impact.  If we get interest from big financial players, we might see a price where more of the above ground inventory moves into Sprotts hands. Mobile inventories of uranium being sold into the market, and Kazatomprom flooding the market with cheap pounds, are two of the most popular bear arguments for the sector. The more answers we get to these arguments, the better it is for investors.


These are the three things I am looking at in 2022. If you have other ones just leave a comment here or on Twitter.

Can nuclear get a Messmer moment in 2022?

snow covered mountain during sunrise

We are at the moment looking at a future with nuclear power growing in the western countries for the first time in decades. With growth in the sector mainly being designated to the East so far, this is not something to scoff at. On Wednesday 22 December we will probably get a decision if nuclear power will be included in the green taxonomy. This will open up the possibility for cheaper financing and make it much easier for many funds to invest in the sector. The coming week is therefore a very exciting one.

This comes at a time where people in Europe have to deal with high energy prices, and an uncertainty about availability of energy in the coming months. As with almost everything, we have experienced similar situations before.

Looking to history

Certain things seem to repeat from time to time. In the 70s we had an energy crisis that showed the world how dependent we were on oil for our energy needs to keep society running.

«The oil crisis arose in the western countries in the winter of 1973–1974. The price of petroleum increased when production was reduced, which led to austerity measures and restrictions on, among other things, driving. The background to the crisis was the war between Israel and Egypt/Syria, called the Yom Kippur War.

The member countries of OPEC, decided to raise crude oil prices by 70 percent, from $3 to $5.11 per barrel, and to cut production by five percent for each of the following months until Israel withdrew from the occupied territories.

​​On January 1, 1974, OPEC raised prices to $ 11.65 a barrel».

(Translated and abbreviated from the Great Norwegian Encyclopedia).

We also had a drop in oil production in the wake of the Iranian Revolution in 1979, known as the 1979 Oil Shock, or Second Oil Crisis that pushed the price of oil even higher.

You have probably seen pictures of the 70s with lines at the gas stations, and similar situations. In Norway there was a ban on driving cars during the weekend for a time. (One of the most famous pictures from 1973 was of the Norwegian King Olav V, taking the tram together with the regular citizens to go skiing. It was mainly a publicity stunt, but this helped solidify his reputation as “The King of the People”).

The oil crisis led to many trying to find solutions to be less dependent on oil. Necessity is the mother of invention. Just as people managed during World War II with rationing, with most goods in short supply, many people came up with ingenious solutions. As an example we had people driving cars that ran on coal, or even wood.

You also had solutions being made on the national level. Many of the 56 nuclear reactors in France were built following the 1973 oil crisis. In March 1974, the French Prime Minister Pierre Messmer announced what later became known as the “Messmer Plan”. This was a huge program aimed at generating all of France’s electricity from nuclear power. (At the time of the oil crisis France was dependent on a lot of foreign oil for their energy needs). France looked to nuclear power as a solution to this dependency.

At the moment we look to be just as dependent on oil and gas as we were in the 70s. The last decade we have scaled up intermittent renewables, and made them a bigger part of the energy mix, and at the same time underinvested in the fossil sector. The underinvestment in fossil fuels has led to lower supply available, and higher prices.

We’ve already had heads of state like Macron and Johnson coming with announcements about renewed investments in nuclear power in France and the UK respectively. Several other western countries have done the same. With the possibility of a colder winter than usual, and supply lines stretched already, we might get more countries on board with nuclear power. One winter similar to 1973 and we might get another, if not a Messmer moment, maybe a reversal of the opposition to nuclear power from other countries.