Oman. Which agreed to invest up to $120 million to fund a uranium development project in Spain — and potentially take a significant chunk of the uranium supply from the operation.
The Oman fund said it will make the investment as a combination of debt and equity in project developer Berkeley Energy. Which is advancing the Salamanca project, currently under construction and expected to begin output in 2019.
The move is a big one for the Oman government. Representing the first entry by this major investment group into the uranium sector.
Crispin Odey is preparing for inflation with a new fund
In a presentation for the Odey Inflation Fund, which was reviewed by ValueWalk, Crispin Odey's team made a case for how to protect yourself from inflation and discussed why gold isn't the best protection and how important it is to prepare for inflation in your portfolio. Q3 2020 hedge fund letters, conferences and more Protecting Read More
And the timing isn’t a coincidence. With Oman’s first nuclear plant slated to come online next year — supplying baseload power to the nation.
That appears to be a major motivation for this week’s investment. With the Oman government also securing rights to uranium offtake from the Salamanca mine as part of the deal.
All of which is a major sign of life for the uranium market. Showing that end-use demand in the nuclear sector is staying strong as new reactors come online globally.
The investment also shows that uranium consumers are thinking down the road in securing supply . Which could prompt more deals like this one, as buyers watch future supply being tied up by offtake agreements.
The Oman deal will also be an interesting test case on uranium trade policy. With the offtake agreement requiring approval from European nuclear agency Euratom.
Watch to see how the regulator will react to the idea of uranium exports to the Middle East. And to see if this investment will spur more activity across the uranium space.
Here’s to buying in,
Article by Pierce Points