Investors race to lock down uranium supplies for advanced nuclear
Investment and merger activity in the uranium mining sector exploded in 2022, triggered by renewed concerns around energy security.
Why it matters: Investors are rushing to secure critical raw materials — especially for a new generation of advanced reactors.
What's happening: Global investment in uranium mining leaped past $1 billion last year, a 5x jump from 2021, per PitchBook data.
State of play: Deep Yellow acquired Vimy Resources for about $492 million in August.
- Uranium Energy Corporation bought UEX for around $182 million, also in August.
- Encore Energy and Uranium Energy Corporation purchased several projects last year.
Driving the news: The flurry of activity traces to Russia's invasion of Ukraine last February.
- Russia was a top producer and processor of uranium. International sanctions upended that supply chain.
- Similar sanctions on Russian natural gas exports, meanwhile, sent energy prices to the stratosphere, particularly in Europe — stoking renewed interest in nuclear energy generation.
Meanwhile: The Department of Energy and Congress took steps to spur investment in U.S. uranium production and nuclear energy.
- Nuclear is an unusually capital-intensive sector with long timelines. The federal funding and incentives were crucial to last year's deal-making.
Be smart: Russia's invasion was especially vexing for startups developing new nuclear reactors.
- Russia was the only large-scale supplier of what's known as HALEU, a type of enriched uranium for advanced reactors being developed by companies such as TerraPower and X-energy.
- TerraPower announced last month that it would have to delay its project timeline by at least two years due to the new supply chain challenges.
- With sanctions in place, investors and companies are rushing to build alternative sources of supply — with support from the DOE.
Bottom line: "Private capital for nuclear is being driven by bipartisan support for different policies to enable different next-generation technologies and current technologies," Niko McMurray, managing director of public policy at ClearPath, a D.C.-based nonprofit that advocates for nuclear energy, tells Axios.