Investors ramped up bets on uranium after the US Government unveiled a $121.4 billion ($US80 billion) plan to build nuclear reactors, sending Australian stocks higher.
The US Government announced plans to purchase the reactors from Westinghouse Electric to meet surging electricity demand from data centres powering artificial intelligence (AI).
The announcement sent shockwaves through markets, with ASX-listed uranium companies seeing strong gains. Boss Energy rallied over 13 per cent in the past five days after reporting a record quarterly production at its Honeymoon project, while Paladin Energy jumped more than five per cent in the past day.
“This was another strong quarter from the Honeymoon operation with record production of 385,910 pounds of uranium [U3O8] at a C1 cash cost of $34 per pound,” Boss Energy managing director Matthew Dusci said.
“Cash margins were strong, with sales and loan repayments of 500,000 pounds U3O8 at a realised price of $US74.7 per pound generating an additional $11.2million in net cash.”
Boss Energy is in a strong financial position with cash of $47.8 million and combined liquid assets of $212.4 million – including 1.44 million pounds of uranium held as inventory.
“Significant progress was made in the quarter on advancing a number of work programs, including the commencement of a significant resource delineation drilling program at Honeymoon to improve our understanding of the resource,” Dusci said.
“We have also established a team to conduct the permitting and technical studies for the satellite deposits of Gould’s Dam and Jason’s deposit.”
The scale of the US deal took markets by surprise, sending the spot price of uranium up six per cent to around $US81.50 a pound, and was sitting at $US82.15 at last close.
Momentum is being driven by hyperscalers like Google, Microsoft, and Amazon, which are investing in nuclear power to meet AI-driven electricity demand.
With uranium companies like Boss Energy and Paladin benefiting from production growth and strong market tailwinds, the sector is emerging as an up and coming commodity this year.
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