IT'S time for serious investors to get back into the uranium sector. Clients of Warwick Grigor's Far East Capital will today receive a 30-page report that flashes this big news and provides a form guide to a very big field.
Grigor says the bubble burst after the uranium price reached a "crazy" $US135 a pound but has now stabilised around $US90/lb. Demand will be underpinned by a British Government announcement last week that new nuclear power stations are on its agenda.
Uranium sank into a bear market last year, but they are still energy stocks and it is time for investors to price them with that in mind, Grigor argues.
Of the contenders, Grigor sees Alliance Resources as one of the lowest risks in uranium. Its deposit is in South Australia (no political risk) and the grade is "wonderfully high, guaranteeing huge profit margins".
Then there's Contact Uranium with its Corachapi project in Peru. The report says the numbers on a heap leach operation there look "stunning" and suggest the shares are cheap. Curnamona Energy is given the nod as a genuine uranium explorer.
Grigor is a little worried about Labor in Canberra. "It is hard to see the federal Labor Party making development of mines any easier, especially with Peter Garrett involved," he says.
Meanwhile, two items worth noting are Uranium Exploration Australia, which has reported surface uranium near the high-grade Bigrlyi find in the NT, and Nimrodel Resources, which says it has received permission from the Kyrgyz Government to investigate 23 tailings deposits left over from Soviet uranium mining between 1946 and 1968.
