Investor, modern energy expert and author of ‘My Electrician Drives a Porsche?’, Gianni Kovacevic cautions investors looking to uranium. Mr Kovacevic, speaking ahead of his appearance at Mines and Money Asia in Hong Kong this April, said it is becoming more and more difficult to see serious long-term demand for the commodity.
“There are 447 nuclear reactors and investors are always told about the 60 reactors under construction and the some-200 that are ‘proposed’ and ‘planned’,” he said.
“What they usually fail to mention, are the 300 reactors, of the 447, that are more than 30 years old. Or, the 85 reactors in the USA that were extended, again, to 2034 as the cost to shut them down is so punitive.
“India derives 2.1 percent of its electricity from nuclear and China about three percent. The facts have changed, and they are taking an all options approach, and that is looking less and less like nuclear as the big growth pillar even if they do some construction” he said. “That being said, we do need to produce uranium and if the producers of note keep that balance, there should be a margin for that product, because nobody in that business makes money at $25/lb Uranium.”
Looking toward other commodities for investment, Mr Kovacevic stated that the future of all ground transportation is going to increasingly be electrified; cars, trucks, delivery vehicles, car sharing, taxis, buses and even more railroads are moving from diesel to electric.
Mr Kovacevic said that lithium cobalt and graphite have become buzzword commodities but we need to see how they tolerate new battery chemistries, substitution, and over-supply. The only clear winner being created by the electro-mobility shift is copper.
“I will suggest copper has the most new demand growth of any of the major commodities; perhaps as much as 50 percent new demand to 2040.
“There are only 25 copper mines that provide 50 percent of primary copper production, most passive investors are not aware of these.
“So how can the world’s copper producers provide 10 million tonnes of new annual demand? A much higher copper price is the only way,” he stated.
Mr Kovacevic is very excited about the Los Helados and Josemaria Projects owned by NGEX Resources as well as Filo Mining’s Project. “The area has some 100 million ounces of gold and is pushing close to 100 billion pounds of copper. These are huge numbers.”
Gianni Kovacevic will be scrutinising the modern energy pivot and discussing the winners and losers at the upcoming Mines and Money Asia conference in Hong Kong from 3-6 April.
Now in its 11th year, Mines and Money Asia is the largest gathering of miners and investors in Asia, with this year’s event expecting to see more than 150 mining companies in attendance along with more than 600 investors.
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