Cherry Picking the Best Uranium Properties on the Cusp of the Next Commodity Boom

International Consolidated Uranium

Historically, consolidating sectors in bear markets is an excellent plan.

But few companies achieve it, because they have no cash at the bottom of the market. The team at Lumina Copper, led by Ross Beatty, was notably the best.

It acquired several copper projects in the early 2000’s for about $175 million. And by 2005 it split itself into four companies. The total return of those projects was over $1.5 billion to shareholders.

From 2002 to 2008, copper soared 500%.

As you can imagine, with that kind of tailwind high quality copper projects soared in value, taking stock prices with it.

Today, there’s a new analogue — and company — to that copper opportunity: uranium.

From January 2005 to December 2006, Mega Uranium followed this model of consolidating assets. It raised C$50 million and acquired nine projects. Its market cap went from C$15 million to C$940 million — a 25X increase.

Several other uranium companies, like Paladin, Energy Metals, and Uranium One had success with this model as well.

We fully expect uranium prices to stage something similar to the copper rally in 2002.

And there is an excellent junior that plans to follow the model in that commodity.

International Consolidated Uranium (TSX-V: CUR)(OTC: LBHRF) took a page from Lumina Copper’s playbook. They’ve collected a fantastic uranium portfolio that they can sell at a profit for the next decade.

Here’s why…

Alternative Energy is Great Until It Doesn’t Work

Coal is all but dead. And filling its gap in electric power will create huge opportunities for investors.

For the past 100 years, coal-fired power plants supplied a critical part of the world’s electricity. These plants never shut down. They just percolated in the background and generated power 24 hours a day.

That’s called “base-load” power. Without it, you end up with brownouts or full outages.

As governments around the world closed those coal plants, they replaced them with alternative power like wind and solar.

Those sources don’t supply base-load power. So, the frequency of weather-related outages jumped.

It happened to England in June 2018, when the winds dropped to nothing for two weeks. At the time, the country only got 4% of its power from wind turbines. But that loss drove power prices to decade highs…because they didn’t have enough.

During ideal conditions, those wind turbines can produce the electrical power equal to twelve nuclear power plants. But not when it’s calm.

It happened again in November 2020. Calm weather created a problem for the grid. It fell 1.5% short of demand. As noted by Ellen Wald in her essay in Forbes:

National Grid was forecasting a shortfall of 740 MW (1.5%) in the extra power plant capacity it needs to have available at all times to meet demand or pick up slack in the event a power plant breaks down. It is important to note that this happened at the beginning of November, not in the heat of summer when air conditioning can strain grids or an abnormally long cold snap in the winter. No, this was not caused by overburdening the grid but by overreliance on unreliable alternative energies.

It happened again in the U.S. over Valentine’s day weekend in 2021. A huge blizzard froze wind turbines across the state of Texas. Two million customers lost power.

It stretched the state’s power grid so badly that customers who didn’t lose power faced rolling blackouts for the first time in a decade.

Utilities cut 10.5 gigawatts of power demand to ease strain on the power grid throughout the state.

I expect these events to begin a nuclear power renaissance around the world.

Power outages aren’t acceptable in today’s online world.

Wind, solar and hydro power are all great. But they each have a significant flaw… calm, night, and drought respectively. As a society, we need power all the time, not just when conditions are good.

This is one of the biggest problems for carbon-free power sources. If you rely only on wind and solar, you will fall short at times. The clients end up paying more for the power and it can damage the power grid.

Renewables are going to be a large part of the future to be sure. But they need a baseload counterpart… an energy source that can stay on all the time.

Fortunately, there is a carbon-free answer: new nuclear power plants.

According to the International Atomic Energy Agency (IAEA), countries around the world understand that. The IAEA data show fifty new reactors under construction in nineteen countries…including two in England.

However, there’s a problem with fuel for those new reactors. The uranium price cratered in 2011, after the Fukushima Daiichi disaster in Japan. An earthquake followed by a tsunami devastated a nuclear power plant there.

As you can see, the price of a pound of uranium fell about 75% from 2011 to 2017, before starting to recover.

That collapse created many orphaned uranium projects.

But it left many excellent projects selling for just pennies on the dollar. That’s where International Consolidated Uranium (TSX-V: CUR)(OTC: LBHRF) took advantage of a huge opportunity.

For speculators, the important thing to keep in mind is that the uranium sector is highly cyclical in nature. And while it’s true we haven’t really seen a major resurgence since post-Fukushima-2011, the annual supply-demand gap — which currently stands at 20 million pounds U3O8 — points to a highly bullish scenario for uranium prices going forward.

What we’re looking for next is for the major US utilities to come in and start purchasing U3O8 contracts at higher uranium prices — signaling the start of what many experts believe will be a swift and sustainable uranium price move from the current $30/lb range to $50/lb and perhaps even higher.

Once that happens, those select few well-positioned uranium juniors like International Consolidated Uranium could see their respective share values rise in dramatic fashion.

The key is owning select top-quality names before U3O8 prices heat up — just like what we witnessed in mid-2007 with uranium rocketing to $135 per pound and bringing the vast majority of North American uranium companies along for the ride.

International Consolidated Uranium (TSX-V: CUR)(OTC: LBHRF) Using a Proven Method in a Beat Down Sector

International Consolidated Uranium is a C$39 million market cap junior mining company.

It has a tight share structure (47.1 million fully diluted). And it has a solid C$10.3 million cash position (as of January 2021).

Two important uranium companies, Mega Uranium and IsoEnergy own 4.2% and 3.0% of its shares, respectively. Management and insiders own another 5%. Institutions like Sachem Cove and Segra Capital own another 36%.

This junior packs a big punch in leadership. Its founders are the same team behind NexGen Energy (NYSE: NXE) and Mega Uranium (TSX: MGA). NexGen is a $1.5 billion uranium company.

International Consolidated Uranium holds five uranium projects around the world, as you can see in the table below:

As you can see, the company doesn’t have a bunch of moose pasture. It has real assets holding real metal.

In May 2022, it acquired 100% of the high-grade Matoush Uranium Project located in Quebec, Canada. Matoush is considered an advanced-stage exploration project (413 mining claims; 217 sq km) with a substantial high-grade historic resource of:

586,000 tonnes Indicated at an average grade of 0.95% U3O8 containing 12.3 million lbs of U3O8

1,686,000 tonnes Inferred at an average grade of 0.44% U3O8 containing 16.44 million lbs of U3O8

International Consolidated Uranium CEO, Philip Williams – whom you’ll be hearing more from in just a second – commented via press release:

“We are very pleased to add another high-grade, advanced stage project, in a top ranked mining jurisdiction, to our global project portfolio. As with our other projects, Matoush was the subject of significant past exploration and economic evaluation work. It stands out for its high-grade and sizeable historical resource, ranking as one of the highest-grade undeveloped uranium projects outside of the Athabasca Basin in Saskatchewan as well as its promising exploration potential. We look forward to bringing a fresh perspective to development of the project with a focus on engagement with the local indigenous stakeholders before undertaking any project level activity. We recognize that uranium mining can be a lightning rod issue and, as such, it is incumbent on us to garner social acceptance before attempting to advance a project. Fortunately, uranium mining in Canada, under the strict regulation of the Canadian Nuclear Safety Commission, has an excellent track record with studies showing no significant impacts to the health of the public living near uranium mines or mills. Canada's long-standing experience in uranium mining has resulted in the development of stringent regulations and leading practices for the protection of health and safety of persons and the environment which, of course, we intend to adhere to fully.”

The Matoush acquisition adds to an already impressive property portfolio for International Consolidated Uranium.

The company is also the beneficiary of strong financial backing from Sachem Cove Partners and Segra Capital — perhaps the two best-known financial institutions in the worldwide uranium market.

Right now, indicators are pointing to a major resurgence in the global uranium market, which makes International Consolidated Uranium — with its impressive property portfolio and sub-C$75 million market cap — absolutely one-to-watch in the junior uranium space.

To learn more about this intriguing junior mining company, our own Gerardo Del Real sat down with the Chairman and CEO of International Consolidated Uranium, Phil Williams. You can read the transcript below.

International Consolidated Uranium (TSX-V: CUR)(OTC: LBHRF) CEO Phil Williams on Consolidating High-Potential Uranium Projects Around the Globe

International Consolidated (TSX-V: CUR)(OTC: LBHRF) Uranium Offers Lower Risk and Huge Upside

International Consolidated Uranium isn’t a grass roots exploration company. It has five advanced uranium projects that hold a significant amount of uranium and vanadium.

However, its market cap is so low, it’s a steal right now. On an enterprise value to resources (EV/resource) metric, you can buy International Consolidated Uranium for just C$0.68 per pound of uranium. That means you get all of the vanadium for free.

If we consider the vanadium, the cost drops to just C$0.37 per pound of metal…by far the cheapest resources in its peer group. The average EV/Resource is C$2.25 per pound. International Consolidated Uranium’s price needs to go up 500%, just to hit the average!

That makes a compelling argument for owning International Consolidated Uranium. The sector’s bear market looks to be over.

Demand for nuclear power is on the rise, globally. And this junior has strong leadership, cash in the bank and a great portfolio of projects.

Uranium is a great sector for investors. It’s still cheap and it’s in an uptrend. International Consolidated Uranium is a great low-risk, high reward stock to own right now.

Learn more about it at its website here.

— Resource Stock Digest Research