Profile on Uranium

Athabasca Uranium Presentation
The downturn in the Uranium market after the Japan tsunami has created volatility in an already sensitive and fragile market. Uranium prices are starting to recover and this has created opportunities in the Uranium sector for M&A. We all watched as Rio Tinto made a move to take over Hathor this year and this signalled a start to a developing trend in the continued use and the longevity of the Uranium market.

Rio Tinto is now the registered holder of 135,290,661 Hathor common shares, representing 100 per cent of the outstanding Hathor common shares on a fully-diluted basis. 

About Rio Tinto in Canada
Rio Tinto employs over 13,400 people across its extensive operations in Canada, which include mining and manufacturing interests in alumina, aluminium, iron ore, diamonds and titanium dioxide. Rio Tinto also operates exploration activities, research and development centres, port and rail facilities to support various businesses, technical and sales service centres, and substantial hydroelectric power facilities in British Columbia and Quebec. In addition, Canada is home to the global headquarters of Rio Tinto Alcan.
Uranium although reflected negatively over the incident in Japan has become a  cornerstone in energy use world wide and several countries continue to expand on the atomic energy facilities. The markets are always forward looking and as the market once saw predictions of collapse and a turn in Uraniums use these same critics may now be slowly turning back to follow in line with a strong return on the price of Uranium and its open use.  I even read an interesting article on a possible use by automobiles in the future based on small atomic cells fuelled by depleted Uranium that may one day be the normal energy used by manufacturers.

I think this all comes down to a reliance on Uranium as a fuel source for generations to come. It was not long ago that the green energy camps all proclaimed Crude Oil a dead issue and that the global conscience would push oil aside for electric or hydrogen energy. Well time has passed and oil prices continue to rise as the world energy demands grow at an alarming rate yet again.

China has proven to be a driving force in where energy and several mineral prices go. The direction can be easily influenced by a quote out of the Chinese government. These ripple effects can created depleted stockpiles overnight. China's appetite for energy has seen the burning of coal at an unprecedented rate and the pollution clouds can drift half way around the world. This constant demand will become a supply need that may not be met in the very near future. China knows that to keep up with demands they will need to incorporate Atomic Energy and they will need to do it fast. Where will the world Uranium prices be when Chine puts 50 nuclear plants on line in the near future?

This study on Uranium brings into focus the story of Athabasca Uranium Inc. - V.UAX.

The Company has completed the acquisition of the remaining 50% interest in its McCarthy Lake Project, details of which were announced in the Company's news release dated February 28, 2012.  Athabasca Uranium is now the 100% owner (subject to a 2.5% NSR royalty) of the 4,082-hectare Project, located in the Athabasca Basin region near the West Bear uranium deposit.  The Company is designing an exploration program for McCarthy Lake which will likely include an IP resistivity survey and drilling to test the RZ10 conductor array, also as announced in February. 

Regarding the completion of the McCarthy Lake transaction, UAX CEO Gil Schneider commented "The recent resurgence of interest in the uranium sector, a hot-button topic in the US political arena, has led to an increased interest in exploration of the Athabasca Basin.  The McCarthy Lake Project represents a solid joint venture opportunity and the Company is extremely active in this regard." 

The Company is following up its successful 2011 drill program, in which alteration was encountered in three of its five holes.  A total of up to ten 350-meter holes (3,500 meters total) are planned, including drilling a minimum of one to two holes at Volhoffer Lake (Keefe K-2) to test subsurface conductors.  Comprehensive interpretation of drill results from Phase 1 is ongoing and should be available shortly. 

On mobilizing the camp, UAX CEO Gil Schneider commented "With the positive results from the program last winter, the company is extremely excited about exploring the Keefe alteration zone. While all alteration zones and deposits in the basin are unique, they do share commonalities, such as silicification and base metal enrichment. The Keefe alteration zone has both of these features as well as quartz enrichment, which suggests that this zone has been subject to high temperate hydrothermal activity." The Keefe Lake Phase 2 program is a continuation of last year's drilling and has been designed to test the limits of the alteration zone as well as to drift on Hole AU4-01, which exhibited the most pronounced mineral enrichment, silicification and gamma radiation readings. 

About Athabasca Uranium

Athabasca Uranium Inc. is a uranium exploration and development company exploring an aggregate of over 60,000 hectares strategically located in the uranium-rich Athabasca Basin region of northeast Saskatchewan.  The Company's stated vision is to explore the region using leading-edge technology to become a world-class uranium mining company.  Additional information on Athabasca Uranium and its vision is available on the Company's website at www.athabascauranium.com.

Today, we get 20% of our energy needs from 104 nuclear plants. Compare that with 44% of our needs being provided by over 1500 coal plants. France gets 77% of their energy needs from nuclear energy. Even South Korea ranks higher than the US. Despite this, the US is expected to possibly approve perhaps five nuclear plants by 2018- just approve, not build. Internationally, over 50 plants are expected to be approved, built or operational by 2018- 20 of them in China alone. To put it in perspective, France has 1 nuclear plant for every 1.1 million people while the ratio in the US is 1 plant for every 3 million people. Full story link

Uranium - The World Picture

http://www.athabascauranium.com/uranium.html
World nuclear capacity reached 372 GW in 2007. A total of 31GW of nuclear capacity (34 reactors) is now under construction, with the majority in the Asia-Pacific region.
In the United States, over 17 companies are actively pursuing licenses for more than 30 nuclear reactors. Worldwide over 90 reactors are in various stages of planning. World nuclear capacity is projected to rise to 397 GW by 2015 and 433 GW by 2030.

The Supply Crunch is Coming

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Uranium mine production from 2003-2005 satisfied only 53% of estimated demand for uranium. The balance of demand was met from stock depletion and dilution of weapons-grade highly-enriched uranium. (“Megatons to Megawatts” program between the former Soviet Union and USA expires in 2013 – Russia has indicated it will not renew). World uranium consumption outstripped production in 2008 and 2009 and is forecast to do so again in 2010.

Trends

Spot and Long Term Pricing

Over 90% of all uranium contracts are negotiated on long-term price.Uranium does not trade on an open market like other commodities.Contracts are negotiated between buyers and sellers privately.

The Saudi Arabia of Uranium … is Canada

Northern Saskatchewan’s Athabasca Basin stands in marked contrast to global ‘conventional’ deposits. Many of the Basin’s most significant deposits are just a few tens of meters wide and hundreds of meters long and boast grades tens to hundreds of times greater. Fully 50% of McArthur River’s reserves, over 200 Million lbs, is contained in an area smaller than a football field with an average grade of 20.67%.

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