So, here is my thoughts on why today’s news of Sprott taking over management of Uranium Participation Corp will light this market on fire and ultimately help drive the price of #uranium much higher and faster than most realize.
As a bit of history, I’m the guy who actually conceived of uranium participation corp back in the mid 2000’s (over a sushi lunch) in the year leading up to that lunch I had aggressively pitched Eric Sprott on going big in uranium stocks and predicted a move from $11/lb to $140/lb
I had got the $140/lb simply as the inflation adjusted price from the 70’s uranium bull market and over that year we had bought 20% of most uranium juniors and a decent chunk of Cameco. We also invested in a few privates and helped some shell companies acquire uranium assets
The uranium price had run up from the teens to the low 20’s around that time and the spot market was very thin much like today.
Over the course of that lunch I was ranting (like I’ve been know to do) about how certain I was that the uranium price would be moving up soon
That I was certain that the thin market was ripe to be squeezed higher and that our stocks would all rip as the price moved up. A few hedge funds had recently bought a little physical uranium and were storing it with Cameco or Denison as req by law/regs
The lunch ended with the declaration that I was going to pitch Eric Sprott to let me launch an uranium hold co ETF and I did that very afternoon and it was an easy sell. One thing I loved most about working with Eric is that there was no fucking around. He made quick decisions
Only thing was he didn’t want me or him to be ‘wasting time’ on the ETF.We were running billions in hedge fund and equity funds and I think that year heading towards $100mm plus in incentive fees. Some years we hit $200mm of incentives. The fees from a uranium ETF would be small
So I called up my good buddy Chris Roy at Cormark (Sprott securities then) and said let’s work on this idea together. Being a brokerage you can do the raises and get 5 percent. Or $5mm in fees on the first $100mm and Eric had blessed a $20mm lead order
Anyhow, long story short, we launched it and just the news of it coming sent the uranium price up several dollars. As orders for the ipo grew and uranium was purchased the price when up a few more. I think $22 to 28.50/lb in a few months as the prospectus got filed
The vehicle came out and kept trading at a premium and issue after issue swallowed up millions of lbs of uranium. Utilities felt incredible pressure knowing the vehicle was gonna keep gobbling up supply and this forced them to scramble and start entering into long term contracts
The spot price moving up over $100/lb and with little to no spot available forced them to sign contracts to try to get a discount and deals with $75/lb floors became the rage for miners. Those that signed long term fixed deals sub $50 took a look of flack from investors.
So one thing to understand is utilities or fuel buyers will always avoid buying spot prices and pushing them higher. They have zero interest in doing that. All they want to do is secure long term contracts for supply. They prefer to sign deals with ceiling prices
They also try when possible to sign deals centered around a price like $45/lb (like they have with Cameco) but if the spot price goes up they only pay a portion of the increase.
Over supplied market like we’ve had meant they could point to a weak spot price and contract as such
Back then upc wasn’t able to issue shares at the market and needed to trade at a decent premium in order to be able to justify paying issuance fees and accretively purchase more uranium.
So here we are today. About a year off the bottom of the uranium market. Yellow cake did an issuance and some miners bought some lbs. Well the big dog in the space is upc by a country mile and it’s been notably quiet for months cause they were obviously working on this deal
In order to change to the trust format and be dual listed in Canada and the USA they needed a licensed money manager. Enter Sprott 2021 and the physical ETF powerhouse it’s become. UPC will become much like the Silver and Gold etfs and be able do ATM issuance
This is a complete game changer. It means both retail and institutional investors will be able to cause physical uranium to be purchased like never before.
UPC shares will be issued with just a slight premium and uranium will be purchased as close to real time as possible.
Many of us uranium investors have a very positive view on physical uranium but often shy away from buying upc or yellowcake at a premium knowing well that any day a deal could be announced and the premium gets crushed and you can lose a quick 5 or 10 percent. Totally kills it
Demand has in my mind been incredibly pent up as a result of the lack of a clean structure. Also, many institutions will only allocate on a deal if that. Liquidity and lack of ability to get in or out near NAV is a big concern (as it should be). Well very soon that’s solved
Not only that but consider the various uranium etfs that also hold a piece of Uranium participation corp or Yellowcake. Those etfs continually issue shares and basket buy their holdings. I imagine often pushing the premium up on upc and likely cause other shareholders to sell
So once the transition is complete when uranium stock etfs get inflows and buy upc it will directly cause uranium lbs to be purchased. This improved liquidity may end up causing some etfs to increase there weighting in upc as a result. (Btw say good bye to yellowcakes premium
I doubt yellow cake will raise much more money unless they can issue ATM as well and I don’t know AIM rules.
So, carrying on with upc. Having it nyse listed will give it much better exposure and make it eligible for many USA based funds that either cant or don’t invest in Canada
The total size of USA market is around $50 trillion vs Canada $3.5 trillion. 13x bigger.
UPC has not done an issuance yet in this #uranium bull market. It was trading at a discount last year and actually sold uranium and bought back stock because it was accretive to do so!
So the North American markets have been ‘underserved’ for a year.
I know I will be buying UPC as soon as it has the ATM ability and I know my purchase will go to new uranium purchase. I’m so fucking sure that the uranium price will be double in a few years or less...
I’ll mortgage a home to buy it. It’s the biggest no brainer safe trade you can find. If only a double in 10 years that’s 7 percent per annum. And it will double in 2 years or less.
Institutions, high net worth, and retail investors will flock to it.
So as some will argue.. that’s just noise. It was gonna happen anyhow. Well on to the next part... it’s not just about soaking up the spot market it’s about releasing this a new beast and what it does to the market psychologically
Fuel buyers / utilities are going to soon panic as they see the UPC doing volume every day and issuing shares. They will be following the spot market and wondering like all of us where the price will go next. How many more marginal lbs are available in the spot market?
Potential sellers of spot will likely decide to hang on and ‘see’ what happens. It’s a totally new dynamic and it’s effect shouldn’t be under estimated.
In the past, just prior to an issuance by a upc or yellow cake they would put a call into a trader or Denison on behalf of upc
Would seek to purchase some lbs before issuing shares. Now in the midst of a new bull Sprott will be able to issue shares and purchase 100k lbs at a time. Weekly, daily? What if there’s a big high demand day? 1mln lbs a day? I guarantee you that the spot market be absorbed
As the price starts to squeeze more and more investors will take note and be excited. It will become obvious that their is little to no spot available. As the uranium market grows and the total capitalization swells
More institutions will consider investing with the improved liquidity in uranium and the mining equities. They will take large positions in the uranium stocks and all buy uranium. In the final stage the utilities will be crying and whining to congress
The uranium investing community will soon learn the power they have and we will get sweet revenge on the utilities that didn’t give two shits about trying to support and fund the uranium mining community by just offering to pay sustainable prices.
The fact is there is fuck all uranium out there and we all know that supply is going to dramatically short for years to come. Mining supply simply can’t come on quick enough to stop the financial sector from driving the uranium price to $200/lb and holding it there
Some anonymous joker made fun of my early comments on $gme like speculators squeezing the uranium price while buying up uranium stocks. Well $gme stock traders and the like.. consider this... they have been able to push a piece is shit $5 stock to $175/sh and hold it there
That’s $12.65 billion of market cap being held in one single dog shit garbage company that not worth $500mln in most peoples mind. UPC has a market cap of just under $600mln usd.
I promise you if even $1bln tried to squeeze into the physical uranium space it will fly to $150/lb
As I’ve discussed in the past, fuel buyers can be held hostage by financial investors that are motivated to drive uranium to high prices. They will not shut down a nuclear plant because they have to pay $200, $300 or even $500/lb in the short run.
Consider what people paid for electricity in California or Texas when there was shortages. You don’t turn off the power because of modest price spikes and even $500/lb uranium would only add few cents to the power price.
The extra juice we will ultimately get in this uranium bull won’t come from rational investing, it won’t come because of the structural shortage, it will come as a result of greedy speculators that want to play a part in gaming the market. Like $gme traders.
The reckless youth who don’t give a shit if they lose $5k-10k. Half share trading half wits that take pleasure in breaking things. Especially a boring snotty industry staffed with phd’s and stuffed with arrogance. They will take great pleasure in squeezing the snot out them
And I’m gonna enjoy watching them. So come on $gme traders this is the sort of trade you’ll tell your grand kids about some day. Time to jump on the #uraniumsqueeze trade and make +10x on basket of uranium juniors.
As you think about this thread over the coming hours and days. Just consider that when UPC starts gobbling and the price is pushed to $200/lb how little leverage the utilities have. How much money uranium stock holders will make.
Last point. We’ve seen some miners buy some uranium. With improved liquidity and atm ability how many uranium miners will put more cash into physical uranium. How many fuel buyers will quietly buy some upc in there PA? Lol
“Doubling the price of uranium would add about 10% to the cost of electricity produced in existing nuclear plants” The cost of raw uranium is $0.0015/kWh $300/lb would only double the operating cost of nuclear power. #makethempay#uranium
Here a little shot of some graphene. Note how light it is and filling and how it wiggles and giggles. Was very cool. And big pitches of it just collapse to incredible fine powder between the fingers. Washes off with soap. Easer then chimney soot or bbq greasy soot. Obvious why…It’s pure carbon whereas chimneys and bbqs have all sorts of sticky contamination and harmful chemicals etc.
We handle coal, charcoal and other carbon material. This version of carbon is pure is not a concern.
You should be more concerned about touching the remains of burn wood in your typical campfire. How many times have you dropped a hotdog or a burger, brushed it off a little and ate it anyhow?
Further, pure carbon actually has important medical benefits in some contexts.
Any fine particles in the lungs can be a concern. For example ‘black lung’ disease caused by miners in coal mines. For centuries people have mined coal and breathed coal dust. We know what happens… and again. Mined coal has piles of impurities and toxins.
I’m trying to not be insulting to the intelligence of people questioning the safety of graphene. But… seriously it’s hard to not just say how uninformed and ignorant they are. Either that or they are liars seeking to benefit from buying stock from others cheaply or playing short selling games.
Only one company in the world makes fractal graphene aggregates. (Not oxide graphene)
This is very special material, pure and powerful. Like nothing else.
Only one company has being experimenting with fractal graphene aggregates for years.
They’ve made reactive shell graphene and an activated graphene.
These materials perform like no others.
Along with these graphene variants, the company is working on many amazing things that will revolutionize the materials sciences.
This company is Hydrograph Clean Power Tech. $hg $hgraf
I just spent 3 days with the team doing my due diligence. Watching graphene being made, and even got to scoop some out of the original test chamber as we recreated the original discovery for a documentary film I’m financing.
The FGA-1 graphene is amazing stuff. Like nothing I’ve ever seen. When fresh it wiggles and giggles as an incredibly light gel like substance. I pinched some and it collapses into a silk smooth pure carbon black powder on my fingers which washed off with soap. Think of it like the finest purest chimney soot. But at the atomic level it’s 100% crystallized and 100% SP2 bonding. Something no one else in the world can produce due to there patents.
It’s important to understand, if you compared the safety of the graphene to the soot from a chimney or the black ash your bbq it’s not even close.
Their graphene material is 100% pure carbon. I’ll include some of the toxic elements in your chiming and bbq. Note that in your bbq this elements end up on your food and you eat them. Sometimes little black particulates drop from the lid when you shut it. Sometimes these particles are in the grill.
See below
The soot found in household chimneys and barbecues is a complex mixture of fine particles and toxic chemicals created from incomplete combustion. The exact composition varies depending on the fuel and burning conditions, but these particles are hazardous to inhale or ingest, posing significant health risks.
Carcinogenic particles and chemicals
•Polycyclic Aromatic Hydrocarbons (PAHs): These are some of the most dangerous components in soot. PAHs are a class of chemical compounds that are known carcinogens and have been linked to an increased risk of skin, lung, and bladder cancer in humans.
•Arsenic, cadmium, and chromium: These heavy metals are known carcinogens that can be found in the fine black or brown powder of soot.
•Benzene and formaldehyde: These are cancer-causing chemicals that are formed during the incomplete burning of organic materials. They are commonly found in the smoke from barbecues and chimneys.
Other toxic compounds
•Acids: Soot contains corrosive acidic compounds, such as sulfuric and carbolic acids, which can irritate the respiratory system and other mucous membranes.
•Volatile Organic Compounds (VOCs): In addition to benzene, other hazardous VOCs are emitted during combustion. For example, barbecue smoke contains hydrocarbons like acrolein, which can damage the lungs.
Sources and risk factors
•Combustion source: Soot particles are generated from any incomplete burning of carbon-based material, including wood, charcoal, fuel oil, and gas
•Cooking method: The type of barbecue fuel used can affect the amount of pollutants produced. For instance, charcoal briquettes are known to release higher levels of particulate matter and PAHs compared to gas grills.
•Exposure level: People who are routinely exposed to high concentrations of soot, such as chimney sweeps, are at a higher risk of health issues, including various cancers.
I’m not gonna dwell on this in the future because actual scientists understand exactly how safe 100% pure graphene is.
We inhale bbq smoke. Me and most of my friends had spent countless hours over the years sitting around camp fired saying ‘white rabbits’ as the smoke wafts in our faces and yes we even breath it in. Then there’s smoking cigarettes and other substances. Fine particulate matter is inhaled with many toxic substances.
Further consider the crap people vape!
Final point on this. Graphene isn’t or eating, breathing, or drinking. It’s not going to be a powder sold to the public on the light fluffy form.
The latest version of the machine now makes slightly compressed pucks that reduce the volume by the right amount to preserve its use for industry but reduce shipping cost. In this form it will be sent to manufacturers and it will then be blended in recipes to make amazing things.
Once mixed to manufacture new materials to make products the 100% sp2 bonding nature of the graphene means it will no longer be graphene. It BONDS like nothing else! It combines with the other material and forms the tightest bonds imaginable.
This is a key point because it’s locked into polymers, or metals, or organic fibres. It won’t be particulate matter.
This is unique to them I should add, due to the purity and 100% SP2 bonding. No one else can do this. This is extremely special and it’s just now becoming understood and highly prized in the manufacturing world.
Remember there’s just 65-70 companies currently working with it. The word about all use cases are spreading. It won’t be long until thousands of companies are working with their graphene variants.
It also won’t be long until every military power in the world is either working with them or trying to steal there tech and reverse engineer their patented processes.
This is why the DOD must act now. Even if the USA and other nato countries try to ramp up production and development of products with their graphene it will be a real challenge to stay ahead. Top military scientists will be heavily funded abroad. Some nations have much greater abilities to ramp up new manufacturing processes.
The USA has gutted there manufacturing base. The time to act is now. It’s a matter of national security.
$pdn looks good for a bounce. But, I'm sharing this long term 'price' action chart in part as a warning because these charts are so misleading. "The look how cheap junior resource companies are" is constantly being touted by bulls and demonstrated with historical share price charts. Fact is, so many companies are pure garbagio. Paladin on the other hand was an unbelievable performer last cycle. Still don't be fooled...
Now look at this chart... I bought the hell out of $pdn back in late spring of 2020. To get my 13+ mln shares I had to buy the majority of the daily volume for a couple weeks. At the time, I believe I was the bulk of the reason the stock broke out from decade long death spiral. I ended up taking profits around the pre split $1 or $10 level post split around November of 2021. Why? I'll explain. Note the market cap blew out over $2bln
at that time
I had loaded up on it because I was bullish on Uranium post covid mine shutdowns vs nuclear plants continued operation. I saw the end of the bear market coming due to electricity demand exploding. EV's AI etc.
But the run it had...wow. Was fast and furious. But, I also invested in $pdn when at Sprott back in 2003. right as it started taking off from around the same price I bought back in 2020. 8c a share. The first go round for me, I had to buy in the market for a week and again I took the stock from 8 to I think 12-13 cents. Then was able to convince John B. to sell us 10% of the company plus a warrants so we ended up at 19.9% our fund prospectus limit. We then road Johns coat takes for a 100x+ win as the stock went bonkers along with the uranium price
Inspired by @SahilBloom's excellent thread on wealth building, I wanted to share some additional perspectives from my personal experience - particularly on the role of energy management and authentic value creation. We mostly agree but I can't help bring my contrarian approach to these subjects with the hope of adding to the conversation.🧵
1/20 The uncomfortable truths about wealth building nobody talks about, and how to actually succeed in the long run. Time for some real talk.
2/20 Hard truth: Many get rich without creating value. The mining sector shows this - "professionals" who've spent careers destroying capital. Boot-licking and nepotism are real. Ignoring these realities only breeds frustration.
Thread on #AI #bubble and my thoughts on how things will play out and the parallels to other bubbles like #y2k / dotcom / #internet bubble.
Back in the late 90’s I was working in tech with my main focus on upgrading firms to Microsoft desktops and servers Helping them go fully digital and for some it was the first time they got email address and websites. It was the exciting dawn of the Internet age. I learned a lot and eventually what I learned caused me to flip careers and go into investing/trading and I never looked back.
From the very early on it was crystal clear that the Internet was going to explode in popularity and everyone would be using it for business and personal needs. It was a massive wave to ride and leading up to y2k it was a crazy gravy train for anyone working in the field
All tech stocks at that time exploded higher and higher creating the historic bubble we now look back on and everyone gets what happened in hindsight but some actually saw it forming and correctly invested in it going up and shorted it going down. The question is what did those people see that others didn’t at the time ?