Florida Power and Light, about Cigar Lake and other significant uranium supply sources at a Platts-sponsored nuclear fuel conference. We asked him if he was aware of the risks at Cigar Lake and elsewhere. Calmly, he answered that he was.

Obviously, Mr. Kundalkar was not. (Hopefully, he is finally reading our new book, “Investing in the Great Uranium Bull Market,” which we gifted him.)

The announcement of water deluging the $12 billion ore body at the rate of 1,500 cubic meters an hour at the Cigar Lake uranium mine shocked the nuclear industry on Monday. As anyone who closely follows uranium mining stocks now knows, construction at Cameco Corp’s half-owned mine in Canada’s uranium-rich Athabasca Basin will be delayed by at least one year, possibly much longer. The whole mine was flooded after massive steel doors – reinforced with concrete – could not hold back the water.

One wag joked Cigar Lake should instead be turned into a hydroelectric project. This surprising development means Cigar Lake’s heralded supply of 7 million pounds of uranium oxide relieving a very tight uranium market by 2008 is gone. Future supply just got 30 percent tighter than was forecast.

“I wouldn’t be surprised if the uranium price gets pushed much higher,” Sprott Asset Management Market Strategist Kevin Bambrough told us in a tape-recorded telephone interview. “It should definitely steepen the curve that we’ve seen. I can’t imagine there will be aggressive sellers.” During our interview, Bambrough calculated the net asset value of Uranium Participation Corp (TSX: U). “As we speak, UPC is at C$10.90/share,” he said. “For the net asset value at that price, the uranium price would have to be about $75/pound. That’s where the stock market is telling you the price should be. That’s where investors think it is going.”

U.S. utilities should panic. Less than one month ago, we challenged Rajiv Kundalkar, Vice President of Nuclear Engineering for Florida Power and Light, about Cigar Lake and other significant uranium supply sources at a Platts-sponsored nuclear fuel conference. We asked him if he was aware of the risks at Cigar Lake and elsewhere. Calmly, he answered that he was.

Obviously, Mr. Kundalkar was not. (Hopefully, he is finally reading our new book, “Investing in the Great Uranium Bull Market,” which we gifted him.)

ine was flooded after massive steel doors – reinforced with concrete – could not hold back the water.

One wag joked Cigar Lake should instead be turned into a hydroelectric project. This surprising development means Cigar Lake’s heralded supply of 7 million pounds of uranium oxide relieving a very tight uranium market by 2008 is gone. Future supply just got 30 percent tighter than was forecast.

“I wouldn’t be surprised if the uranium price gets pushed much higher,” Sprott Asset Management Market Strategist Kevin Bambrough told us in a tape-recorded telephone interview. “It should definitely steepen the curve that we’ve seen. I can’t imagine there will be aggressive sellers.” During our interview, Bambrough calculated the net asset value of Uranium Participation Corp (TSX: U). “As we speak, UPC is at C$10.90/share,” he said. “For the net asset value at that price, the uranium price would have to be about $75/pound. That’s where the stock market is telling you the price should be. That’s where investors think it is going.”

U.S. utilities should panic. Less than one month ago, we challenged Rajiv Kundalkar, Vice President of Nuclear Engineering for Florida Power and Light, about Cigar Lake and other significant uranium supply sources at a Platts-sponsored nuclear fuel conference. We asked him if he was aware of the risks at Cigar Lake and elsewhere. Calmly, he answered that he was.

Obviously, Mr. Kundalkar was not. (Hopefully, he is finally reading our new book, “Investing in the Great Uranium Bull Market,” which we gifted him.)

forecast.

“I wouldn’t be surprised if the uranium price gets pushed much higher,” Sprott Asset Management Market Strategist Kevin Bambrough told us in a tape-recorded telephone interview. “It should definitely steepen the curve that we’ve seen. I can’t imagine there will be aggressive sellers.” During our interview, Bambrough calculated the net asset value of Uranium Participation Corp (TSX: U). “As we speak, UPC is at C$10.90/share,” he said. “For the net asset value at that price, the uranium price would have to be about $75/pound. That’s where the stock market is telling you the price should be. That’s where investors think it is going.”

U.S. utilities should panic. Less than one month ago, we challenged Rajiv Kundalkar, Vice President of Nuclear Engineering for Florida Power and Light, about Cigar Lake and other significant uranium supply sources at a Platts-sponsored nuclear fuel conference. We asked him if he was aware of the risks at Cigar Lake and elsewhere. Calmly, he answered that he was.

Obviously, Mr. Kundalkar was not. (Hopefully, he is finally reading our new book, “Investing in the Great Uranium Bull Market,” which we gifted him.)

(TSX: U). “As we speak, UPC is at C$10.90/share,” he said. “For the net asset value at that price, the uranium price would have to be about $75/pound. That’s where the stock market is telling you the price should be. That’s where investors think it is going.”

U.S. utilities should panic. Less than one month ago, we challenged Rajiv Kundalkar, Vice President of Nuclear Engineering for Florida Power and Light, about Cigar Lake and other significant uranium supply sources at a Platts-sponsored nuclear fuel conference. We asked him if he was aware of the risks at Cigar Lake and elsewhere. Calmly, he answered that he was.

Obviously, Mr. Kundalkar was not. (Hopefully, he is finally reading our new book, “Investing in the Great Uranium Bull Market,” which we gifted him.)

Florida Power and Light, about Cigar Lake and other significant uranium supply sources at a Platts-sponsored nuclear fuel conference. We asked him if he was aware of the risks at Cigar Lake and elsewhere. Calmly, he answered that he was.

Obviously, Mr. Kundalkar was not. (Hopefully, he is finally reading our new book, “Investing in the Great Uranium Bull Market,” which we gifted him.) Neither were a majority of utility fuel managers who failed to honestly appraise the risks involved with their supply sources. Those who neglected to lock up uranium inventory for their reactors through 2011 are now the butt of jokes at the Nuclear Energy Institute’s (NEI) annual uranium conference presently in session in Quebec City, Canada. Many fuel brokers and utility industry consultants emailed or phoned us, over the past six months, announcing they were convinced the uranium price was “too high.” Each one sincerely believed Cigar Lake, Kazakhstan and/or Olympic Dam would bring the uranium price back down to earth.

“I still say the uranium price is going to test and exceed the inflation-adjustment highs of the prior peak,” Bambrough told us. “I think the (peak of) $110 to $120 will get taken out in this market.” Is this the super spike we’ve been waiting for, and will it sustain at higher levels? “We’ll have to see how high the spike goes,” Bambrough pondered. “I still think some companies are going to be able to sign long-term deals around $100/pound. I don’t think that will be a problem for some to have that opportunity.”

How Serious Is the Cigar Lake Supply Problem?

“This is probably going to set Cameco back much more than a year,” Bambrough predicted. Last spring, he had speculated in another interview about how the uranium price might be affected if Cigar Lake were delayed more than was then anticipated. “It was supposed to do 18 million pounds a year by 2010,” he explained. “We’re losing seven million pounds out of 2008.