Why Uranium Mining Could Make Someone Rich
The "uranium OPEC" failed. But production today is de facto controlled by a handful of companies.
Consider this. The world's top ten uranium mines account for 59% of global production. (The top mine, Saskatchewan 's McArthur River , alone puts out 15% of the world's supply.)
This is very concentrated, compared to other sectors. In the copper sector, the top ten mines turn out just 30% of global supply. For gold, the number is even lower. About 19%.
This means that what happens at a just few uranium mines around the world makes a big difference to the price for the metal.
For this reason alone, good uranium projects are interesting. Any deposit that could become a significant supplier will garner a lot of interest from would-be producers who want to break the stranglehold existing suppliers have on the market. And from existing suppliers, who want to keep as much control as possible over the sector.
But the severe concentration of global production is just one reason to look at uranium projects. Another, and perhaps better, reason is the extremely skewed grade distribution of the world's uranium mines.
Let's look at some charts. The first two show average reserves grade at the world's top ten biggest-producing copper and gold projects (thanks to Dan Edelstein and Micheal George from the U.S. Geological Survey for help in putting these together). The grade distribution for both is fairly even, forming an orderly curve.