July 8, 2025: The backdrop for uranium equities remain constructive

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1. Spot price slips but fundamentals hold firm
2. Orano's Niger loss underscores diversification
3. EU uranium supply risks deepen
4. China's nuclear surge
5. Dorado JV confirms uranium discovery on first holes

Sponsored by Purepoint Uranium Group Inc. (TSXV: PTU | OTCQB: PTUUF)
https://purepoint.ca/

Transcript

This week on Uranium Spotlight: Orano pivots to Kazakhstan, Europe scrambles for secure supply, China accelerates nuclear growth, and the Dorado joint venture confirms an early uranium discovery.

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Spot Price Slips but Fundamentals Hold Firm

The uranium spot price closed last week at $77.50 per pound, down $1.25 from the previous week’s $78.75. While still hovering near multi-year highs, the market has seen a modest pullback as some sell-side pressure emerged and spot buyers showed a more measured pace.

Volumes have remained steady, with a healthy level of transactions reported—though nothing like the heavy buying that drove prices up earlier this spring. Importantly, activity remains well above historic averages, reflecting ongoing utility interest, speculative participation, and the presence of funds and physical vehicles in the market.

Looking more broadly, there’s still plenty of support under the market. U.S. utilities continue to sign long-term contracts at much higher levels than a year ago, and structural supply concerns remain unresolved. That’s evident in the fact that long-term prices are holding at about $80 per pound even as spot prices fluctuate slightly lower.

For investors in uranium equities, these price movements underscore two key points: first, the market remains volatile in the near term, with profit-taking and seller liquidity occasionally weighing on prices. Second, the underlying fundamentals driving the uranium thesis—energy security, decarbonization, and constrained mine supply—remain firmly in place.

So while we’re seeing a pause in the rally, this kind of consolidation is healthy, and the backdrop for uranium equities remains constructive. Investors should stay focused on the bigger picture rather than week-to-week price swings.. 

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Orano’s Niger Loss Underscores Diversification

Some important developments from French state-owned uranium giant Orano this week.

Orano announced that its subsidiary in Niger is on the brink of bankruptcy, citing restrictions imposed by Niger’s military government that have effectively shut down its operations there. This follows a series of blows in Niger over the past year: the government nationalized Orano’s SOMAIR mine, revoked its permit to restart the large Imouraren project, and blocked exports of uranium stockpiles—citing security concerns that have kept the key border with Benin closed.

At the same time, Orano has moved to strengthen its position elsewhere. It just opened a new uranium mining site in southern Kazakhstan, an expansion of its long-standing KATCO joint venture. With this new site online, KATCO is expected to return to its full nameplate production of 8.8 million pounds annually.

Orano’s pivot underscores how vital geographic diversification has become. In addition to Kazakhstan, it holds several joint ventures in Canada’s Athabasca Basin—home to the world’s highest-grade uranium deposits.

Why does this matter? France operates the third-largest fleet of nuclear reactors globally, and the European Union as a whole has more reactors than any single country—providing about 20% of its electricity. Orano is a cornerstone supplier for these fleets. Niger still supplied more than 8% of Europe’s uranium in 2024, but that link is now deeply uncertain.

For investors, this is a clear signal that security of supply is moving up the agenda for utilities and governments alike. Geopolitical risk is no longer abstract—it has already disrupted key supply chains. Companies with diversified production, and projects in politically stable jurisdictions like Canada, are now better positioned to capture premium demand from western buyers looking to lock in reliable uranium supply.   

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EU Uranium Supply Risks Deepen

Russia’s invasion of Ukraine continues to reshape Europe’s energy strategy, and last week’s Euratom Supply Agency report drove home a clear message: EU utilities must diversify their uranium supply and include at least two suppliers from friendly jurisdictions.

The report noted a preference for EU-based suppliers where possible — though since no EU country produces natural uranium, that really applies to the downstream stages of the fuel cycle, like conversion, enrichment, and fabrication.

When it comes to natural uranium itself, only two major producers — Canada and Australia — qualify as truly “friendly” to the EU. But those two alone can’t meet Europe’s total demand, and even together they fall short of providing the geographic diversity needed for supply security.

Adding to the urgency, this week the European Parliament formally introduced a motion to ban all uranium imports from Russia. That’s significant: Russia supplied 23.5% of the EU’s uranium in 2023, and even though that dropped to 15% in 2024, it’s still a large chunk. If you include Russia’s sphere of influence — Kazakhstan and Uzbekistan — the EU sourced 41.6% of its uranium from them last year, down slightly from 46% in 2023.

If a ban passes, Russia’s direct contribution to EU supply would disappear, and there’s a real risk Moscow could pressure Kazakhstan and Uzbekistan to divert more material to Russia and China, further tightening the screws on Europe.

And it’s not just Russia — once-reliable sources like Niger have become unstable as well.

In short, Europe simply doesn’t have enough access to geographically diverse, friendly uranium supply to fully replace Russian influence today. To change that, European utilities are going to have to invest — and likely pay a premium — to bring new uranium production online and secure long-term contracts.

For investors, this underscores a structural tailwind for uranium prices and a strong case for equities leveraged to new production. As Europe works to build an independent, secure fuel cycle, demand for non-Russian uranium is set to grow — and with it, opportunities for producers in friendly jurisdictions.

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China’s Nuclear Surge

China currently operates 57 nuclear reactors, and another 30 are under construction. Once those are online, their fleet will total about 87 reactors producing roughly 113 gigawatts of electricity.

But they aren’t stopping there. Beijing has announced plans to double that by 2040 — targeting 200 gigawatts of nuclear generation, which would mean building out closer to 180 to 200 large-scale reactors.

To put that in perspective, each conventional reactor like those being built today consumes around 440,000 pounds of natural uranium annually to supply its fuel assemblies. If China follows through, their expanded fleet could add an estimated 55 to 65 million pounds of new uranium demand per year — more than one-third of today’s entire global supply.

And yet, the world simply doesn’t have that kind of production capacity ready to come online in time. Without significant new supply — and soon — the market cannot sustain this level of incremental demand for long.

China, however, has been planning for this. They’ve quietly built up massive uranium stockpiles, estimated at 240 million pounds of U₃O₈ as of 2023. That’s nearly double the world’s annual supply today, and about ten times their current annual consumption. It suggests they intend to keep accumulating material to insulate themselves from market volatility.

Contrast that with the European Union, which collectively holds only about 88 million pounds in stockpiles — enough to cover roughly three years of refueling at current burn rates. For Europe, and for other major consumers, the coming supply crunch could hit much sooner.

For uranium investors, this underscores two key points: China’s buildout is not just aspirational — it’s already well underway and well-funded — and global supply remains structurally unprepared to meet this level of demand. That imbalance will continue to shape prices and sentiment in the uranium market in the years ahead.

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Dorado JV Confirms Uranium Discovery on First Holes

IsoEnergy and Purepoint have reported a significant step forward at their Dorado Joint Venture in Saskatchewan’s Athabasca Basin — confirming uranium mineralization in their very first drillholes of the program.

At the Q48 target, Purepoint, as operator, intersected uranium-bearing structures in two holes, with downhole gamma probe readings reaching as high as 79,800 counts per second. These intercepts are hosted in strongly altered basement rocks, a classic signature of an active hydrothermal uranium system — and consistent with the geology of other high-grade Athabasca discoveries.

The two holes cut a steep, north–south trending structure just below the unconformity, with radioactivity over several metres averaging more than 10,000 cps and peaking near 80,000. Drilling continues, with a third hole already underway to follow this mineralized corridor to the northeast. The team plans about 18 holes this summer at Dorado totaling 5,400 metres in this phase.

IsoEnergy’s CEO, Philip Williams, called this “exploration success that reinforces the strength of our partnership” with Purepoint, while Purepoint’s CEO, Chris Frostad, noted these early results demonstrate “we’re on the trail of something meaningful.”

For investors, the takeaway is clear: this joint venture, covering nearly 100,000 hectares of prime ground near the Hurricane deposit, is off to a strong start, validating both the geological model and the disciplined, systematic approach — and providing fresh upside exposure to Athabasca-grade uranium discovery potential.