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June 23 2014

Commentary by Eoin Treacy

China to accelerate nuclear power development

Thanks to a subscriber for this article from Xinhua which may be of interest to subscribers. Here is a section:

By the end of last year, 17 nuclear plants were in operation, with a total capacity of nearly 15,000 megawatts of electricity.

At a meeting of the National Energy Commission on April 18, Premier Li Keqiang announced the introduction of new nuclear power plants along the east coast "at a proper time".

Earlier this month, the Ministry of Environmental Protection released the environmental impact statements for two new nuclear power plants, one in Guangdong Province and another in Shandong, but this is still not enough in the longer term.

"China's nuclear power sector still has a long way to go before reaching the global average," said Ye Qizhen of the Chinese Academy of Engineering.

A proportion of 10 percent of nuclear power is an ideal number for China, Ye said.

 

Eoin Treacy's view -

With a serious pollution problem and energy consumption on a secular upward trajectory, China has little choice but to explore every avenue for electricity generation. The approval of new nuclear reactors suggests the period of contemplation that followed the Fukushima disaster has ended.  

Among Chinese companies related to the construction of nuclear reactors; Shanghai Electric Group (Est P/E 12.35, DY 3.04%) found support three weeks ago in the region of the 200-day MA. It will need to hold above the HK$2.80 area if potential for additional higher to lateral ranging is to be given the benefit of the doubt. 

 



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April 30 2014

Commentary by Eoin Treacy

Japan approves energy plan reinstating nuclear power

This article by Osamu Tsukimori and Mari Saito for Reuters, dated April 11th, may be of interest to subscribers. Here is an important section: 

But the plan may be too little too late for Japan's moribund atomic industry, which is floundering under the weight of estimated losses of almost $50 billion, forcing two utilities to ask the government for capital last week.

Plant operators have had to pay out almost $90 billion on replacement fossil fuels, with domestic media saying they have also spent an estimated 1.6 trillion yen ($16 billion) on nuclear plant upgrades to meet new safety guidelines.

A recent Reuters analysis shows as many as two-thirds of the country's 48 idled nuclear reactors may have to be left closed because of the high cost of further upgrades, local opposition or seismic risks.

 

Eoin Treacy's view -

Japan faces a daunting energy challenge as the weakness of the currency and collapse of the domestic electricity generation sector push energy prices up. The decision to reactivate stalled nuclear plants is to be welcomed but as the above article highlights many of these plants are badly in need of expensive remediation work which is unlikely to be done. This suggests that while restarting some plants at least partially ameliorates the situation, Japan needs to do a lot more to fix its energy policy. 

 

 



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February 21 2014

Commentary by Eoin Treacy

Uranium shares

Eoin Treacy's view -

A number of subscribers have written in asking about the uranium market over the last month, not least because of increasing interest in the resources sector generally. The outlook for the sector has improved somewhat of late with Japan drawing closer to restarting some of its reactors. (Also see David’s post yesterday). 

In the Chart Library many subscribers have uranium in their Favourites. The most common ticker is the Metal Buttletin price (MBURNXRE) but they no longer supply Bloomberg with this data. Therefore we would suggest replacing it with the uranium future which has the code UXA3. 

I thought it may be instructive to take a look at some of the more notable shares. 

 



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