By: Tomas Ronolski - AllPennyStocks.com News

Monday, February 23, 2015

Nearly four years after the Fukushima nuclear power plant meltdown in Japan, uranium prices continue to hover below $40 per ton. The nuclear power plant accident in Fukushima, which was caused by a tsunami, had raised questions over the future of nuclear energy. Japan, which relied heavily on nuclear energy until then, shut down all of its nuclear reactors post the Fukushima power plant meltdown. In much of the developed world, it was debated whether it is worth taking the risk with nuclear energy. Nuclear is a cleaner and cheaper form of energy. However, it does carry significant risks. Lawmakers and decision makers in much of the developed world felt that the risk was too much notwithstanding the benefits of nuclear energy.

Indeed, two years ago, the outlook for nuclear energy and thus uranium prices was gloomy. But all that changed due to some crucial developments. While much of the developed world has shunned nuclear energy, the energy hungry developing world still sees a future in it. Fast-growing major economies like China and India believe that nuclear has to be part of their energy mix.

Another important development has been the election of Shinzo Abe in Japan, who has been a proponent of nuclear energy. Under Abe, two of the 48 nuclear reactors that were shutdown have been restarted. Importantly, a lot more will be restarted over the next few years.

All these favorable developments have meant that the outlook for uranium prices and uranium miners has improved dramatically since late last year. Although prices are still nearly 50% below the levels seen before the Fukushima power plant disaster, supply cuts and increasing demand will provide a boost in the medium-term.

In this backdrop, Anfield Resources Inc. (TSX-Venture:ARY), an energy metals exploration, development and near-term production company, entered into definitive agreements with Uranium One under which it agreed to acquire the Shootarning Canyon Mill and a portfolio of conventional uranium assets from Uranium One.

These agreements were signed back in August 2014. On Monday, ARY provided a summary of the assets it will acquire upon closing of the transaction.

The assets include a joint venture project with Energy Fuels Inc. (NYSE MKT:UUUU) (TSX:EFR), two surface stockpiles, and a number of royalties on projects held by other publicly traded companies, according to a press release from ARY.

Corey Dias, CEO of Anfield, said the assets are synergistic and provide a strategic, stepped approach to production and revenue generation.

With the uranium market expected to make a comeback in the next two-three years, this is an excellent time for ARY to complete such a transaction. The transaction strengthens its portfolio, as well as, enhances its asset mix. In addition, as CEO Dias noted, the company’s near-term revenue options have been further strengthened by stockpiled uranium ore and royalty agreements.

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