Canada-focused uranium juniors have welcomed news this week that the government has pledged C$970 million to develop a grid-scale small modular reactor (SMR) in the country as a key part of the administration's strategy to cut carbon emissions.
On October 25, it was announced that the new reactor - the first commercial scale SMR in the G7 - will be developed by utility giant Ontario Power Generation (OPG), which already provides around half of all electricity in the province of Ontario. The nuclear reactor will be located in the township of Darlington.
The cash would go toward preparation work before nuclear construction begins, including the project design.
SMRs have the capacity to generate up to 300 megawatt electrical (MWe) per unit, compared to 700 MWe for a large conventional reactor and have a number of advantages. They are a fraction of the size of their conventional counterparts and can be factory-assembled before transport to their location. They also can provide 'clean' power in remote areas.
Reportedly, Canada's new SMR will mean about 740,000 fewer tonnes of greenhouse gas emissions per year - or around the equivalent of emissions from 160,000 gas-powered cars. Around 15% of Canada's electricity is currently sourced from nuclear.
Net-zero emissions
Canada's Natural Resources minister Jonathan Wilkinson said on Tuesday: "Canada, like the rest of the G7, is targeting net-zero emissions by 2050. The government has an intermediate goal to cut emissions 40% to 45% below 2005 levels by 2030. Nuclear power is one source that can help in reaching our climate targets while addressing growing future demand."
The province of Saskatchewan, Canada is home to the famous Athabasca basin and the northern part of the province has the largest high-grade uranium deposits in the world. Saskatchewan provides around 25% of the world's uranium supply for electricity generation.
Junior explorer Kiplin Metals is earning into the 531-hectare Cluff Lake Road (CLR) project in the region. Following news of the government funding, director Peter Born told investors: "Growth and resurgence in the nuclear sector will require additional uranium deposits and Kiplin is focused on exploration in the uranium-rich Athabasca district".
Notably, the firm's CLR property is completely surrounded by Fission 3.0 Corp.'s high-profile Paterson Lake North (PLN) project.
Other small caps operating in the same area include Standard Uranium Ltd (TSX-V:STND, OTCQB:STTDF), which boasts five projects across the highly prolific basin, including the Sun Dog property and its flagship Davidson River project.
Few bright spots
The firm recently said it "strongly" believes the uranium market will be one of the "few bright spots" ahead in the investment landscape.
Appia Rare Earths & Uranium Corp is on the hunt for high-grade uranium in the Athabasca Basin at its Loranger, North Wollaston, and Eastside properties, It currently holds the surface rights to exploration for about 57,048 hectares in Saskatchewan.
Elsewhere, Marvel Discovery Corp has just announced striking a joint venture agreement with Carmanah Minerals to earn a 50% interest in the Walker claims, which sit in the Athabasca basin.
The company already controls 100% of the KLR and Highway North claims along the Key Lake Shear Zone which is home to some of the world’s highest-grade uranium mines, including McArthur River and Cigar Lake.
Trench Metals Corp has the right to acquire a 100% stake in two highly prospective uranium projects in the basin - the Higginson Lake property and Gorilla Lake.
"This recent announcement of almost $1 billion in funding support from the Federal government to develop small modular reactor (SMR) is a meaningful milestone for the continuing renaissance of the nuclear sector and the increasing demands to explore for, and develop new uranium deposits," said its president Simon Chen.
"Trench Metals is well positioned in the Athabasca uranium district to participate in this search for new uranium deposits," he added.
All currently operating nuclear reactors in Canada have been designed domestically and are known as CANDU reactors. There are 18 such reactors in Ontario and one in the state of New Brunswick.
Ten are in operation outside Canada.
Contact the author at giles@proactiveinvestors.com