Last week at the 121 Mining conference in London I had the chance to talk to Daniel Major, CEO of Goviex Uranium. We talked about the current sentiment within the uranium space, the long term outlook for uranium, and what’s next for Goviex. 

On The Next Bull Market Move we have Daniel Major, CEO of Goviex Uranium. How are you Daniel?

I'm very good thanks.

We're both in London today at the 121 Mining Conference. Earlier we were discussing the sentiment behind the uranium market and spot price. What are your current thoughts?

I think what we've seen is obviously a very constructive move up. I think the most interesting move is that we now got a spot market that's sitting right under a term contract price that hasn't moved yet. Why? Because no one's gonna want a contract at the current price.

So we still have a move up from here, but what you have seen is a very positive sentiment. Cameco indicated they were gonna buy their material from the market to meet their contract. They've only just started that process. 

They have got a long way to go in buying that metal, and after just ... What is it? One and a half million pounds of purchasing, we've already gone from 22 to 29. So I think it shows the potential there. You've now had the Kazatomprom IPO as well and they've made it very clear that they are now value not volume as an operator as well.

So I think we got all the right steps at the beginning of what could be a very interesting run over the next 12 to 24 months.

Goviex are based in Africa. What is it like working in Africa?

We're there for a reason. We like working in Africa. Commodities are a major part of every country's GDP down there, so they're very pragmatic about getting things done. Permitting is, I've said to the other people I know at the conference, is four to six months. You get things done, you've got governments who want the mining production to go ahead to generate jobs, to generate tax revenues that make a difference to the countries that you're in.

We've been in Niger since 2007, never had an issue operating there. We have a very supportive government. They realize that the existing mines are due for closure soon and they need new production to replace it.

We were talking earlier about the sentiment at this conference. It seems a lot of uranium companies are very busy. Can you talk about that?

Yeah, taking that as a benchmark, I have 23 meetings over two days. That's showing you there's a lot more interest. Some of the other commodities I know previously had been lucky to get five or six meetings in two days. That tells you a lot about sentiment.

I think in general what you're seeing is, we haven't got a bunch of raging bulls out there yet, but what you are seeing, because this is predominantly investment funds, is it's now getting on a lot of people's radar and they wanna understand where it's going. They're starting to do the groundwork now to get their heads around the market and like what they're seeing. And as a result, the uranium companies here at 121 are getting very full schedules of people coming through to see them.

So do you sense there are a lot of funds that have got money on the sidelines?

Yeah, most of them are very underweight in uranium and are now saying, "Look, this is a commodity that's moving. We have been watching it, waiting for the signals. We're seeing those signals come bare fruit. We really need to be looking where we can take this forward to.”

So what plans do you have for the next year? What's the main focus?

We will keep doing what we've been doing all the way along, which is we're focused on getting Madaouela into production. What we're doing at the moment is what we've been doing before, which is we focused on the project, optimizing the project.

We're very focused on seeing what we could do to bring both operating and capital cost down by a lot and to accelerate the build process on that project. We're targeting a number like $45 a pound, is our contract price to get going. That's very much where we're going with this. We're working with the debt guy still, working our way through that process.

Hopefully we'll be able to announce who the debt providers were gonna be on the project in the near future as well. We can provide those updates on the technical sides of the projects as we go forward as well.

And then we're just restarting those off take conversations that we stopped doing, because the uranium price was so low in the past that just made no sense. So yeah, we're very focused on just continuing to accelerate the feasibility study.

And sensibly so. We don't wanna be running out the door, spending millions of dollars and then suddenly find this is a false dawn. But at the same time we believe that we do have a fundamentally improving market, and we have to develop the project inline with it.

So do you feel that in this new uranium bull cycle, Goviex is going to be one of the major developers within it?

Absolutely, and that's always been our argument, is that when the cycle turns that we have the potential to be a first mover. Because we have permits already in place and we have a supportive government out there.

So yes, absolutely. And therefor what we've got to do is help ourselves become the first mover by reducing what the commitments are for the project. So there's no point in trying to be a first mover at $70 uranium. We've got to be a first mover at $45 uranium.

As a final question, is there anything that worries you about the uranium market going forward?

No. We've had two false dawns, it's always in the back of your head that this is gonna do it again, but I think we've had a lot of changes since 2011. The demand is now back where it was in 2011 and accelerating from here onwards.

You've had substantial energy cuts come, production cuts, you've had secondary supply cuts, you got inventory falling. All the things that you needed to fix which you haven't fix before, are kind of there in place now.

As long as Kazatomprom particularly and Cameco continue on their strategy, that will be good for the rest of the industry.

Thank you very much Daniel, and I hope we can have you back on the show again soon.

Absolute pleasure, thank you.

The Next Bull Market Move

Twitter / Newsletter / The Next Bull Market Move

For more information on Goviex Uranium visit https://www.goviex.com

To view disclaimer click here