Financial News
Big Tech is Going Nuclear to Power AI
As artificial intelligence continues to revolutionize industries, there’s one crucial aspect that remains largely under the radar: power consumption.
Training advanced AI models, especially large language ones, demands a staggering amount of electricity. So much so, that the carbon footprint of these data-intensive tasks rivals that of entire cities.
Which is why some of Silicon Valley’s most elite are turning to nuclear power as a solution to cutting carbon emissions and weaning the world off Russian gas.
A recent job posting reveals that Microsoft is planning to grow its energy infrastructure by using small modular reactors (SMRs) to fuel the immense data centers driving Microsoft Cloud and AI.1
This isn’t the first time Microsoft has delved into the nuclear realm. In 2008, Bill Gates founded leading nuclear innovator TerraPower, which has since been meticulously crafting designs for these very SMRs.
Of course, Microsoft is far from the only Silicon Valley juggernaut acknowledging the promise of nuclear energy. Billionaires Jeff Bezos, PayPal and Palantir co-founder Peter Thiel and OpenAI founder Sam Altman have also been investing big in nuclear.
Helion Energy, backed by Thiel, recently secured a staggering $500 million in funding, aiming to develop a groundbreaking nuclear fusion system by 2024. Altman also recently provided funding and assumed the role of chairman at Oklo, a company dedicated to commercializing nuclear energy through the production of small, mass-manufactured reactors.
These individual commitments tell only part of the story.
Last year alone, investors poured a record $3.4 billion into nuclear startups,2 eclipsing the total investments made over the previous decade. Nuclear-related deals have also jumped significantly over the last 10 years from fewer than 10 annually to 28 in 2021.
The higher demand for uranium combined with tight supplies has propelled uranium prices to a 12-year high, reaching $72 in September.3
A Rising Star Within the Booming Uranium Market
As venture capitalists pour billions into nuclear startup projects, Katusa Research has uncovered a potential standout in the uranium market that could eclipse them all.
Katusa Research just released an extensive report on Uranium Royalty Corp. (NASDAQ:UROY) (TSX:URC), an up and coming player in the uranium sector with substantial interests in some of the world’s premier uranium mines.
Uranium Royalty Corp stands out as the first company to embrace the royalty and streaming business model exclusively within the uranium sector. This move enabled the company to secure significant royalties on premier mines during a period when uranium prices were notably lower than present rates.
Uranium Royalty’s royalty model offers a unique advantage that allows the company to receive cash from mines it invests in for a lifetime, sharing in the success of profitable mines.
The company has royalty interests in 18 projects that promise substantial cash flows, including Cameco’s (NYSE:CCJ) McArthur River, which includes exceptionally high ore grades and licensed capacity, and Cigar Lake, which produced 14% of the world’s uranium in 2022.
Uranium Royalty Corp. (NASDAQ:UROY) (TSX:URC) maintains a possession of over 2 million pounds of physical uranium, acquired at an average price of $44.39 per pound. Given that the present price surpasses $70 per pound, the company has realized a gain of 70%. Furthermore, it holds no debt and boasts more than $138 million in liquidity.
Behind Uranium Royalty is a team that’s a blend of experience and visionary zeal. President and CEO Scott Melbye is an industry expert with over 40 years in the uranium space including as President at Cameco and Amir Adnani, the President, CEO and founder of Uranium Energy Corp (NYSE-A:UEC).
When you consider all of this, it comes as no surprise that large funds like Global X Uranium ETF and Sprott Uranium Miners are investing in Uranium Royalty Corp.
For further details, click here to explore Katusa’s comprehensive report on Uranium Royalty Corp. (NASDAQ:UROY) (TSX:URC).
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