What is a Small Modular Reactor (SMR) and why is it important?

Small Modular Reactors are smaller, factory-built nuclear reactors that can be transported and installed at a site. Unlike traditional large nuclear plants, SMRs offer flexibility, reduced construction time, and lower upfront costs, making them attractive for countries with smaller grids or limited infrastructure. Companies like NuScale (SMR) specialize in this technology, which could be crucial for expanding nuclear energy access to emerging economies.

How does uranium mining relate to nuclear power plants?

Uranium mining is the first critical step in the nuclear fuel cycle. Uranium ore is extracted from the ground, then processed, enriched, and fabricated into fuel for nuclear reactors. Companies like Cameco (CCJ) and Uranium Energy Corp (UEC) mine this essential raw material. When countries build new nuclear plants, as in the Russia-Myanmar deal, it increases demand for uranium, potentially benefiting these mining companies through higher uranium prices and increased production volumes.

What is enriched uranium and why is it important?

Enriched uranium is uranium that has been processed to increase the concentration of uranium-235 (the isotope that can sustain a nuclear chain reaction). Most nuclear power plants require enriched uranium as fuel. Companies like Centrus Energy (LEU) specialize in uranium enrichment services, a technically complex and regulated process. As more countries build nuclear plants, the demand for enriched uranium fuel increases, creating potential opportunities for companies in this specialized sector.

What is the significance of the Russia-Myanmar nuclear deal?

The Russia-Myanmar nuclear deal represents a broader trend of emerging economies seeking energy independence through nuclear power. This agreement, where Russia's Rosatom will build a nuclear plant in Myanmar, demonstrates how countries are forming strategic partnerships to develop clean, reliable energy sources. For investors, it signals growing global demand for nuclear technology, fuel, and services, potentially benefiting companies across the entire nuclear supply chain as more nations pursue similar agreements.

What are the risks of investing in nuclear energy stocks?

Nuclear energy stocks face several unique risks. Regulatory changes can significantly impact operations, as nuclear power is heavily regulated for safety. Public perception and politics can shift quickly following incidents (like Fukushima in 2011). Projects often face delays and cost overruns due to complexity and safety requirements. Additionally, uranium prices can be volatile, affecting mining companies. Finally, competition from other energy sources like renewables and natural gas can impact growth prospects for the sector.

15 handpicked stocks

Moscow-Naypyidaw Nuclear Alliance

The recent nuclear deal between Russia and Myanmar highlights a growing trend of emerging economies turning to nuclear power. This collection features companies across the entire nuclear energy supply chain that could benefit from this expanding market, from uranium miners to advanced reactor developers.

Han Tan | Market Analyst

Updated 2 days ago | Published at juillet 1