Canadian junior Bedford Metals (TSX-V: BFM) has secured an exploration permit for its Ubiquity Lake uranium project in northern Saskatchewan, Canada.
The licence allows Bedford to start field activities to validate the targets identified in previous surveys.
The planned prospecting program will include investigating and mapping historic showings and target zones identified through successive geophysical programs, the company said.
Given the project’s proximity to the southern tip of the Athabasca Basin, the Vancouver-based company is pursuing an exploration model similar to Fission’s Patterson Lake South deposit and NexGen’s Arrow deposit.
Bedford Metals is simultaneously advancing its Close Lake uranium project, located on the eastern side of the Athabasca Basin, by claims held by Cameco (TSX: CCO) (NYSE: CCJ), the world’s second largest uranium producer.
The granting of the exploration permit for Bedford comes amid favourable market conditions. Uranium contract prices have reached over 16-year highs due to supply uncertainty and increased demand from utilities seeking to secure the radioactive fuel to rapidly expand their capacity to power growing AI data centres.
Term prices are now around $79 per pound, the highest since 2008, and are expected to increase further in the coming months.
The commodity, which fuels nuclear reactors, has benefitted from renewed interest in building global nuclear capacity. This is partly due to the push to switch to greener power sources, but also a consequence of inflationary pressure.
Prices may not remain this high, analysts say, as Kazatomprom, the world’s largest uranium miner, is set to resume full production next year. The move will end production cuts adopted during uranium’s prolonged bear market following the Fukushima nuclear disaster.
Cameco is looking to ramp up its McArthur River operation in Canada. This will add a further 6,900 tonnes of uranium to the global feedstock.
Other important actors are also increasing output. Australia’s Paladin (ASX: PDN) announced first commercial production from the Langer Heinrich uranium mine in Namibia in April, after having the mine idled for six years.
The good news is that the International Atomic Energy Agency predicts that global demand for uranium will exceed 100,000 tonnes per year by 2040. This is more than double the present worldwide production.
Currently, two-thirds of the world’s uranium comes from Kazakhstan, Canada and Australia.
