Last year, Rick Rule, well-known mining investor and President and Founder, Rule Investment Media, said the easy money in uranium had been made.

But things change, and the uranium price is doing some interesting things in 2022.

Last month, the uranium spot price hit an 11-year high of US$65/pound – the magic number often touted by uranium players that would push them to get into production – before plunging back below $US50/lb. Stocks followed.

The word ‘whipsawing’ comes to mind.

Uranium spot price over the past 5 years. Pic: Trading Economics

And yet the medium to long term outlook for the nuclear fuel remains extremely positive, says Rick Rule, in a recent interview with Stockhead’s Oriel Morrison.

“The incentive price for new production of uranium with inflation in the supply chain is $US75/lb,” Rule says.

“Given [the world is] using 180 million pounds and producing 120 million pounds – meaning that there is a 60 million pound per year shortfall – it’s pretty simple to figure out that over the five-year time frame that the price of uranium needs to go through the incentive price of $US75.

“Either that, or the lights go out. Those are the only two choices.

“Which of those happens? I suspect that the price of uranium goes up.”


Will uranium price jump immediately?

Maybe not, but investors who are confident of the uranium bull market thematic should hold their nerve.

“Could the price of uranium go from $US48/lb to $US40/lb first?,” Rule asks.

“Absolutely. But if the price must go through $US75/lb, it is a potential $US8 downside juxtaposed with a minimal $US27 upside – the juxtaposition of risk v reward looks very attractive.”

This where the psychology of investing comes into play. Rule often talks about how he bought into Paladin Energy (ASX:PDN) at 10c per share back in the mid-2000s.

It went down to 1c … then all the way to ~$10 a share, creating fortunes in the process.

The first time Rule and Morrison spoke about the uranium price three years ago it was at $US18/lb.

“When people say the uranium price is down, I suggest they take a look at history,” Rule says.

“The price has either increased from $US18/lb to $US48/lb, or it has declined from $US65/lb to $US48/lb. That really depends on your point of view.

“From my own point of view the uranium price is up nicely and given that I am looking to add substantially to my uranium position I am delighted to see it lower in price.”


Which uranium stocks does Rick Rule like?

Rule follows 75 uranium listings world-wide, including many in Australia. Of that, he has a shopping list that is limited to 12.

“We think that maybe 50 listings in the uranium space worldwide are unviable at $US100/lb,” Rule says.

“So, people that are participating in the uranium space need to be particularly concerned about viability.

“There are certainly Australian listed companies – Lotus, Paladin, Boss, Deep Yellow – that I think are excellent speculations.”



LOT’s 43.6Mlb ‘Kayelekera’ project in Malawi – purchased from fellow Africa-focused Paladin Energy (ASX:PDN) in March 2020 – will cost just $US50m to get up and running, the company says.

Kayelekera is a proven uranium operation having successfully produced 11Mlb over five years, ceasing operations in 2014 due to sustained low uranium prices.

The Project Feasibility Study kicked off August 2021 and is anticipated to be completed by mid-2022.



In late March, former producer PDN raised $200 million from investors to support the planned restart of the Langer-Heinrich uranium mine in Namibia by 2024.

The project, which was placed in care and maintenance in 2018, has a low-cost pathway back to production.

A restart plan previously released by Paladin estimated it would cost US$81m to restart operations, producing at its peak 5.9Mlbs of U3O8 annually at Life of Mine C1 costs of US$27/lb.

With a total mine life of 17 years, that looks very economic at Rule’s incentive price of $US75/lb.



In early June BOE formally announced plans to rebuild the Honeymoon uranium mine in South Australia.

Boss flagged the final investment decision in March with a $125 million share placement which, along with a strategic uranium stockpile of 1.25Mlb worth an estimated US$59.38m, should help fund it into production.

The 2.45Mlb per annum yellowcake mine, which will cost around $113 million to construct and refurbish, will be just the third operating in Australia alongside BHP’s (ASX:BHP) Olympic Dam and the privately owned Beverley mine, also in SA.

Boss plans to be in production by the fourth quarter of 2023 with a three-year ramp-up to its full production rate, timed for a looming nuclear supply shortage expected from 2024.

Honeymoon is set to operate for an initial life of 11 years, with an IRR of 47% at a uranium price of US$60/lb.



DYL boss John Borshoff is the geologist who founded Paladin Energy in 1993, before taking it from a junior explorer to a $4bn uranium mining company with two operations – ‘Langer Heinrich’ in Namibia, and ‘Kayelekera’ in Malawi.

In October 2016, Borshoff joined then-$10m market cap uranium explorer DYL as managing director and chief exec.

Deep Yellow, which has three uranium projects in Namibia – Reptile, Nova and Yellow Dune — is now one of a select group of ASX uranium stocks set to enter production once the impending boom hits.

In February this year, a PFS was completed on a ‘Langer-Heinrich-style’ 3mlb per annum open-pit mining operation at the ‘Tumas’ project at Reptile.

Then, in March, DYL announced it had secured support from the board of Vimy Resources (ASX:VMY) for an all-scrip takeover worth $658 million that will increase the chances of developing Vimy’s “world class” Mulga Rock uranium mine in WA.

NOW READ: Demand is assured, supply is not’: Deep Yellow’s John Borshoff on why the uranium sector is in ‘a broken-down state’


Rick Rule was interviewed on Stockhead’s Latest V-Con on Uranium. The conference and full interview can be viewed here.

Rick is presenting at the Rule Symposium Natural Resource Investing conference Jul 26-29 Boca Raton, Florida. Tickets are available here.