Welcome to the big time: A-Cap added to Global X Uranium ETF as investors eye Letlhakane riches
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A-Cap Energy has been included in the Index Composition for the Global X Uranium ETF (NYSE:URA) – joining one of the world’s best known and largest uranium Exchange Traded Funds (ETFs).
The EFT has net assets of around US$1.18 billion and provides investors with exposure to companies engaged in uranium mining and the production of nuclear components.
Global X Uranium ETF has a 13-day window following its announcement on 25 January 2021 to accumulate its weighting in A-Cap.
A-Cap Energy (ASX:ACB) deputy chairman Paul Ingram said the company’s inclusion in the ETF was a vote of confidence in its flagship Letlhakane Uranium Project in Botswana which hosts one of the world’s largest undeveloped uranium resources – 365.7 million pounds of contained U3O8 (100ppm U3O8 cut-off).
“Amid rising global recognition of nuclear energy as a means to facilitate the world’s decarbonisation, we’re pleased to see A-Cap securing recognition for Letlhakane’s value and potential,” he said.
“Investor sentiment is growing strongly, as demonstrated by rising uranium prices and the influx of funds into uranium ETFs over the last few months.
“Supportive market momentum has bought forward planning for drilling and metallurgical testwork at Letlhakane that is geared to enhance the project’s value while reducing capex and opex.”
The company is gearing up to restart Letlhakane and plans to kick off a work program this quarter to re-work the previous studies, bring them up to date and gear up to get the project running.
And it could be perfect timing, with political unrest in Kazakhstan – where around 43% of the world’s uranium comes from — predicted to send uranium prices soaring.
Uranium sector-specific exchange traded funds powered right up earlier in January as escalating protests in Kazakhstan threatened the major global source of uranium exports.
Among the best performing non-leveraged ETFs on the news, the North Shore Global Uranium Mining ETF (NYSE: URNM) rose 2.2% and Global X with its diversity and quality advanced well over 17%
The price for the product is currently sitting around US$44 a pound and Ingram reckons that once it hits a stable $60, there’s certain to be a lot of action in the uranium space.
This article was developed in collaboration with A-Cap Energy Limited, a Stockhead advertiser at the time of publishing.
This article does not constitute financial product advice. You should consider obtaining independent advice before making any financial decisions.