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A Safe Nuclear Reactor?

Written by Luke Burgess
Posted June 25, 2018 at 3:03PM

Don’t believe your politicians...

The threat of a nuclear war is still very real.

President Trump has done a good job convincing his voter base that he’s making progress with North Korean relations.

But the fact is, North Korea has promised denuclearization dozens of times in the past. Why should we believe them now?

We shouldn’t.

Nor should we trust what our own politicians say.

On June 13th, President Trump tweeted, “There is no longer a Nuclear Threat from North Korea.”

But just 10 days later, Trump renewed sanctions on North Korea, citing an “extraordinary threat” from its nuclear weapons.

Only time will tell how it will all work out.

But as the rhetoric and fear surrounding nuclear weapons and energy research continues to build, investor interest may begin to grow around a little-known nuclear fuel: thorium.

What the heck is thorium?

Thorium is one of the basic universal elements, like hydrogen and gold. It’s a radioactive material that’s closely related to uranium. And like uranium, the metal can be used to fuel a nuclear chain reaction to power plants and make electricity.

Right now, the main applications for thorium are filaments and heat-resistant ceramics. But thorium's most important application is its potential use in nuclear energy.

Why’s that?

Well, the science is a bit above my pay grade here, but the short of it is this...

Current nuclear reactors are fueled by uranium or plutonium and cooled by water or liquid metal. These reactors can also be used to produce material for nuclear weapons.

But a different type of reactor, one cooled by molten salt, does not create good material for bombs. And the best-known material for running one of these molten salt reactors is thorium.

Now, molten salt reactor technology is still in development. And there are currently no nuclear reactors fueled by thorium.

But using thorium as a fuel to run a nuclear power plant has an important geopolitical angle that will be more and more important in the future. And as the media increasingly focuses on nuclear geopolitics, future options like thorium-fueled molten salt reactors are likely to be discussed more.

This could lead to a significant boost in investor interest in thorium. Right now there’s virtually none.

Investing in thorium, however, can be tough. Obviously there’s no owning the physical metal, and there are no thorium ETFs or futures.

The thorium market is closed to all but a handful of industrial traders. And only a few public companies explore for and produce the nuclear fuel.

There are one or two small junior companies focused on exploring for thorium. But companies with the largest thorium assets are large uranium miners. Companies like Cameco Corp. (NYSE: CCJ) are mining uranium in areas that also have concentrations of thorium.

Thorium-fueled molten salt reactors are still a long way from commercial application. But they are a much better option to allow possibly hostile nations to develop since they can’t produce good material for nuclear weapons.

Continued geopolitical distress may eventually push leaders to seek safe nuclear alternatives. Even though the technology is still years away from perfection, thorium-fueled molten salt reactors may be a big part of those alternatives. And that could lead to profits for the well-positioned investor.

Thorium could be the nuclear fuel of the future. Keep a close eye on it.

Until next time,

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Luke Burgess

follow basic@Lukemburgess on Twitter

As an editor at Energy and Capital, Luke’s analysis and market research reaches hundreds of thousands of investors every day. Luke is also the investment director of Angel Publishing’s new Secret Stock Files newsletter, which helps investors leverage the future supply/demand imbalance that he believes could be key to a cyclical upswing in the hard asset markets. For more on Luke, go to his editor’s page.


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