The Future of Nuclear Energy
2008-01-10
By Keith Kohl
Like it or not, the world is going to have to deal with the issue of peak oil.
Unfortunately, it appears that time is going to come much sooner than expected. Considering that 90% of the world's largest oil fields have already entered into depletion, making up that production will become a monumental task for oil producers.
Mexico's Cantarell field, for example, is on its deathbed. Pemex (Mexico's state run oil company) reported in November that production at Cantarell is expected to decline 14% per year for the next eight years. Saudi Arabia's massive Ghawar oil field is already declining at a rate of 8% per year.
And that's not even the bad news . . .
The truth is that we'll never be able to accurately know when peak oil has passed (assuming, of course, that it hasn't already). The reason is simple enough: OPEC refuses to release data on their oil fields.
If we toss the question to President Bush, it appears he would agree with our bullish sentiment on nuclear energy. He recently referred to nuclear power as " . . . the best solution to make sure we have economic growth and at the same time make sure we are being good stewards of the environment." Granted, he may have just over a year before getting the boot, but we'll save politics for another day.
On Thursday, England is expected to release the details on the country's nuclear power program. There's a good chance the British government could beef up the country's nuclear reactors with newer and more powerful ones.
If a nuclear future is on the horizon, how long could it last?
I wouldn't expect to see nuclear power ever taking over 100% of the world's energy needs, especially with the significant advances that renewable technology has achieved lately.
But if we're going to be realistic here, then we can't possibly assume renewables will be able to supply enough energy on a global scale before oil is gone.
When it comes to our future energy demand, it's impossible not to talk about India and China. After all, both countries are growing astronomically.
So what are they looking to use to fuel their energy needs?
The Nuclear Revival
China is going to the ends of the earth to find its next source of fuel. In fact, its already going beyond that. The country's latest mission to the lunar surface is expected to bring back helium-3, which has the potential to fuel a nuclear reactor. This is some serious power, too. There's enough helium-3 reserves on the moon to power the earth for tens of thousands of years.
India, on the other hand, has set its priority on a different fuel: thorium. Unlike the Chinese, they don't have to go anywhere to find it. India boasts over 13% of the world's thorium reserves.
The problem is that thorium can't be burned in a reactor unless it has been converted into Uranium-233 (U-233). But thorium seems to be the next step for nuclear energy, since it's more abundant than uranium.
Investing in the Nuclear Revival
Even though the use of thorium as nuclear fuel is still a long ways off, investors like us don't need to sit on the sidelines.
There are a few options today. Let's look at Thorium Power (OTC: THPW), for example. As you can see below, the company has performed admirably over the last three months:
Thorium Power is involved fuel designs for both existing and future nuclear reactors. As nuclear energy starts to play a bigger role in our world's energy picture, these guys already have a foot in the door.
Until next time,
Keith Kohl
www.energyandcapital.com
P.S. There's going to be trillions of dollars invested in our energy infrastructure as peak oil becomes a reality. Most of my readers are already profiting from the energy bull market. Perhaps you should join us. If you're interested in checking it out, please click here.
energyandcapital.com
www.energyandcapital.com |
