My Energy is Ur Energy...

...literally, and maybe it should literally be your energy too. This seems to be one of the few uranium companies who have not seen a dramatic run-up in its share prices relative to its reserves. Now this does not mean that the stock has not seen any appreciation, which it has...went from the low $1's to a recent high of $2.17...but this company is still undervalued. Most companies trade at price relative to their resource in the ground...Ur Energy does as well, but what makes this stock stick out is that there are 2 pounds in the ground for every share! Think about that...that means that this company is trading at $1 per pound...in our opinion that makes this stock grossly undervalued considering that the recent spot on uranium (per pound) was $40.25.

This company has its major holding in Wyoming (a state where the Governor recently declared that, "we are open for business" when asked the state's stand on uranium companies setting up shop). This is extremely bullish in that now the state permits will not be "hard" to get due to a reluctant state government trying to delay a project. Also the residents of this Western state seem to be overwhelmingly in favor of the jobs that will be created from new mines. The company has 9 properties in Wyoming with 2 being major reserve containing properties. These two properties are Lost Soldier and Lost Creek...both properties contain significant drill holes and the company is going through and confirming all the information from historical data by performing their own drill program. It must also be noted that the company recently purchased the historical logs to one of its properties, although we do not know from which company they purchased these results from or for which property. For these two properties, there are two important reasons to be excited, because although the historical results are not NI 43-101 compliant, the historical owners are Cameco (which drilled in 1998) at Lost Soldier and Conoco-Texasgulf (1978) at Lost Creek. Cameco estimated that Lost Soldier had 26.6 million pounds in the ground and Conoco-Texasgulf estimated 12.8 million at Lost Creek. The gem in all of this could potentially be Radon Springs, another one of the companies projects. Texasgulf was the historic operator at this site (drilled in '78 as well) and reported 34.3 million pounds with an average grade of .02%. So the company will most likely be using in-situ mining (drilling and pumping out a liquid-like substance) which is cheaper than open pit mining, less labor intensive, and much more environmentally friendly. This is also the only economical way in which this company will be able to get the uranium out of the ground and to market. This is our most recent buy and we are quite confident that as the year 2008 approaches (the year in which their first mine will open) the stock will climb in anticipation. This is a company that must be bought and then held for the long term, because the way we see it is that some very good gains may be realized before the mines begin to open, however after they start to monetize their resources the stock will shoot up further (we also anticipate that the price of uranium will be much higher as demand grows in the years ahead).

Updating you on our recent picks, Canwest has been setting new highs...today backing off an all-time closing high at $8. We still fully anticipate CWPC to hit our price target of $10 before the year is over, realizing that we may have been too conservative in our analysis we may actually be surprised should this stock shoot above $10 before the year is over...at which time we may swith our concensus (depending on the news) to a higher price. However, at this time we believe that the company has entered a window where the price will stagnate as a result of consolidation in its stock price. All indicators are positive with increased volume as the stock rose higher and higher. So our thinking is that it will present you the opportunity to buy within this window...we are not sure how long this window will be open but our best guess is 5 weeks which will be about the time they gain their listing on the AMEX stock market. At that time we believe the company will release its drill results, that are long overdue, in order to gain some recognition for the company and develop a following. After those events the next event will most likely be the announcement of their reserves or a strategic partner entering into the equation, when it comes to these two events your guess is as good as ours.

Canalaska and the other junior uraniums have mostly been calming down a bit and consolidating, with the exception of Paladin which has been on a tear recently after the announcements of contracts. This is a group that you must have patience with so as not to sell and take the quick profits because for those who wait it is our belief that you will be richly rewarded (we are keeping all of our shares). Should you take profits now you risk missing out on the next unforseen rally...the last one being set off by an unexpected purchase of a private company by Hathor, and then you will be forced to buy in at a higher price. My belief is that riding out the ups and downs with a basket of these companies is safer than taking the risk of trying to "trade" a basket of these stocks (plus keep in mind the capital gains-short term- that will be accrued by this strategy). HOWEVER, NO ONE EVER GOT HURT TAKING PROFITS!

We see an opportunity to buy more shares in these stocks right now as they should cool off. Take note that Strathmore and Canalaska have drilling programs going on right now on some very promising properties. I just spoke to representatives at Canalaska today and they assured me that although their press release stated they had been behind on their drill program, they are currently on schedule and fully expect to release their results in mid-April. After wathing the stock fall sharply down on this press release we called, but still cannot figure out why they released this information if it was a mute point. It seems to have confused many people and probably would have been left untouched. So with these two stocks we must patiently wait until at least mid-April for any news about potential reserves as is the same with Titan Uranium. Be patient with these stocks and the potential reward could be quite gratifying.

Now we have noticed that Cameco and International Uranium have been stagnate, and in both cases actually down. We have had some concerns with those who are worried about "The Uranium Movement" and its strength with its 800 pound gorilla not actively participating in the general uptrend. Our view is that this large cap is consolidating and that many investors sold this stock for the same reason they bought the juniors...if merger activity picks up (we anticipate this to pick up in the second half of next year) then Cameco will be a buyer which will put pressure on its shares while lifting the companies with a chance of being bought out. Same case goes for International Uranium which has a market cap nearing $1 billion.

With that being said we believe that Cameco will eventually have to pay dearly for its folly in not grabbing promising land holdings when uranium prices were lower. You could argue that hindsight is 20/20 or better, however it simply does not make sense not to add a "buffer" between your large producing mines and the land beyond. This could have been done for nearly nothing, however in the years ahead we see Cameco and Cogema (owned by French nuclear conglomerate Areva) moving from their god-like status in the uranium sector today to more mortal status as "The Uranium Movement" continues to progress. What is more...when (notice we did not say if) the Australian government opens up for business, many of those companies invested over their will be able to construct their mines and infrastructure and in a year, or few short years, become large producing companies themselves. Due to this we believe that Cameco should be a holding in your portfolio, however we would like to have more invested with the juniors in order for the potential to have higher gains.

Recommendations:
3/28/2006

Ur Energy-------UREGF-------US$1.73*

*-Denotes a company we own shares in before the publishing of this article on the blog.

Nothing But Good News

Well this week so far has turned out to be very interesting, and good to those who were able to buy our before mentioned stocks. Canwest on Monday shot up on the release of more good drill results as well as a report that focused on the company and a speech by a Saskatchewan official speaking on the tar sands in the province. I believe it is apparent now to all that with the future listing of this stock on the American Stock Exchange pending and most likely to be approved (come on the stock trades over a million shares a day, and has a powerful uptrend) the stock should have no problem reaching $10 per share. In fact it could do this much quicker than we anticipated once it is listed because now mutual funds will be able to purchase the stock, and there will be those who will get burned by trying to be intelligent by shorting the stock. My view is that this company is a train traveling down a mountain at full speed (we all know how long it takes trains to come to a halt!) as opposed to a car. The only way the forward momentum on this stock is halted...or the upward trend is broken...will be for a steep decline in the price of oil or some unforseen political event in Saskatchewan. Ultimately after the company has completed its drilling program I believe that one of two events will occur:
1.) that it will be purchased by either an Indian or Chinese entity
2.)the company will sell part of its concession at a very rich price in order to move forward with development

Currently our stand on the stock is that you should ACCUMULATE by buying ON THE DIPS. We also believe that this stock will still hit $10 by the end of the year, and look forward to its listing on the AMEX.

Now a second surprise-they seemed to come in pairs this week- was that some of our uraniums shot up dramatically on Monday. There was not any news coming out of any of these companies around this time so we should give credit for this steep rally to the recent acquisition of Roughrider Uranium Corp. (a privately held junior exploration company) by Hathor Exploration. This deal was announced on Friday, promplty sending shares of Hathor higher by 100%! A double...in one day...on an acquistion! Plainly a bullish sign for this sector, because it tells me that investors view these purchases as "cheap" (thus the sharp rise in the acquisitor's shares) and necessary in order to achieve mass scale in and industry that could be labeled-dare we say- oligopoly.

CanAlaska (CVV.V or CVVLF) shot as high as 30% on Monday before settling in at around the 20% level. This is due to their portfolio of landholdings that mirrors Roughrider's, however it must be noted that their properties are larger by acreage, and APPEAR to be in more desireable areas (in other words closer to existing mines and "on trend" with them as well).

Another one of our recommendations, Strathmore Minerals (STHJF), is very similiar to CanAlaska in that they are land rich. However, Strathmore has over 100 million pounds of Uranium in the ground that is a historical resource. Now they only need to develop this in order to begin taking advantage of the high price of uranium...however the more they discover within the ground the more they will be worth in the marketplace.

There will be more to come on all of these companies, but today I wanted to take some time to explain the recent dramatic run-up in some of these stocks. At this point we we would be holding our small uranium companies and wait to buy more on a dip. It is not advisable to sell your shares and hope to rebuy at a lower level as bull trends are just that...trends that move from the lower left to upper right and no one can really tell when there will be a breather. So lets keep our exposure to these companies at this time, and add to our positions periodically.

It is our opinion that CanWest is a stock that can be bought all the way up to $7.50 and at that point we will review our options based on what has, or has not, happened to further decide our best options.

-theinvestar's Portfolio:
Past Recommendations

Canwest Petroleum*----------CWPC---------US$4.90_______+$1.53 or+33.22%
Cameco----------------------CCJ------------US$35.91_______-$1.42 or -3.95%
International Uranium-------IUCPF---------US$5.45________-$.26 or -4.77%
Paladin----------------------PALAF---------US$2.77________+$.28 or +10.11%
Strathmore Minerals---------STHJF---------US$2.25_______+$.22 or +9.78%
Canalaskca Ventures*---------CVVLF--------US$.449_______+$.071 or +15.81%
Titan Uranium--------------TUEFF----------US$2.11_______+$.14 or +6.22%

*Denotes a Company in which I currently own stock in before this article has been posted on the blog.

The Uranium Movement

For as long as I have invested in the stock market I have discovered that there are many truisms:
1. There are always bull markets out there to be discovered
2. Many investors do not get into these bull markets until the crowd is rushing in
3. After these investors do get whiff of a new bull market they will inevitably pump stocks up too much in a heated bull market
4. These same investors will then dump those same stocks once a 'bubble' has popped as has happened during every market correction over the past 30 years
5. There are times when there is a hot market and other times when there are hot stocks
6. There are investing markets and trading markets
7. And most importantly it must be noted that ALL markets are bull markets...you just have to be on the right side of the trade...in a bull market go long, and in a bear market you must go short in order to make a penny

So with the recent news that the US government has assured India that they will 'secure' uranium supplies for that country in the future, it is our conclusion that the next bull market has already started in the Uranium Industry. Many have thought that the US would simply shift from coal to oil to natural gas and then focus on the tar sands in the Athabascan Basin, and eventually someday go back to nuclear power which was mostly abandoned in this country in the early 80s. However now with Iran and Venezuela increasingly daring the US to sanction them economically, the instability in Nigeria and Iraq, countries such as India and China grabbing the most promising future oil fields for their personal economic/military uses, increasing terrorist attempts to attack what I will dub "Old Energy" infrastructure in the Middle East, and real evidence that global warming is starting to become a serious problem many are now realizing that it is now time to invest in new nuclear power plants (which are an amazingly and increasingly clean source of energy).

Now some of you who have read my other posts might be thinking that with the government footing more than 100% of the bill for these plants of the future that those utilities would be a decent investment, and maybe they would be, but if our logic is correct we would prefer to have truckloads full of cash coming in as opposed to a wheelbarrel. Instead lets apply what we now see as a trend upwards...Uranium has already moved from $7 a pound to $40 a pound recently...and start to move some of our money into Uranium Mining Stocks. Many of these companies own historical deposits, or deposits already discovered but abandoned after the meltdown in the nuclear industry in the late 70s and early 80s. Other companies have very promising land holdings that are located in stable countries and are currently drilling in hopes of discovering the next McArthur Lake (the richest Uranium Mine to date).

Most of these stocks are microcap stocks, and whenever investing in sectors which are dominated by a few major players (Cameco, Areva/Cogema, and Dennison) you MUST spread your risks among many stocks and then move your money from the losers to the heir apparents to dominate the industry. So today I shall start a reader's Portfolio which I will justify in following letters.

-theinvestar's PORTFOLIO
Recommendations on 3/20/2006

Cameco-----------------CCJ---------US$35.91
International Uranium--IUCPF------US$5.45
Paladin------------------PALAF-----US$2.77
Strathmore Minerals----STHJF------US$2.25
Canalaska Ventures-----CVVLF------US$.449*
Titan Uranium----------TUEFF------US$2.11

Past Recommendations

Canwest Petroleum-----CWPC-------US$4.90*______(so far a profit of $.10 or 2%)

*Denotes a Company in which I currently own stock in before this article has been posted on the blog.

Expansion in the Nuclear Industry

So the recent big news out of rural South Carolina is that Duke Power and the Southern Company, two of the nation's largest utilities, will be building their proposed nuclear power plant on a Cherokee County site (located in the northern portion of the state, near Charlotte). This site was previously approved for a nuclear power plant, but then abandoned in 1983 after it was apparent that the southern United States would not need the excess power that that proposed plant would have produced. This should make the approval process much smoother and quicker as opposed to an altogether new site. This will be about a $5 billion project and will take about a decade to complete the entire process from approval to final construction. This is the second plant announced for the state of South Carolina, with the other one being announced in February by SCE&G (a subsidiary of SCANA) and Santee Cooper (the state utility in South Carolina) at the V.C. Summer plant in Jenkinsville, SC. Both projects appear that they will be a windfall for the companies mentioned due to the recent rumors that the Federal Government will be offering incentives totaling 110% of the total cost incurred by the utilities to complete these plants.
In related news pertinent to this topic, Progress Energy stated in January that it will be adding another reactor to its plant outside of Raleigh, where the company maintains its headquarters. So it now appears that the South will lead the nation in adding new electrical output for growth. However, much more importantly all of this new capacity will be the cheapest electricity in the nation so long as oil and natural gas prices keep their forward momentum. These are the first in what appears to be a movement into cheap energy alternatives, and look for other utilities to move ahead with plans to construct these plants- and in the south where these projects are viewed as an economic plus and not politically opposed.

Canada's Gold Rush

Since the high oil prices have hit the world markets Canada has seen a frenzy develop in its Alberta and Saskatchewan provinces. For this post we will focus on the tar sands in Alberta and the suspected tar sands in Western Saskatchewan. Many people have decided to play the potential of this region through Suncor or Birch Mountain (a recommendation by Mr. Jim Cramer form CNBC'S Mad Money). These two companies focus on the Alberta region and in the case of Sucor already have producing assets. Tar sands can be gathered in different ways, but the two most common are open pit mining and a process in which natural gas is used to heat up the bitumen (the oil containing sands) until the oil melts and can then be pumped up to the surface. The cheapest method is open pit mining, but with high oil prices natural gas is a viable alternative because usually that process can be performed at the $25 per barrel range max. Another company which I am going to recommend right now is Canwest Petroleum (CWPC) which I do own shares in and have owned shares in for the last 5 months. It has been good to me and I have no intentions of selling. Canwest is positioned very well in this region possessing two very promising concessions. They own 100% of Eagle's Nest located in the Northeast area of Alberta (a recent concession the same size sold to ChevronTexaco for $35 Million) where drilling will commence once the company finishes its drilling on Firebag East. Firebag East is the first tar sands project in Saskathewan and so far the drill results are very promising. Firebag East is located to the East of Suncor's huge Firebag field. I am recommending CWPC at its current price of $4.90 and a price target of $10 by the end of the year.