Joe Reagor: We provide management access to our client base and provide exposure for the smaller-cap companies that are somewhat under-covered by the Street.
TMR: How would you sum up the sentiments of the participants?
JR: In the mining sector, I heard a bit of cautious optimism. Conditions seem to be improving, but the strength of the U.S. dollar is not helping most commodity prices. However, if you operate outside of the U.S., margins are improving.
TMR: With all the concern about a possible stock-market bubble, was there perhaps a feeling that miners may be due for a revaluation because they produce things of tangible worth?
JR: There has been more generalist interest in mining recently because of the fear that the broader market is getting a bit frothy in certain sectors.
Second, energy prices rose quickly in the 1970s due to the OPEC oil embargo, coal industry labor problems, and natural gas supply shortages. These high prices led to improvements in energy efficiency and a declining demand for energy. After many years of 7% annual increases in electricity demand, annual growth fell to only 2% by the late 1970s.
Since nuclear plants were large, often more than 1000 MW each, a slowdown in demand growth meant they were underutilized, further aggravating the debt burden on utilities.
Third, an increase in energy prices triggered an increase in inflation. High inflation meant high lending rates. Utilities deep in debt from nuclear plants saw interest rates rise, and were forced to raise electricity prices.
Mining and refining: lithium, powering the future with brine
China has a pause on new approvals in order to revisit its regulatory system. I’m sure India will take a look, and nuclear is politically controversial in India.
One place I’ll be interested in watching is the UK, where there is a governing coalition between the – essentially between the right the liberal left. One of the key points of disagreement when they entered that coalition was over the future of nuclear power.
They agreed to disagree. It will be interesting to see whether they can continue to do that.
LUDDEN: All right. Let’s bring some callers in. Nat is on the line from Buffalo, New York. Hi, Nat.
NAT (Caller): Hi, how are you?
LUDDEN: Go right ahead.
Good. Go right ahead.
Nuclear can get us there.
Fossil fuels have high emissions. Natural gas emissions are lower than some, but there are still emissions. But some renewable sources are too expensive to match the cost-efficiency of conventional sources.
Nuclear power is cheaper than conventional power.
And it has zero emissions.
A Worldwide Phenomenon
As I said before, 31 nations across the globe have nuclear reactors.
In those 31 nations, there are a total of 434 nuclear reactors and a total capacity of 372,000 MWe. But plenty more nations have either planned or proposed reactors expected to be online by 2030.
As of August 2012, 65 reactors were under construction with a combined capacity of 64,979 MWe.
In DLE, brine is pumped from underground sources, but instead of concentrating the brine by open evaporation, lithium is removed from the brine using a number of chemical and physical methods. One method is ion-exchange adsorption, where the brine is mixed with an absorbent material that preferentially binds lithium compounds over the other compounds in the brine. One class of sorbents used in DLE is known as layered double hydroxides (LDH), materials with a layered structure that allows lithium chloride in the brine to fit between the layers while excluding the potassium, magnesium, and other salts.
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Nuclear Regulatory Commission (NRC) regulates the operation of nuclear power plants.
Radioactive wastes are classified as low-level waste or high-level waste. The radioactivity of these wastes can range from a little higher than natural background levels, such as for uranium mill tailings, to the much higher radioactivity of used (spent) reactor fuel and parts of nuclear reactors. The radioactivity of nuclear waste decreases over time through a process called radioactive decay.
The amount of time it takes for the radioactivity of radioactive material to decrease to half its original level is called the radioactive half-life. Radioactive waste with a short half-life is often stored temporarily before disposal to reduce potential radiation doses to workers who handle and transport the waste.
First off, it requires vast amounts of water to create the brines in the first place, and because evaporation ponds are only practical in places where it doesn’t rain much, water is already in short supply. The water used for brine mining is also lost to the atmosphere, coming back to the surface somewhere far from the evaporation ponds. Plus, the evaporation ponds occupy unbelievably large amounts of land — some pond complexes cover an area the size of Manhattan — which makes it difficult to scale up operations.
And the amount of time it takes the sun to do its work is a problem in terms of production flexibility.
A Better Way
To make the most of brine mining while mitigating its shortcomings, direct lithium extraction methods are becoming increasingly popular.
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So if we sort out the safety side, we still don’t know whether people will want to build these.
LUDDEN: But now the Bush administration had hoped to increase use of nuclear power and President Obama has invested funds to expand it further. Tell us about that.
Dr. LEVI: There has been growing interest in nuclear power across the political spectrum. Republicans have traditionally been enthusiastic about nuclear and President Bush’s position reflects that. Democrats have become increasingly positive toward nuclear because of their concern about climate change. We have a variety of options, of possibilities down the road, for zero carbon, zero emissions generation.
ZEMAN: Oh, well, the environmental costs with uranium mining really have to do with two things. One, tailings disposal, and tailings is the sort of leftover material after you get the ore out. And modern mines tend to build dams to keep them keep the tailing wet so that they don’t fly around in the dust.
And the second is at the shaft. Do you have water leaking into the shaft and then flowing out?
So I mean, mining isn’t perfect and you tend to make a big mess. That’s why they tend to be in far-flung places. So it’s a very localized cost in some ways, but it adds up, is what I would say.
LUDDEN: And Michael Levi, is there plenty of uranium out there?
Dr. LEVI: There is plenty of uranium out there. Look, we’re going to run out of uranium sooner than we run out of the sun and the wind.
Earth’s crust, and gigatons are dissolved into the oceans of the world, lithium is very reactive and thus tends to be diffuse, making it difficult to obtain concentrated in the quantities their businesses depend on.
As the electric vehicle and renewable energy markets continue to grow, the need for lithium to manufacture batteries will grow with it, potentially to the point where demand outstrips the mining industry’s production capability. To understand how that imbalance may be possible, we’ll take a look at how lithium is currently mined, as well as examine some new mining techniques that may help fill the coming lithium gap.
A Rocky Start
Although lithium has been known and well-characterized by chemists since the early 1800s, it was only in the middle of the previous century that commercial uses for lithium compounds were identified.
State utility commissions, who paid little attention to utility finances in an era of declining rates, were suddenly keenly interested in utility decisions about power plant investments.
Fourth, critical utility commissions were less likely to pass on all investment costs to utility ratepayers. In New York, the commission ruled that a quarter of the cost of the Shoreham nuclear plant was not “prudently incurred,” and forced a loss of $1.35 billion on utility stockholders. Investors quickly became leery of risky and large investments in nuclear power.
Fifth, public opposition to nuclear plants gained steam in the 1970s.
Plants at Seabrook, New Hampshire, and Shoreham, Long Island, were the focus of intense anti-nuclear protests.