Uranium Stocks Plummet On Fears Following Japan Reactor Incident

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CALGARY -(Dow Jones)- Uranium stocks plummeted Monday after several Japanese
reactors overheated and may have suffered partial meltdowns as a result of a
devastating earthquake and tsunami that knocked out their cooling systems.


Analysts said uranium equities are falling because they had been pricing in
strong growth in demand as countries across the world plan to build new fleets
of nuclear power stations to manage their energy needs. But those growth
assumptions may be overstretched if public sentiment turns against nuclear power
following Japan's problems.


Shares of Cameco Corp. (CCJ), the world's largest publicly owned uranium
miner, dropped 17.9% to $30.68 in recent trading on the New York Stock Exchange.
Denison Mines Corp. (DNN) shares dropped 21.9%.


Uranium One Inc. (UUU.T) shares dropped 25.5% and Australia's Bannerman
Resources Ltd. (BAN.T) dropped 25.7% in recent Toronto trading.


In the U.S., some lawmakers have already begun calling for curbs on nuclear
power development. Rep. Edward Markey (D.-Mass) issued a statement Sunday
calling for a moratorium on the construction of new nuclear power plants in the
U.S., saying that a similar nuclear accident could happen in the U.S.


"Fingers may be pointed at the nuclear industry," Dundee Capital Markets
analyst David Talbot told clients, saying that there is a risk that development
plans in the West will be halted - although he said that China, India and
Russia, which account for about half of the expected growth in nuclear power
plants, aren't likely to curb their building as a result of Japan's problems.


So far, the three Japanese reactors experience cooling problems haven't
released significant amounts of radiation, but the situation is dangerous, as an
explosion Monday morning in Japan damaged a pump bringing in cooling seawater at
one reactor and a third reactor began experiencing cooling problems Monday
afternoon.


Talbot said that so far the destruction of a hydroelectric dam and damage to
an oil refinery in the country have done more damage to the surrounding
environment than the nuclear reactors, but uranium miners are still more
vulnerable to public fears about nuclear power.


"It could take some time for the sector to stabilize as the world realizes
that the worst case scenario likely won't be achieved," he said.



-By Edward Welsch, Dow Jones Newswires; 403-229-9095; edward.welsch@
dowjones.com