(Kitco News) - The global energy crisis continues to threaten the global economy, and according to one mining executive, any solution to the growing problem must include nuclear energy, which will continue to support uranium prices.
In an Interview with Kitco News, Duane Parnham, executive chair and CEO of Madison Metals, said that the world wouldn't be able to meet its future energy requirements without nuclear energy.
A global push for green renewable energy has fragmented the market; Parnham said despite growing solar technology, it won't be enough to fill the growing gaps in the electrical grid. Adding to the growing demand, Parnham also noted that government policies in the U.S. have made the domestic market disjointed, creating systemic supply issues.
"How is the world going to supply the power to meet the demand for all the electric vehicles being built?" Parnham asked. "You can't meet future electricity demand without uranium. The global fundamental outlook shows that there is no option but to use nuclear energy."
The comments on the global energy market come as the world faces rising energy prices. Although oil prices have fallen below $100 a barrel, they still remain extremely elevated. The oil and gas market continues to be dominated by Russia's ongoing invasion of Ukraine.
Europe, in particular, is feeling acute pressure from rising energy prices. The crisis has deepened even further as Russia, in retaliation to western sanctions, has cut oil and gas supply to Europe.
In this environment, the European Union has been looking for ways to reduce its dependence on Russian oil and gas and, in part, is turning to nuclear power. Earlier this month, the EU voted to include natural gas and nuclear in its list of green sustainable activities.
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Recently Germany has announced that it will look into having its three nuclear plants operating through the end of the year. The nation was planning to shut down the three plants by the end of the year.
Parnham said that the shifting political winds should continue to support a long-term uptrend in uranium.
Adding to the growing demand outlook, Parnham said that the market also faces a massive supply deficit as a decade of low prices has decimated uranium production.
The comments come as Madison Metals moves forward with two uranium projects in major mining jurisdictions. The junior explorer is developing its Kenora U Project near Kenora, Ontario. The property contains the past-producing Richard Lake Uranium Mine.
At the same time, the company is developing its Rössing North Project in Namibia. The African nation is one of the world's largest uranium producers.
This is Parnham's second foray into the uranium market. From 2006 to 2010, his then-company Forsys Metals developed its Valencia uranium project in Namibia.
