Speaker Spotlight: Scott Melbye25 March 2019
As we enter our 14th consecutive year of this flagship annual event, there has never been a more appropriate theme than “U and the Future”.
The conference has secured some excellent keynote speakers and we recently asked Scott Melbye for his views on the industry.
Scott is a 35-year veteran of the uranium industry having led the global marketing and sales function of industry leaders, Cameco (President, Cameco Inc.) and Uranium One (Senior VP – Marketing). He began his career as a uranium broker for Nukem Inc., and subsequently, a nuclear fuel buyer for the Palo Verde Nuclear Generating Station in Arizona.
Q. Where do you see uranium mining and nuclear power in 10 years’ time?
A. Very optimistic that nuclear energy will see accelerated growth in the next decade with the uranium industry also rebounding on strong fundamentals from what has been a long, and pronounced, bear market.
Despite the headwinds presented from Fukushima, the nuclear energy industry has experienced its best growth rates in the past twenty-five years. Thirty-seven reactors have come on line globally in the past four years and fifty-seven reactors are currently under construction. Going forward, the almost panicked realization that the climate change community has been fighting carbon emissions for the past twenty-four years with very little success, has changed the narrative around nuclear energy. Even some of the most ardent anti-nuclear opponents have changed their tune and are now embracing nuclear power’s ability to play a central, critical role in a lower carbon future.
As for the uranium industry, this prolonged bear market has finally manifest itself in improving fundamentals that are a prerequisite for uranium prices to return to more healthy levels. The roll-off of legacy contracts signed in a previous cycle have finally caused producers to rationalize their production levels in light of spot prices which have fallen below the majority of global production cost, and well below the incentive price for new mines. At present we have seen sixty million pounds of annual supply removed from the market as a result of these cutbacks, in addition to speculative buying by financial players taking sizeable volumes of spot material “out of circulation”. On the demand side, this growth in nuclear generation has resulted in global uranium requirements returning to their pre-Fukushima levels (approaching 200 million pounds of annual U3O8 demand).
As a result, we have seen uranium prices increase 55% over their November 2016 lows, but we are still very early in this recovery process.
Q. Name one challenge that needs to be solved today to guarantee nuclear’s crucial part in the world’s future energy mix?
A. Our nuclear industry must continue to educate the public regarding the enormous benefits provided by nuclear energy to modern societies, and dispel irrational fears and misconceptions regarding nuclear power safety and radiation. We are seeing the beginnings of wider acceptance and need to build on that growing support.
Q. What impact could nuclear power have on climate change from an Australian perspective?
A. In 2018, a prestigious group of 38 energy and climate change experts penned an open letter to the Presidents and Prime Ministers of the G-20 nations, imploring them to consider nuclear energy as an important part of the solutions required to reduce global carbon emissions. From an Australian perspective, this changing narrative on the societal benefits of nuclear energy should be viewed very favorably given the proximity to some of the world’s largest and fastest growing economies in Asia. Beyond climate change, this is also a critical issue of reducing air pollution and quality of life for millions of people striving for economic growth and a higher standard of living. This also begs the question of when Australia will join this movement and embrace nuclear energy for its own needs, especially in light of possessing some of the world’s largest resources of uranium on its own territory.
Q. What message would you like to provide to the delegates – what do you hope will be the main message they will take away from your keynote presentation?
Despite the many challenges that have faced the nuclear energy and uranium industry’s in recent years, we can look forward today with great pride and optimism. Pride in the major role our technology plays in delivering safe, affordable, and abundant clean air energy to growing global economies, and optimism at the front end of the nuclear fuel cycle where once again new operations and sources of supply will be needed to meet the robust demand for uranium going forward. The Australian uranium industry is well positioned to play a key role in these positive developments.