COP28 Landmark Agreement to Transition Away From Fossil Fuels Highlights Importance of Nuclear and Uranium
Bacchus Capital Advisers ("Bacchus Capital") is pleased to see that the ‘UAE Consensus’ was unanimously agreed at COP28 in Dubai. The UAE Consensus is a landmark agreement between ministers representing nearly 200 countries which calls on all parties to contribute and to take actions including “transitioning away from fossil fuels in energy systems, in a just, orderly and equitable manner, accelerating action in this critical decade, so as to achieve net zero by 2050 in keeping with the science”.
In order to achieve this transition, the UAE Consensus calls for the acceleration of development of low-emissions power, including nuclear and hydrogen, additional focus on carbon capture and storage, and the tripling of global renewable energy capacity by 2030.
The landmark agreement at COP28 further endorses the underlying investment thesis of Yellow Cake plc (AIM: YCA) ("Yellow Cake"), that nuclear power will be an essential segment of the low-carbon baseload required to power the transition economy. Yellow Cake – founded and established by Bacchus Capital to be a specialist company operating in the uranium sector with a view to holding physical uranium for the long-term – has recently traded above £6.00 /sh, 300% its initial IPO price of £2.00 /sh in July 2018. Additionally, following two successful equity raises in 2023, for gross proceeds of US$201 million, Yellow Cake is trading at a market capitalisation of c. US$1.6 billion. Performance since IPO positions Yellow Cake as one of the best performing metals and mining stocks on the LSE over the last five years.
In 2017, Bacchus Capital identified the systemic misalignment of uranium’s near to mid-term supply and demand, where flat or declining production contrasted sharply against growing demand underpinned by an expanding global fleet of nuclear reactors.
Peter Bacchus, Chairman and Chief Executive of Bacchus Capital said:
“Yellow Cake brought a new asset class to the UK investment market which enabled investors to access direct exposure to the uranium price. We remain highly constructive on the long-term uranium price and the landmark agreement at COP28 once again brings focus onto the role nuclear power will play in our low-carbon future.”