Cameco (NYSE:CCJ) is the world's largest producer of U3O8 uranium, a mineral whose only commercial use is to fuel nuclear power plants, and the second largest uranium producer in the world, behind Rio Tinto (ASX:RIO). Nuclear power accounts for about 15% of the world's electricity, and Cameco accounts for 20% of world uranium production^[1], with 500 million pounds of proven and probable reserves.^[2] It is involved in all stages of the uranium mining process, which includes exploration, fuel fabrication, and electricity generation. As one of only three conversion suppliers in the western world, Cameco controls about 40% of the western world's capacity to produce uranium hexaflouride (UF6), a compound used in the uranium enrichment process that produces fuel for nuclear reactors.^[3]

Every year since 1985, the world's consumption of uranium has been greater than its production.^[4] As one of the most economical sources of energy on a per unit basis, nuclear energy is an attractive alternative to fossil fuels. Cameco stands to benefit from the excess demand for uranium, especially as economic growth in the developing world continues to contribute to the rising demand for energy.

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