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Nuclear warheads once mounted on Russian ICBMs and aimed at American cities now provide 50% of the electricity being produced by America's nuclear power plants under terms of the Megatons to Megawatts (M2M) agreement. However the 1993 accord between the two nations, which, in fact provides the U.S. with 24 million tons of low enriched uranium (LEU) per year, will expire at the end of 2013.

Many calling the shots in Russia today are against the Yeltsin era pact, seeing it as a compromise of national security. Therefore an extension of M2M beyond 2013 is unlikely.

Completion of this agreement will leave a widening gap in the supply of uranium fuel at a time when global use of nuclear power is set to increase. In the U.S. alone, 103 nuclear reactors are currently in operation, while new construction and operating permits for 15 more are under review. According to government and industry sources, seventeen companies are also preparing license applications for as many as 31 new U.S. reactors.

Other sources of uranium fuel will be needed to meet current and future demand.

Indeed, the history of uranium is an interesting one. Uranium, first discovered in the ancient world, was quickly discarded as tailing from the process of silver mining.

The radiant rock, 40 times more abundant in the earth's crust than silver, has evolved over time from mining refuse to tinting for glass to health treatment to atomic bomb to fuel for production of nuclear power.

And today, demand is on the rise.

One ton of natural uranium can produce more than 40 million kilowatt-hours of electricity. This is equivalent to burning 16,000 tons of coal or 80,000 barrels of oil.

According to a recent article by Markus Aarnio the 5 largest players in the uranium arena who will be looking for their fair shares of the nuclear energy pie are the Canadian company, Cameco (CCJ) one of the largest uranium producers in the world; Australian supplier, Paladin (OTCPK:PALAF); British giant (Rio Tinto) (RIO); South African, AngloGold Ashanti (AU); and the Canadian, Berkley Resources (OTCPK:BKLRF) which according this company's most recent financials is now calling itself Berkley Renewables, and currently appears (in this writer's opinion) more focused on solar energy solutions.

So with increased fuel need imminent, my money may soon be on Uranium Energy Corporation (UEC). The United States, Texas based junior, seems a good bet to be looked upon to help fill the increasing need for U.S. nuclear power fuel. And with Texas having a unique streamlined permitting framework for uranium mining, UEC's efforts will not be hindered by red tape.

The company is debt free with money in the bank and a market cap of more than $135M. UEC also has ample resource stockpiles, increasing strategic, environmentally friendly production capabilities (growing and ongoing) and an aggressive exploration plan in several other western U.S. states and Paraguay.

No imports will be needed here.

Uranium Energy Corporation's production is focused in South Texas in the middle of the Texas uranium belt, an approximately 300-mile stretch of (mostly) sandstone that extends from east-central Texas to South Texas. The area holds abundant known uranium that is well suited for low-cost In-Situ Recovery, IRS.

(click to enlarge)

The company's Palangana mine increased production to 48,000 pounds U3O8 up from 29,000 in the preceding quarter. While additional production areas at Palangana, particularly Production Area-3, saw development completed and production commencing in December 2012 already putting out 28,000 pounds U3O8 through January 2013; with Production Areas 4 and 5 nearing completion. And UEC's low production costs per pound are expected to become even lower in the very near term due to many increased production factors.

Through the use of a historical exploration database - UEC owns one of the largest such databases - that documents decades of South Texas-focused uranium exploration and mining, UEC has been able to target projects that have already been the subject of significant exploration and development by senior energy companies in the past. This is key.

The CEO, still in his 30s, is an upcoming superstar.

Amir Adnani is co-founder of Uranium Energy Corporation and has been the President, Chief Executive Officer, and a director since January 2005. He serves as a spokesman for the uranium industry before all international media, and is frequently invited to speak before major industry gatherings including the Milken Institute Global Conference and the World Nuclear Fuel Conference. Mr. Adnani is also recognized by Casey Research, a leading investment advisory publisher, as one of the top 10 "next generation" mining industry entrepreneurs, according to the company's web site.

Casey Research has Mr. Adnani featured as #3 on their top 10 "NexTen" Resource Explorers list.

Mr. Adnani is also co-founder and Chairman of Brazil Resources Inc. (OTCQX:BRIZF) a gold exploration company with active projects in the gold districts of Brazil.

Uranium Energy Corporation certainly has the expertise to advance the company's agenda. Chief Operating Officer and Director, Harry Anthony, is an internationally recognized expert in the uranium industry. An engineer of 36 years, Mr. Anthony has been at the forefront of multiple aspects of the uranium industry, particularly noted as a pioneer of the emerging uranium extraction technology known as "In Situ Recovery", or ISR.

ISR is a significantly less costly and less environmentally obtrusive technique for mining uranium than any other method currently in use. Further, Harry Anthony has been involved with every notable ISR uranium mine in the US and abroad, at all levels of development including feasibility, design, operations, and management.

To view an animated video presentation of In Situ Recovery, click here.

Conclusion

This writer likes to put his coin and confidence in the man behind the company. Like David Beling of Bullfrog Gold (OTCQB:BFGC) and Rob McEwen; McEwen Mining (MUX), the man highlighted in a previous piece.

In this case, Amir Adnani is the little guy in this sector with something big to prove. Uranium Energy Corporation is a junior uranium miner with strong, intelligent management and tremendous upside potential. The company's stock is currently trading just above its 52 week low at about $1.57 per share as of this writing.

Uranium Energy Corporation is hungry, has a personal interest in advancing its market share, wants to be and is capable of, becoming a significant player in filling the ever increasing need for uranium fuel going forward, and poised for rapid growth.

Source: Russian Nukes Will No Longer Pack Power: A Case For Uranium Energy Corp.