Best of the Week
Most Popular
1. Stock Markets and the History Chart of the End of the World (With Presidential Cycles) - 28th Aug 20
2.Google, Apple, Amazon, Facebook... AI Tech Stocks Buying Levels and Valuations Q3 2020 - 31st Aug 20
3.The Inflation Mega-trend is Going Hyper! - 11th Sep 20
4.Is this the End of Capitalism? - 13th Sep 20
5.What's Driving Gold, Silver and What's Next? - 3rd Sep 20
6.QE4EVER! - 9th Sep 20
7.Gold Price Trend Forecast Analysis - Part1 - 7th Sep 20
8.The Fed May “Cause” The Next Stock Market Crash - 3rd Sep 20
9.Bitcoin Price Crash - You Will be Suprised What Happens Next - 7th Sep 20
10.NVIDIA Stock Price Soars on RTX 3000 Cornering the GPU Market for next 2 years! - 3rd Sep 20
Last 7 days
Covid-19 Pandemic Current State for UK, US, Europe, Brazil Vaccinations vs Lockdown's Third Wave - 12th Apr 21
Why These Stock Market Indicators Should Grab Your Full Attention - 12th Apr 21
Rising Debt Means a Weaker US Dollar - 12th Apr 21
Another Gold Stocks Upleg - 12th Apr 21
AMD The ZEN Tech Stock - 12th Apr 21
Overclockers UK Build Quality - Why Glue Fan to CPU Heat sink Instead of Using Supplied Clips? - 12th Apr 21 -
What are the Key Capabilities You Should Look for in Fleet Management Software? - 12th Apr 21
What Is Bitcoin Gold? - 12th Apr 21
UK Covd-19 FREE Lateral Flow Self Testing Kits How Use for the First Time at Home - 10th Apr 21
NVIDIA Stock ARMED and Dangeorus! - 10th Apr 21
The History of Bitcoin Hard Forks - 10th Apr 21
Gold Mining Stocks: A House Built on Shaky Ground - 9th Apr 21
Stock Market On the Verge of a Pullback - 9th Apr 21
What Is Bitcoin Unlimited? - 9th Apr 21
Most Money Managers Gamble With Your Money - 9th Apr 21
Top 5 Evolving Trends For Mobile Casinos - 9th Apr 21
Top 5 AI Tech Stocks Investing 2021 Analysis - 8th Apr 21
Dow Stock Market Trend Forecast 2021 - Crash or Continuing Bull Run? - 8th Apr 21
Don’t Be Fooled by the Stock Market Rally - 8th Apr 21
Gold and Latin: Twin Pillars of Western Rejuvenation - 8th Apr 21
Stronger US Dollar Reacts To Global Market Concerns – Which ETFs Will Benefit? Part II - 8th Apr 21
You're invited: Spot the Next BIG Move in Oil, Gas, Energy ETFs - 8th Apr 21
Ladies and Gentlemen, Mr US Dollar is Back - 8th Apr 21
Stock Market New S&P 500 Highs or Metals Rising? - 8th Apr 21
Microsoft AI Azure Cloud Computing Driving Tech Giant Profits - 7th Apr 21
Amazon Tech Stock PRIMEDAY SALE- 7th Apr 21
The US has Metals Problem - Lithium, Graphite, Copper, Nickel Supplies - 7th Apr 21
Yes, the Fed Will Cover Biden’s $4 Trillion Deficit - 7th Apr 21
S&P 500 Fireworks and Gold Going Stronger - 7th Apr 21
Stock Market Perceived Vs. Actual Risks: The Key To Success - 7th Apr 21
Investing in Google Deep Mind AI 2021 (Alphabet) - 6th Apr 21
Which ETFs Will Benefit As A Stronger US Dollar Reacts To Global Market Concerns - 6th Apr 21
Staying Out of the Red: Financial Tips for Kent Homeowners - 6th Apr 21
Stock Market Pushing Higher - 6th Apr 21
Inflation Fears Rise on Biden’s $3.9 TRILLION in Deficit Spending - 6th Apr 21
Editing and Rendering Videos Whilst Background Crypto Mining Bitcoins with NiceHash, Davinci Resolve - 5th Apr 21
Why the Financial Gurus Are WRONG About Gold - 5th Apr 21
Will Biden’s Infrastructure Plan Rebuild Gold? - 5th Apr 21
Stocks All Time Highs and Gold Double Bottom - 5th Apr 21
All Tech Stocks Revolve Around This Disruptor - 5th Apr 21
Silver $100 Price Ahead - 4th Apr 21
Is Astra Zeneca Vaccine Safe? Risk of Blood Clots and What Side Effects During 8 Days After Jab - 4th Apr 21
Are Premium Bonds A Good Investment in 2021 vs Savings, AI Stocks and Housing Alternatives - 4th Apr 21
Penny Stocks Hit $2 Trillion - The Real Story Behind This "Road to Riches" Scheme - 4th Apr 21
Should Stock Markets Fear Inflation or Deflation? - 4th Apr 21
Dow Stock Market Trend Forecast 2021 - 3rd Apr 21
Gold Price Just Can’t Seem to Breakout - 3rd Apr 21
Stocks, Gold and the Troubling Yields - 3rd Apr 21
What can you buy with cryptocurrencies?- 3rd Apr 21
What a Long and Not so Strange Trip it’s Been for the Gold Mining Stocks - 2nd Apr 21
WD My Book DUO 28tb Unboxing - What Drives Inside the Enclosure, Reds or Blues Review - 2nd Apr 21
Markets, Mayhem and Elliott Waves - 2nd Apr 21
Gold And US Dollar Hegemony - 2nd Apr 21
What Biden’s Big Infrastructure Push Means for Silver Price - 2nd Apr 21
Stock Market Support Near $14,358 On Transportation Index Suggests Rally Will Continue - 2nd Apr 21
Crypto Mine Bitcoin With Your Gaming PC - How Much Profit after 3 Weeks with NiceHash, RTX 3080 GPU - 2nd Apr 21
UK Lockdowns Ending As Europe Continues to Die, Sweet Child O' Mine 2021 Post Pandemic Hope - 2nd Apr 21
A Climbing USDX Means Gold Investors Should Care - 1st Apr 21
How To Spot Market Boom and Bust Cycles - 1st Apr 21
What Could Slay the Stock & Gold Bulls - 1st Apr 21
Precious Metals Mining Stocks Setting Up For A Breakout Rally – Wait For Confirmation - 1st Apr 21
Fed: “We’re Not Going to Take This Punchbowl Away” - 1st Apr 21
Mining Bitcoin On My Desktop PC For 3 Weeks - How Much Crypto Profit Using RTX 3080 on NiceHash - 31st Mar 21
INFLATION - Wage Slaves vs Gold Owners - 31st Mar 21
Why It‘s Reasonable to Be Bullish Stocks and Gold - 31st Mar 21
How To Be Eligible For An E-Transfer Payday Loan? - 31st Mar 21
eXcentral Review – Trade CFDs with a Customer-Centric Broker - 31st Mar 21

Market Oracle FREE Newsletter

FIRST ACCESS to Nadeem Walayat’s Analysis and Trend Forecasts

Wanna Go 'Green'? Go Geothermal

Companies / Renewable Energy Jun 15, 2010 - 12:51 PM GMT

By: The_Energy_Report

Companies

Investment guru Adrian Day likes "green" energy but doesn't see many ways to make money in that space, save two. In this "Coles Notes" interview with The Energy Report, Adrian gives us his favorite juniors in the geothermal sector and even offers a few of the base metals juniors that he owns.

The Energy Report: Could you give us an overview of the alternative energy market?


Adrian Day: We all know the story of why green energy is attractive. We all know the story about oil, the risks and buying it from unstable foreign countries. . .how dirty coal is, and so on. So, we all know the potential advantages of what we might call "green" or "alternative" energy.

The big problem for me, being a realist, is that most of them don't make money. Wind, solar and biomass are really just marginal additions to energy. At least for the foreseeable future, they're marginal in the overall picture, and they're also uneconomic. The only reason they make money is because the government gives them ridiculously outrageous grants.

TER: But of these different sectors of alternative energy—wind, solar and geothermal—you seem to hold a preference for geothermal energy.

AD: The beauty of geothermal is that it is green, renewable and has a very, very low environmental footprint. . .and it actually makes money. Now, the two that I like—Ram Power Corp. (TSX:RPG) and Magma Energy Corp. (TSX:MXY)—are both small companies, but they are the largest of the juniors. That's really important; in the geothermal space, you really have to have scale to grow. In very simplistic terms—and you know I am a simplistic person—the big difference between say the metals industry, or gold exploration, and geothermal is that a lot of your costs come right up front in the initial stages of exploration. And so, the costs are pretty heavy at the early stage of exploration; but, once the thing's in production, the capital costs, and, in particular, the operating costs, tend to be very, very low indeed. The point I'm making, however, is that you need scale in order to get to first base.

These two companies are both large enough and have good enough balance sheets that they are able to do the adequate exploration; and, of course, once you've done the exploration in the U.S., you can get some grants back from the government to help reduce your costs. Both of them have strong entrepreneurial management; both of them are growing. Just in the last couple of weeks, Magma has taken over the half of Iceland's big Orka Project that it didn't own—but it now has taken effective control: 98 %.

And Ram has just made an all-stock offer for a small geothermal company called Sierra Geothermal Power Corp. (TSX.V:SRA), and that's a perfect illustration of what I was saying. Sierra has a very good pipeline of about 14 projects in the U.S., a very good pipeline, but it just didn't have the capital to explore them and without the capital to explore them, they couldn't get grants from the government. It was really just stuck; it couldn't move forward. So Ram has a wonderful deal by buying these things very, very cheaply, and it has the capital to pursue them. So, yes, I like those two very much, and they're both at very good buying prices right now.

TER: You have all these gold equities and some royalty companies, but these are the only two geothermals. How did they find their way into your asset portfolio?

AD: I'm not sure whether you're talking about my money management or my newsletter—we have a lot of metals companies, resources of various types in the money management, so these would not be the only non-gold assets that we own. But I think the attraction there is that they have sort of high potential that you can see from a junior gold-exploration stock, and the people involved—or the people behind both Magma and Ram—are people who have been involved in the gold-mining industry. So, I think it was a sort of a natural fit.

TER: I believe those companies were in your newsletter list.

AD: That's probably right. We have a couple of larger oil and gas companies; but in the money management, we own a reasonable amount of smaller, diversified metal companies. One of my long-time favorites, Altius Minerals Corporation (TSX.V:ALS), for example, is primarily base metals and uranium. You know we own some silver companies, obviously; and Lumina Copper Corp. (TSX:LCC), a copper company.

TER: Any parting thoughts?

AD: The next few months, I think, will offer some great opportunities for buying, but I also think one needs to be a little bit cautious and, in particular, one needs to be selective in the next few months. I do think prices have the potential to come down in the next couple of months, but that will be the opportunity to buy.

Adrian Day is a British-born writer and money manager, a graduate of the London School of Economics, who has made a name for himself searching out unusual opportunities around the world, with two books on the subject. At his money management firm, Adrian Day Asset Management, he specializes in global diversification and gold equities for individual and institutional clients. Adrian is a frequent speaker at international seminars, and is a frequently guest on CNBC and The Wall Street Journal Radio network and has been interviewed by Money, Straits Times, Good Morning America and others.

Adrian's forthcoming book
Investing in Resources: How to Profit from the Outsized Potential and Avoid the Risks will be published by Wiley this autumn. He is also a contributor to the recent The Golden Rule: Safe Strategies of Sage Investors.

You may learn more about his services at www.AdrianDayAssetManagent.com, or via email AssetManagement@AdrianDay.com.

Want to read more exclusive Energy Report interviews like this? Sign up for our free e-newsletter, and you'll learn when new articles have been published. To see a list of recent interviews with industry analysts and commentators, visit our Expert Insights page.

DISCLOSURE:
1) Tim McLaughlin of The Energy Report conducted this interview. He personally and/or his family own shares of the following companies mentioned in this interview: None.
2) The following companies mentioned in the interview are sponsors of The Gold Report or The Energy Report: Avalon, Salares Lithium.
3) Michael Berry: I personally and/or my family own shares of the following companies mentioned in this interview: Salares Lithium, Quaterra Resources. I personally and/or my family are paid by the following companies. None.

The ENERGY Report is Copyright © 2009 by Streetwise Inc. All rights are reserved. Streetwise Inc. hereby grants an unrestricted license to use or disseminate this copyrighted material only in whole (and always including this disclaimer), but never in part. The ENERGY Report does not render investment advice and does not endorse or recommend the business, products, services or securities of any company mentioned in this report. From time to time, Streetwise Inc. directors, officers, employees or members of their families, as well as persons interviewed for articles on the site, may have a long or short position in securities mentioned and may make purchases and/or sales of those securities in the open market or otherwise.


© 2005-2019 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in

6 Critical Money Making Rules