Uranium company executives defended the nuclear-power industry's growth plans Monday after overheating at nuclear reactors in Japan caused a rout in their share prices.

Most of the major uranium-miner stocks dropped more than 10% Monday as investors feared Japan's reactor problems could endanger the world-wide "nuclear renaissance"--a resurgence in uranium commodities and stocks due to expectations of low future uranium supply and increasing demand from new reactors.

Jerry Grandey, chief executive of Cameco Corp. (CCJ), the world's largest publicly owned uranium company, said Monday that the selloff in uranium shares was "largely driven by emotion." He said that Cameco, which gets 18% to 20% of its revenue from Japan, didn't expect any significant effect on its business now or in the future.

Even if the 11 reactors that were in the earthquake and tsunami zone were to defer part of their uranium purchases, Cameco would be "well within" its guidance for the year, he said.

Of the world's 442 nuclear power plants, 54 are in Japan. The Japanese government said Monday that the fuel rods in one of three overheating reactors have fused together in a partial meltdown. A partial meltdown occurs when uranium fuel begins to melt under high temperatures, but still remains contained within the reactor. The 1979 Three Mile Island accident in the U.S. was a partial meltdown. In a full meltdown, such as the 1986 Chernobyl disaster in the Soviet Union, the rods melt completely and the release of energy causes an explosion that contaminates the surrounding area with radioactive material.

Despite Japan's problems, Grandey said Cameco's customers in India, China, South Korea and other Asian nations, where the bulk of the about 60 nuclear reactors are under construction or refurbishment, have said they remain committed to their nuclear program.

"Some voices have questioned whether the nuclear renaissance will survive this disaster," Grandey said. "Looking beyond the events of recent days, we at Cameco don't see a dramatic effect on the fundamentals of our uranium business. Growth of nuclear capacity in China, India, Korea and elsewhere ... has tremendous momentum and we expect it will continue."

Amir Adnani, Chief Executive of Uranium Energy Corp. (UEC), said Monday that it is too early for politicians or the media to begin "writing the obituary of the nuclear renaissance." In retrospect, the nuclear incidents in Japan may prove the ability of the nuclear industry to respond to disasters, he said.

"The oil infrastructure went up in flames. The only infrastructure left standing that was built in the 1970s were these reactors. There wasn't a significant radiation release and so far they've demonstrated that the safety systems for the most part have worked."

Adnani and Cameco executives also said that despite the incident, spot prices for uranium still reflected short supplies and high demand.

Adnani said the rout in equity prices--his own company closed down 19.2% on the American Stock Exchange Monday--was "completely unjustified, due to the fact that you've got current demand from 440 operating nuclear reactors that will need uranium to generate 18% of the world's electricity," while supply hasn't kept up with the growth in demand for decades.

The rout in equity prices will make it harder for development-stage uranium companies to get financing, companies may reconsider commissioning new projects and there may even be softness in the spot uranium price, Adnani said.

"The capital markets, responding to this news over the weekend, are putting a lot of pressure on a sector that was just starting to get some life," he said.

   -By Edward Welsch, Dow Jones Newswires; 403-229-9095; 
   edward.welsch@dowjones.com
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