Areva JV to develop Mongolian mines

28 October 2013

French nuclear company Areva has signed an agreement to develop uranium mines in Mongolia and to set up a joint venture company with Mongolian state-owned company MonAtom, with Mitsubishi Corporation as an equity partner.

Fabius-Bold (Ministry of Foreign Affairs Mongolia_460
French and Mongolian foreign ministers Laurent Fabius and Luvsanvandan Bold welcomed the agreement (Image: Mongolian Ministry of Foreign Affairs)

The agreement was signed in the presence of the French and Mongolian foreign ministers at a ceremony in the Mongolian capital of Ulaan Baatar. It provides for the establishment of Areva Mines LLC, which will be 66% owned by Areva and 34% owned by MonAtom. Although confirming that an agreement for Mitsubishi Corporation to take an equity interest had been signed, Areva gave no further details on the Japanese company's involvement.

In a joint statement issued on the conclusion of the visit to Mongolia by French foreign minister Laurent Fabius, the two countries welcomed the signing of the agreement. In it they said that the agreement complied fully with the 2010 nuclear cooperation agreement signed by the governments of Mongolia and France and would "serve as a solid basis for expanding bilateral trade and economic cooperation." Fabius's trip was the first official visit to Mongolia by a French foreign minister since diplomatic relations were established between the two countries in 1965.

Mining is a mainstay of the Mongolian economy. Russian interests produced uranium from the Dornod mine in the period from 1988 to 1995, although no uranium mines are currently active in the country. A new nuclear energy law passed in 2009 regulated the exploration, development and mining of uranium as well as giving the state a greater degree of ownership and control of uranium resources. A Russian-Mongolia joint venture to develop the Dornod deposit was announced in late 2010, and although plans are hazy it appears that production of 1000-1200 tU per year could start at Dornod in 2015.

Areva has had a presence in the country since 1997 through its wholly-owned holding company Areva Mongol. Exploration work by Areva Mongol subsidiary Cogegobi led to the discovery of uranium deposits at Dulaan Uul and Zoovch Ovoo, with resources estimated at 60,000 tU.

Canadian, Chinese and Japanese companies are also involved in uranium exploration and development activities in Mongolia. Canada's Denison Mines is working towards the development of resources identified at Hairhaan and Hairat in the south Gobi desert, through Gurvan Saihan Joint Venture (GSJV).

Researched and written
by World Nuclear News

Filed under: Contracts, Mining, Mongolia