Cameco and KazAtomProm have agreed to restructure the Inkai jont venture, extending their cooperation in the Kazakh in-situ leach (ISL) uranium project until 2045. The agreement will see Kazatomprom increase its share of the joint venture to 60% with Cameco becoming a minority owner.
Inkai, in southern Kazakhstan, is owned and operated by Joint Venture Inkai (JV Inkai), currently owned 60% by Cameco and 40% by Kazakh state-owned KazaAomProm. The new agreement, inked in Astana today, replaces a memorandum of understanding signed in September 2012. It provides for annual production to be ramped up to 10.4 million pounds U3O8 (4000 tU) per year over three years, following the receipt of all required approvals. These include amendments to JV Inkai's existing resource use contract that are expected to take 18-24 months to secure.
KazAtomProm will increase its share in the joint venture to 60% and Cameco reduce its share to 40%.
The agreement includes provisions to make Cameco's proprietary uranium refining technology available to Kazatomprom on a royalty-free basis, and grants KazAtomProm a five-year option to license Cameco's uranium conversion technology for the purposes of constructing and operating a uranium conversion facility in Kazakhtsan.
The two companies will also complete a feasibility study to evaluate the design, construction and operation of a uranium refinery in Kazakhstan, capable of producing 6000 tU per year as uranium trioxide. Such a facility would be owned 71.67% by KazAtomProm and 28.33% by Cameco, and Cameco's interest in JV Inkai would increase to 42.5% on commissioning of the refinery. Should the companies decide to build the refinery, KazAtomProm will also be given an option to obtain UF6 conversion services at Cameco's Port Hope facility and to receive other commercial support from the Canadian company. Cameco's ownership levels in both the refinery and JV Inkai could increase to 29.33% and 44%, respectively, depending on the level of commercial support it provides.
KazAtomProm chairman Askar Zhumagaliev said that the two companies had "for many years now" been engaged in a highly co-operative and mutually beneficial relationship. "Therefore, we intend to further expand our partnership, balancing the economic interests," he said.
Cameco president and CEO Tim Gitzel said the agreement strengthened the partnership and moved them closer to realising the full potential of their investments in the Kazakh project. "For Cameco, the agreement advances our strategy of building on our low-cost production assets that helps to mitigate the risk of today's uncertain uranium market and positions us to maximize returns when the market recovers," he said.
With 12% of the world's uranium resources, Kazakhstan is the world's leading uranium producer. It produced about 23,800 tU - 39% of world production - in 2015.
Kazakhstan produced 6000 tU between January to March and plans to increase output for the whole of 2016 to 24,080 tonnes, up from 22,800 tonnes last year. The Central Asian country's energy minister, Kanat Bozumbayev, has been quoted by local media as saying Kazakhstan's share of the world uranium market is to be retained alongside creation of a "vertically-integrated complex" for the nuclear fuel cycle.
Researched and written
by World Nuclear News