Kazakhstan extends links with Ukraine

Askar Zhumagaliyev, chairman of KazAtomProm, and Igor Nasalik, Ukraine's energy and coal industry minister, have held their second meeting on future cooperation in the nuclear energy sector. The world's biggest uranium producer said in a statement yesterday the meeting focused on production of fuel for Ukrainian nuclear power reactors.

According to KazAtomProm, Nasalik had "assured the delegation from Kazakhstan that Ukraine has genuine interest in mutually beneficial cooperation" in the production of fuel assemblies for use in Ukrainian nuclear power plants. Zhumagaliyev had added that KazAtomProm has the "strategic objective to diversify production", according to the same statement.

Nasalik noted that Ukraine also has the strategic objective to diversify the supply of nuclear fuel and its components. KazAtomProm said this "means that Kazakhstan has the opporunity to become a reliable partner of enriched uranium supply".

The two sides have agreed to arrange working groups to "analyse the economic viability of the project". The two men also discussed "the possibility of mining and supplying enriched uranium and ion exchange resin to Ukraine".

A delegation from Nasalik's ministry visited state-run KazAtomProm's headquarters last month to discuss cooperation in the nuclear energy sector.

Uranium production

The world's biggest uranium producer, Kazakhstan has 12% of the world's uranium resources and an expanding mining sector, producing about 23,800 tonnes in 2015.

Zhumagaliyev told delegates at the World Nuclear Association's 41st Annual Symposium in London last week that current uranium spot market conditions do not justify further Kazakh production increases.

"KazAtomProm's cost of uranium production is one of the lowest in the world. However, taking into account the realities of market, which is currently over-supplied, we do not see any need to increase our production volume," Zhumagaliyev said.

"In my opinion, it's much better to leave this valuable asset in the ground and realise its great influence in future," he said.

Under the current rate of production, uranium reserves in Kazakhstan will last for more than 60-70 years, he said, adding that these reserves represent "valuable future supply" to the 59 reactors presently under construction globally, and the additional 168 new units planned, or on order.

"We are confident KazAtomProm will play a very important role in supplying future plants," Zhumagaliyev said.

In May, KazAtomProm and Canadian uranium producer Cameco agreed to restructure the Inkai joint 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, currently owned 60% by Cameco and 40% by Kazakh state-owned KazAtomProm.

Diversification

Zhumagaliyev met with the head of China's CITIC Group in July to discuss attracting investment to the Central Asian country's nuclear energy sector. CITIC Group, formerly the China International Trust and Investment Corporation, is a state-owned investment company established in 1979. The talks build on agreements KazAtomProm signed with Chinese companies at the end of last year. These include one for the development of Kazakh uranium mines and the construction of a nuclear fuel plant in Kazakhstan.

Earlier this month, Kazazh and Chinese companies signed an agreement on nuclear fuel pellets supply. KazAtomProm's Zhumagaliyev, the chairman of CGNPC Zhang Shanmin, the CEO of Ulba Metallurgical Plant (UMP) Yuri Shakhvorostov, and the general manager of CGNPC-URC Cai Yusheng, signed the agreement during Kazakhstan President Nursultan Nazarbayev's working visit to China. According to the agreement, Kazakhstan will supply 180 tonnes of nuclear fuel pellets to Chinese utilities in 2016-2018.

The International Atomic Energy Agency (IAEA) Low Enriched Uranium Storage Facility - or 'bank' - is scheduled to be ready for operations by September 2017, following the conclusion of a partnership agreement between the IAEA and UMP. The agreement was signed on 27 May in Vienna by IAEA LEU Bank project executive Mark Bassett and UMP sales director Alexander Khodanov.

In April, KazAtomProm and ConverDyn of the USA signed an agreement whereby the world's largest uranium producer and the "leading provider" of uranium hexafluoride (UF6) conversion services will jointly and immediately offer uranium in the form of natural UF6 to global utilities. UF6 is the natural uranium feedstock for the enrichment step in the nuclear fuel cycle. The agreement was signed by Zhumagaliyev and Malcolm Critchley, president and CEO of ConverDyn.

In July last year, KazAtomProm signed a contract with India's Department of Atomic Energy (DAE) to supply 5000 tonnes of uranium over the following four years.

The contract was signed by Zhumagaliyev and DAE head Anil Shrivastava during a meeting between Nazarbayev and Indian prime minister Narendra Modi in Astana.

In October the same year, KazAtomProm said it plans to follow the example of other major uranium mining companies and create a trading subsidiary. This plan, it said, is part of its "transformation" strategy.

Umirzak Shukeyev, chairman of Kazakhstan's sovereign wealth fund, said the key objectives of the strategy include "trebling the company's value" by 2025. Samruk-Kazyna, which is KazAtomProm's sole shareholder, was launched in 2008 to modernize Kazakhstan's economy and help attract foreign investors. It has influence over hundreds of state companies in the country, including KazAtomProm and KazMunayGaz.

Zhumagaliyev added that the company plans "to become the leading supplier of natural uranium on the world market, to diversify production at the front end of the nuclear fuel cycle, in particular, to start production of fuel assemblies".

"A lot of attention will be paid as part of the transformation to strengthening [KazAtomProm's] marketing operations," Zhumagaliyev said.

At the Symposium last week, Zhumagaliyev stressed the importance of KazAtomProm's transformation, adding that he had held a series of working meetings at the event with the CEOs of "major industry companies" and had "discussed issues of further cooperation".

This year, about 600 delegates from 35 countries participated in the Symposium.

Written and researched
by World Nuclear News