Uranium Report 2021 Everything you need to know about uranium! - Swiss Resource Capital AG
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Uranium Report 2021 Everything you need to know about uranium!
Disclaimer
Dear reader, tions of Swiss Resource Capital AG involve risks All publications of Swiss Resource Capital AG Investments in securities with low liquidity and advice (e. g. from the principle bank or a trusted ad- other factors that could cause actual events to differ
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or indirectly own shares of following Companies needs geared professional investment advice. In spi- own investment decision. vatives and fund recommendations are in principle Swiss Resource Capital AG especially in (translated) costs in connection with the mining contributions
which are described in this publication: GoviEx te of careful research, neither the respective author ruled out by Swiss Resource Capital AG and the re- press releases that are not historical facts are for- and workforce; the speculative nature of mineral ex-
Uranium, IsoEnergy, Skyharbour Resources, nor Swiss Resource Capital AG will neither guaran- All information published in publications of Swiss spective authors. Between the readers as well as the ward-looking information within the meaning of ap- ploration and development including risks of recei-
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2 3
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Table of Contents Imprint
Disclaimer ���������������������������������������������������������������������������������������������������������������������������������������02 Editor
Swiss Resource Capital AG
Invest with the commodity professionals
Table of Contents | Imprint�������������������������������������������������������������������������������������������������������07 Poststr. 1
9100 Herisau, Schweiz
Preface����������������������������������������������������������������������������������������������������������������������������������������������09 Tel : +41 71 354 8501
Fax : +41 71 560 4271
50-million-pound deficit should soon lead to a new uranium boom�������������10 info@resource-capital.ch
www.resource-capital.ch
Interview with Dr. Christian Schärer –
Manager of the Uranium Resources Fund and Partner of Incrementum AG ����20 Editorial staff
Jochen Staiger
Interview with Scott Melbye – Executive Vice President of Uranium Energy, Tim Rödel
Commercial V.P. of Uranium Participation Corp. and Ex-Advisor
to the CEO of Kazatomprom���������������������������������������������������������������������������������������������������26 Layout/Design
Frauke Deutsch
Company Profiles All rights reserved. Reprinting
You do not have to be a stock market professional SRC Mining & Special Situations Zertifikat material by copying in electronic
GoviEx Uranium����������������������������������������������������������������������������������������������������������������������������32 form is not permitted.
to make wise investment decisions. ISIN: DE000LS9PQA9
Invest together with Swiss Resource Capital AG and WKN: LS9PQA IsoEnergy�����������������������������������������������������������������������������������������������������������������������������������������36 Editorial Deadline: 10/31/2020
Asset Management Switzerland AG in the mega Currency: CHF/ Euro*
Skyharbour Resources��������������������������������������������������������������������������������������������������������������40 Cover: Vaclav Volrab / shutterstock.com
trend commodities. Since 05.03.2020 the experts‘ Certificate fee: 0.95 % p.a. Page 25: www.fredography.be / by
specialist knowledge has been available as a Performance fee: 15 % p.a. Uranium Energy����������������������������������������������������������������������������������������������������������������������������46 unsplash.com)
Wikifolio certificate: *Trading in Euro is possible at the Euwax in Stuttgart.
Back:
photo 1, 2, 3: flickr.com/photos/nrcgov
photo 4: TTstudio / shutterstock.com
Currently the following titles are represented in the SRC Mining & Special Situations Certificate (4/2020): FRANCO NEVADA | BHP BILLI
All images and graphics are, unless
TON | R.DUTCH SHELL B | MAG SILVER CORP. | ENDEAVOUR SILVER | AGNICO EAGLE | RIO TINTO | TOTAL FINA ELF SA B EO 10 | CALEDONIA
otherwise stated, by the companies.
MINING O.N. | FREE MCMORAN COP | ANGLO AMERICAN | URANIUM ENERGY CORP. | DYNACERT INC. | OSISKO GOLD ROYALTIES LTD |
Charts from 11/05/2020
SIBANYE STILLWATER LTD | CHEVRON | FIORE GOLD LTD | URANIUM PARTICIPATION CORP. | MAPLE GOLD MINES LTD | ROYAL NICKEL CORP. |
from JS Charts by amCharts
NEWMONT CORP. DL 1,60 | BLUESTONE RESOURCES | AURYN RESOURCES INC. | BARRICK GOLD
CORP. | GOLDMINING INC. | COPPER MOUNTAIN MINING CORP. | MILLENIAL LITHIUM CORP. |
ISOENERGY
6 LTD. O.N. | SKEENA RES LTD NEW | AURANIA RES CAD R.S. | ENWAVE. 7
Commodity-TV Preface
The whole world of commodities
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Dear Readers,
This new edition of the 2021 Uranium Report The closure of many large uranium mines in
marks the fifth year of this special report se- recent years could be the ignition point for
ries. For uranium, we see major imbalances rising uranium prices in the future. Supply is
in supply and demand coming to the mar- still falling, and demand is rising slightly.
kets. Without the generation of energy from
uranium, i.e. nuclear power plants, many Of course, we also present some interesting
countries will not only have a huge problem companies of this industry with facts and fi-
in the stable basic energy supply, but also a gures. This is to be understood as a suggesti- Jochen Staiger is founder and CEO
real power supply problem in itself as a re- on and not as a buy recommendation since of Swiss Resource Capital AG,
sult of the electromobility revolution. The de- there are only very few listed companies left. located in Herisau, Switzerland. As
velopment of the charging infrastructure is chief-editor and founder of the first
progressing much more rapidly in Europe Raw materials are the basis of our entire two resource IP-TV-channels
and electricity consumption is also continu- economic coexistence. Without raw materi- Commodity-TV and its German
ing to rise. Even I now drive a hybrid and di- als there are no products, no technical inno- counterpart Rohstoff-TV, he reports
ligently charge electricity for short trips in the vations and no real economic life. We need a about companies, experts, fund
city. The question is: Where does all the reliable and constant basic energy supply for managers and various themes
electricity come from, and without pollutant our highly industrialized world. around the international mining
emissions? Nuclear power is the only viable business and the correspondent
solution for many years to come, since the Swiss Resource Capital AG has set itself the metals.
sun and wind are not capable of providing a task of providing interested people with
base load and can therefore only be sup- comprehensive information about metals,
Download pliers. This question is all the more pressing raw materials and various listed mining com-
in Germany, where nuclear power is being panies. On our website www.resource-capi-
our unique App switched off and coal is being made to di- tal.ch you will find more than 20 companies
for free! sappear. Here it is once again worthwhile to from various commodity sectors as well as a
look at China, where a balanced mix of pho- lot of information and articles about commo-
tovoltaics, hydroelectric and wind power dities.
and above all nuclear power is being used.
China has understood that you need a relia- With our special reports we want to give you
ble, clean and cheap power supply, and nuc- insights and provide you with comprehensi-
lear power is the perfect solution. ve information. In addition you have the
chance to inform yourself through our two
Closely connected to the battery metals raw material IPTV channels www.Commodi- Tim Rödel is Manager Newsletter,
(main components of lithium-ion batteries, ty-TV.net & www.Rohstoff-TV.net free of Threads & Special Reports at SRC
the heart of every electric vehicle) is the ba- charge. For the mobile everyday life, you can AG. He has been active in the
Watch Management & Expert Interviews, Site-Visit-Videos, News Shows
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and receive top and up to date Mining Information on your mobile device batteries, and thus either the burning of coal, ty-TV App for iPhone and Android on your 15 years and accompanied
gas or oil or the use of uranium as a fuel ele- Smartphone. Here you get real-time charts, several chief-editor positions, e.g. at
worldwide!
ment in nuclear power plants. There are no stock prices, indices and the latest videos Rohstoff-Spiegel, Rohstoff-Woche,
other base-load-capable energy production automatically on your cell phone. My team Rohstoffraketen, the publications
methods as long as no adequately large sto- and I hope you enjoy reading the Special Re-
Amazing features: Wahrer Wohlstand and First Mover.
rage possibilities for electricity from renewa- port Uranium and we hope to provide you He owns an enormous commodity
• Company Facts ble energy sources are created. This report with a lot of new information, impressions expertise and a wide-spread
is intended to provide the reader with an and ideas. network within the whole resource
• Global Mining News
overview of the uranium industry and the real sector.
• Push Notofications facts, as well as of the energy supply world-
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9
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50-million-pound deficit should soon lead
to a new uranium boom
The world needs clean energy. Even in the Nuclear energy is currently the Uranium – The concentrated energy
Corona crisis! While the consumption of only base-load capable energy
electricity hardly decreased during the coro- source that can manage the
na period, many mines had to close down balancing act between an enor- Uranium is one of only two
(temporarily) due to corona. This led to a mously increasing power demand elements in which nuclear fission
slump in the production of corresponding and clean energy generation! chain reactions are possible
fuels such as coal and uranium. So while Uranium is irreplaceable for it!
many large mines had to temporarily shut Let us come to the element uranium itself. According to the International Atomic Ener-
down their operations or even stop them The worldwide energy demand has multip- Uranium is named after the planet Uranus gy Agency (IAEA), the largest uranium ore
altogether due to possible infections of the lied since the end of the 1980s. About 11% and is a chemical element with the element reserves are in the USA, Niger, Australia, Ka-
personnel, at the same time the system-rele- of the total energy demand worldwide is cur- symbol U and the atomic number 92. Urani- zakhstan, Namibia, South Africa, Canada,
vant coal and nuclear power plants must rently covered by nuclear power. However, it um is a metal whose all isotopes are radi- Brazil, Russia, Ukraine and Uzbekistan.
continue to operate in order not to let the so- is still mainly fossil fuels such as coal and oactive. Uranium, which occurs naturally in
cial system completely fall apart. The USA in crude oil that are burned to generate energy. minerals, consists of the isotope 238U
particular, but also other nations in which
nuclear energy plays an important role (such
The increasing demand for a reduction of
CO² emissions and the ever more noticeable
(99.3%) and 235U (0.7%).
Uranium mining
phenomenon of „global warming“ are cau- Uranium mining is basically divided into two
sing energy-guzzling industrial nations and different processes: Conventional producti-
[RN] 5f36d17s2 92
emerging markets in particular to increase on and extraction by means of in-situ lea-
Base load capability, what is that?
U
their energy efficiency and improve their CO² ching or in-situ recovery (ISR). The exact
budgets. The second important point is the method of extraction depends on the cha-
Base load capability is the ability of a power plant to provide ongoing electrical revolution, which in a few racteristics of the ore body, such as depth,
continuous, reliable electrical energy. This includes nuclear pow- years will not only make us almost 100% shape, ore content, tectonics, type of host
er plants, coal-fired power plants, gas-fired power plants, oil-fi- electrically mobile but will also bring a huge Melting Point 1406 K rock and other factors.
additional surge in demand for clean energy. Boiling Point 4203 K
red power plants and steam power plants fired with substitute
fuels. Combined heat and power plants, biomass and biogas Burning coal and oil cannot achieve both at URANIUM
power plants can also be base load capable under certain condi- the same time. The alternative is renewable Conventional production
tions, although fossil or renewable raw materials must also be energies, which require an enormous amount
burned. The only base-load-capable electricity generation from of time and money and are not even close to Most of the uranium is extracted by underg-
renewable energy sources is by means of hydroelectric power base load-capable without the lack of larger The uranium isotope 235U is fissionable by round mining. The deposits are developed
plants, although this often requires a major intervention in nature. electricity storage facilities, or nuclear pow- thermal neutrons and is therefore, apart from via shafts, galleries, ramps or spirals. Prob-
Photovoltaic and wind power plants are not suitable for base er, which can provide a great deal of energy the extremely rare plutonium isotope 239Pu, lems are often caused by the ingress of mine
load due to their often strongly fluctuating generation and thus in a CO²-neutral way. Some countries have the only known naturally occurring nuclide water and the so-called ventilation (technical
feed-in. long recognized this possibility of fast and with which nuclear fission chain reactions measures to supply mines with fresh air). The
almost clean energy generation and are now are possible. For this reason, it is used as a exact mining method is chosen according to
pushing the construction of new nuclear po- primary energy source in nuclear power the characteristics of the deposit. Above all,
wer plants. plants and nuclear weapons. the shape of the ore bodies and the distribu-
tion of the uranium in them are decisive. In
as France, Great Britain and China), urgently underground mining, an ore body can be
need fuel supplies. No matter what it costs, Occurrence mined in a targeted manner, resulting in much
one might almost think so, at least if one ta- less overburden than in open pit mining.
kes a look at the uranium spot price. The Uranium does not occur in nature in solid Near-surface or very large ore bodies are
price of uranium has risen sharply in the past form, but always in minerals containing oxy- preferably extracted by open pit mining. This
two years but is still far from an economic gen. There are a total of about 230 uranium enables the use of cost-effective large-scale
level. This has recently created a supply minerals that can be of local economic im- technology. Modern open-cast mines can be
shortfall of more than 50 million pounds of portance. There is a wide range of uranium from a few meters to over 1,000 meters deep
U3O8 per year, which can still be made up by deposits from magmatic hydrothermal to se- and can reach a diameter of several kilome-
stockpiles. But this will soon be over, which dimentary types. The highest uranium grades ters. Open pit mining often produces large
should give uranium investors a big boost are found in unconformity-type deposits with quantities of overburden. As in underground
for their depot. average uranium grades ranging from 0.3% mining, large quantities of water may have to
to 20%. The highest grades are over 70% be extracted for open pit mining, but ventila-
U3O8! tion is not a major problem.
10 11
The current status of
the uranium market
The last 45 years at missing Investments into
the procurement structure - thus into the inf-
rastructure of mines and processing plants
- will prove for uranium investors in the fu-
ture with high probability as lucky chance!
For despite the fact that, at the latest since
the Chernobyl catastrophe and even more
so after the events surrounding the nuclear
facilities in Fukushima, Japan, the number of
nuclear power plants worldwide is already at
a record high. Just 30 countries currently (as Overview of the reactors currently
of October 2020) operate 442 reactors with a under construction (blue) and the
total net electrical output of around 391.7 gi- corresponding net electrical capacity
gawatts. (light blue) per country
The current leading nuclear power nation Source: www.iaea.org/PRIS
with 95 reactors in operation is the USA. Ho-
wever, emerging markets such as China and
India in particular are requiring more and
more energy and have been focusing on a predicted in the fall of 2015 that its country But where is the additionally needed urani-
massive expansion of their nuclear power would rise among the world‘s largest users of um going to come from? Currently, only a
Overview of the currently running capacities for some time now. It is therefore nuclear power after the Chinese government few of the 22 Indian nuclear reactors are run-
reactors (blue) and the net electrical not surprising that 54 additional nuclear re- planned to build more than 80 new nuclear ning at full load. While Japan, China, Russia
power (light blue). ISR production actors with a total net electrical capacity of reactors in the next 15 years and more than and South Korea in particular have been
Source: www.iaea.org/PRIS around 57.3 gigawatts are currently under 230 new nuclear reactors by 2050. According able to secure uranium resources worldwide
In the ISR method, water and small amounts construction. Plans for 112 additional reac- to information from China Power, the new in recent years, India has completely missed
of CO2 and oxygen are injected into the tors have already been completed and 330 five-year plan for the energy industry, envisa- this opportunity. Only recently, several
sandstone layers with the help of so-called more are in the pipeline. ges a faster expansion of nuclear capacity purchase agreements have been concluded
injection wells, the uranium is dissolved out than has been the case to date: previously, with companies from the USA, Canada, Na-
and pumped back to the surface for further capacity was expected to rise to 58 giga- mibia, Kazakhstan, Russia, Great Britain and
processing with the help of so-called reco- watts in the coming years, but now more South Korea.
very wells. The whole process is therefore The demand situation than 90 gigawatts are under discussion. In At present, 7 nuclear reactors are under con-
completely underground. The advantages of 2005, the plan was for only 40 gigawatts by struction in India, with another 42 to follow
this process are therefore obvious: there is China sets the tone in the future 2020. By 2030, 110 reactors should be on by 2050.
no need for major earth movements as in the grid. A total of 11 nuclear reactors are
open-pit operation, no overburden or run-off While many self-proclaimed experts had al- currently under construction. In a further
basins for heavy metals and cyanides are ready prophesied the end of the atomic age, step, China‘s nuclear power generation is to Russia with increasing nuclear
created. Only the wells are visible on the sur- this is only just beginning to develop in the be expanded to 120 to 160 gigawatts by capacity
face, the areas around the wells can conti- world‘s most populous country. 49 reactors 2030!
nue to be farmed without restrictions. The with a total net electrical capacity of 46.5 gi- Russia has also announced a massive ex-
ISR process makes even low grade deposits gawatts are operated in the Middle King- pansion of its nuclear power plants. Russia
economically mineable, the capital costs for dom, which has so far mainly used coal to India massively expands its currently operates 38 nuclear reactors with
mine development are greatly reduced. In generate electricity. Of these, 10 new reac- nuclear program about 28.5 gigawatts. 4 plants are in the con-
addition, the whole process can be carried tors alone have been put into operation sin- struction phase. In addition, Russia plans to
out with a minimum of manpower, which ce the beginning of 2018. So the expansion India itself has hardly any significant uranium build 46 more nuclear power plants, which
also drastically reduces operating costs. Ac- of nuclear power in China is enormous and is deposits. A tenfold expansion of its own should increase the share of nuclear energy
cording to a study by the World Nuclear As- happening at breathtaking speed! nuclear energy capacities would at the same in the Russian energy mix from currently
sociation, 25% of the uranium mined outside The state-owned power plant manufacturer time mean a 10% increase in total global 15% to over 20%. In a further step, Russia
Kazakhstan recently came from ISR mines. Power Construction Corporation of China nuclear power generation. wants to increase this quota again to 25%.
12 13
Rising global expansion of wing all the time. Many of the coal-fired po- same time, more than 75% of the expected
nuclear energy wer plants still dating from the 1950s and reactor demand until 2025 is not contractu-
1960s operate inefficiently and uneconomi- ally secured. For a commodity such as urani-
In addition to the 31 nations that already cally. Sooner rather than later they have to um, which is only marginally traded, this re-
have nuclear reactors on the grid, another 17 be taken off the grid. Power consumption, turn to more „normal“ long-term contracts is
countries are planning to install nuclear po- on the other hand, is rising continuously. So likely to put tremendous pressure on both
wer plants. Among them are Egypt, Jordan, the USA has no choice but to increase the long-term prices and spot prices. Internatio-
Turkey and Indonesia. At the beginning of number of its nuclear reactors in the coming nal plant operators are therefore now increa-
March 2020, the 31st nation, the United Arab years. Of course, climate-friendly energy is singly showing signs of increased buying
Emirates, entered into nuclear power pro- also provided by photovoltaic systems, wind activity.
duction. There are another 3 reactors under farms, hydroelectric power plants or geo-
construction. South Korea currently has 4 thermal energy, but these energy producers
plants under construction. can only solve acute energy problems to a Summary
limited extent, since they are very costly on
the one hand and their output fluctuates ac- The fact is that 442 reactors are currently on-
cording to the time of day and weather con- line and at least 330 more are to be added by
ditions on the other. Therefore, nuclear pow- 2040. 54 plants are already under construc-
er is the only remaining climate-friendly tion, another 110 are in the concrete plan-
energy generation option. Given the amount ning phase.
of additional electricity required over the Furthermore, about 90% of all long-term Overview of the age of the currently
next two to three decades, renewable ener- supply contracts between uranium pro- needed to operate the reactors will come running reactors. Many will (have to) be
gies can only serve as an admixture to the ducers and power generation companies are from. The uranium industry in the USA is replaced by more powerful ones in the
overall energy mix. about to expire, which is likely to put estab- only a shadow of the past. In the last 45 ye- coming years.
In recent years, an application has been filed lished nuclear power nations such as the ars, practically nothing has been invested in (Source: www.iaea.org/PRIS)
for an extension of the operating life of more USA in particular in trouble. the development of new deposits and al-
than 60 U.S. nuclear reactors to 60 years of most 95% of the uranium needed has been
total operating time. In addition, there are obtained from disarmament programs. US
about 40 applications for the construction of nuclear reactors already consume about
new nuclear power plants. So far, however,
only 2 plants are under construction, another
The supply situation 21,300 tons of uranium annually. An increase
in capacity would accordingly require an in-
20 are in the concrete planning phase. Established producers are crease in the amount of uranium needed.
running out of air The World Nuclear Association (WNA) ex-
pects that in 2035, the USA alone will need
Long-term supply contracts The established uranium producing nations about 40,000 tons of uranium annually. Even
expire shortly Australia, Canada, Russia and Niger already in the heyday of U.S. uranium production in
had problems to expand their production the 1960s and 1970s, it would not have been
The previous cycle of contracting, domina- before the Corona crisis. All four countries possible to extract such a quantity from the
ted by the uranium price spikes of 2007 and together produced almost 19,445 tons of country‘s own plants. US uranium producti-
2010, has led plant operators to enter into uranium in 2019. In 2009, the figure was on reached its peak in 1980, when about
higher priced contracts with very long terms 28,000 tons of uranium. Some mines were 29,000 tons of uranium were extracted from
of approximately 8 to 10 years. On the one closed down due to the weak uranium spot the ground. After the end of the Cold War,
Overview of currently running reactors hand, these old contracts are expiring, but price. disarmed nuclear weapons in particular
(blue), currently shut down reactors The USA is threatened with ener- on the other hand, the plant operators have became the most important source for US
(grey) and reactors under construction gy collapse not yet made any efforts to replace these uranium demand. This led to a decline in
(light blue). supply volumes. Forward transactions by US-American uranium production American uranium production to less than
Source: www.iaea.org/PRIS With 95 reactors, the USA has by far the lar- plant operators are therefore declining shar- is no longer in existence 500 tons of uranium per year. As a direct
gest active nuclear power plant fleet world- ply, which means that the quantities required consequence, much of the infrastructure
wide. Nevertheless, the USA is threatened for which there is no contractual obligation The situation in the USA is even more threa- and approved production facilities were sim-
with a collapse in energy supply. The United yet, but which must be contractually secured tening. Although the Obama administration ply closed or completely dismantled.
States is still the country with the highest per in future, are also increasing. Uncovered de- has decided on a US$ 54 billion program to
capita consumption of electricity worldwide. mand is expected to exceed one billion promote the nuclear power industry in 2010,
And the Americans‘ hunger for energy is gro- pounds of U3O8 in the next 10 years. At the it is still far from clear where the uranium
14 15
Kazakhstan – the new uranium nada by about 45%. In addition, Cameco
superpower closed its Cigar Lake mine in March 2020 for
four weeks due to corona, which was subse-
While almost all established uranium pro- quently extended. In addition, Orano‘s McC-
ducers are having difficulties in rebuilding or lean Lake processing plant also had to clo-
expanding their uranium production, one re- se. Other closures include Moab Khotseng
gion has now moved past all other countries in South Africa and the Chinese-owned Hu-
to the forefront of uranium mining: Central sab and Rössing mines in Namibia, to name
Asia. In the last ten years, Kazakhstan in par- the most important. The spot market, whose
ticular has multiplied its uranium production supply is mainly composed of uranium
there. Uranium production in the former Sovi- mined as a by-product at other mines, has
et republic rose from 1,870 to over 24,586 also seen a recent decline in supply due to
tons between 2000 and 2016. In 2009, Ka- several mine closures.
zakhstan thus also overtook the previous lea-
der Canada and is now responsible for about
41% of total global uranium production. Huge supply gap was already
present before Corona
(Source: own representation)
Massive production cuts to stabi- Even before the Corona Pandemic, the sup-
lize prices ply shortfall was already about 40 million
pounds of uranium per year. The current de- about US$30 per pound of U3O8. So where If the uranium price were at US$130 per
But although Kazakhstan is one of the na- mand is therefore largely covered by stocks, will the more needed uranium come from in pound, approximately 3.86 million tonnes of
tions that can currently mine uranium at the which are thus rapidly running out. Thus, sin- the future? uranium could be economically mined. The
lowest cost, the country has long since cea- ce 2017, about 44% of production has been Increased production can only be achieved known reserves would then last for about 56
sed to be prepared to squander its uranium taken off the market. So there is de facto al- through a higher uranium price and associa- years at current consumption levels.
deposits at rock-bottom prices. In early ready a supply gap. At the current level of ted with large investments in the expansion
2017, the state-owned Kazatomprom an- 442 nuclear reactors worldwide, consumpti- of existing and new mines.
nounced that it would cut its own uranium on is about 183 million pounds of U3O8, of However, the basic problem remains the re-
production by at least 20% in 2017. In May which only about 139 million pounds are co- latively low uranium spot price, which does Conclusio
2018 Kazatomprom announced further pro- vered by global uranium production (exclu- not allow producers to access deposits that
duction cuts. In addition to this, the produc- ding the special effect Corona). The Interna- are more difficult to access and therefore Doubling the demand is matched
tion had to be further reduced due to corona. tional Atomic Energy Agency (IAEA) estima- more costly to mine. by almost no increase in supply!
However, Kazatomprom is not the only ura- tes that global uranium demand will increase
nium producer that has been relying on pro- to up to 300 million pounds of U3O8 in 2030 Experts estimate that at a market price of However, the uranium spot price is currently
duction cuts in the face of weak uranium due to the construction of new nuclear pow- US$40 per pound of uranium, there are just as far away from the US$130 per pound ura-
prices. Uranium major Cameco announced er plants. under 713,000 tonnes of commercially reco- nium mark as current demand will soon be
production cuts and closed its McArthur Ri- verable uranium. from future demand. According to a very
ver mine and Key Lake facilities indefinitely conservative estimate by the International
in January 2018. The Rabbit Lake mine was Summary With an annual consumption of about 68,000 Atomic Energy Agency (IAEA), this demand
also closed, both of which are among the tons of uranium, these deposits would there- will double in the coming years. In 10 to 15
top ten uranium mines in the world. McArt- The supply side is currently in a state of flux fore be sufficient for just 10 years, provided years, the above-mentioned ranges could be
hur River is the mine with the second highest in the uranium sector. The secondary supply that the market price for them remained halved without hesitation.
uranium production worldwide. With the from Russia‘s disarmed nuclear stocks is constant at at least US$40 during this period All this shows that the still - apparently che-
temporary closure, 10% of the total world becoming less and less important. While in and demand also remained constant. Howe- apest - way of generating electricity can only
production was taken off the market at a 2006 37% of the demand was covered by ver, this demand will inevitably increase. be used if the market price for the starting
stroke. In addition, Cameco has for some disarmed nuclear weapons, it is now only product uranium rises again. The market
time been acting as a uranium buyer itself in about 4%. At the same time, however, the If the market price for uranium were to rise, price of uranium is also determined by sup-
order to supply long-term, higher-priced number of nuclear reactors will increase dra- justifying extraction costs of US$80 per ply and demand. However, if the market
supply contracts with corresponding urani- matically. The established uranium pro- pound of uranium, it would be possible to price no longer permits economic producti-
um volumes at spot prices. ducers will not be able to completely cover economically mine approximately 1.28 milli- on, this price must and will inevitably rise. In
Since 2017, Kazatomprom has reduced its this equally erratic increase in demand - at on tonnes of uranium. Range at current the case of uranium, demand will also rise
uranium production by about 15% and Ca- least not at the current uranium spot price of consumption: 19 years. sharply due to the construction of several
16 17
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