INVESTORS

URANIUM 101

  • Introduction to Uranium

    (October 25, 2007)

    A typical pellet of uranium weighs about 7 grams (0.24 ounces). It can generate as much energy as 3.5 barrels of oil, 17,000 cubic feet of natural gas, or 1,780 pounds of coal.

  • What is uranium?

    In its pure form, uranium is a silvery white metal of very high density -- even denser, than lead. Uranium can take many chemical forms, but in nature it is generally found as an oxide (in combination with oxygen). Triuranium octoxide (U 3O8) is the most stable form of uranium oxide and is the form most commonly found in nature.

    Uranium has the highest atomic weight of the naturally occurring elements. In the actinide series of the periodic table it has the symbol U and atomic number 92. It has 92 protons, 92 electrons and either 145 or 146 neutrons. Uranium atoms that contain 146 protons are referred to as the "uranium 238 isotope" (238U) and constitute 99.3% of naturally occurring uranium. Uranium atoms that contain 145 neutrons are referred to as the "uranium 235 isotope" (235U) and are weakly radioactive. The 235U isotope makes up the balance (0.71%) of naturally occurring uranium. Its nucleus can be made to split (or fission) inside a nuclear reactor with the release of great quantities of energy which can be used to generate electricity.

    Uranium decays slowly by emitting an alpha particle. The half-life of uranium-238 is about 4.47 billion years and that of uranium-235 is 704 million years, making them useful in dating the age of the Earth.

    The 1789 discovery of uranium in the mineral pitchblende is credited to Martin Heinrich Klaproth, who named the new element after the planet Uranus. Eugène-Melchior Péligot was the first person to isolate the metal, and its radioactive properties were uncovered in 1896 by Antoine Becquerel.

    In 1993 the USA and Russia entered into the so-called "Megatons-to-Megawatts" agreement whereby each country would dismantle a significant fraction of its nuclear weapons and recycle the contained Highly Enriched Uranium (approximately 90% 235U) to Low Enriched Uranium (4-5% 235U) for use as fuel in nuclear power reactors. To date this program has converted the uranium in approximately 11,000 nuclear warheads into reactor fuel.

  • Where is uranium found?

    Uranium is one of the most abundant elements found in the Earth's crust. It can be found almost everywhere in soil, rock, rivers and oceans. Traces of uranium are even found in food and human tissue.

    It is 500 times more abundant than gold and it is as common in the earth's crust, often in association with tin, tungsten and molybdenum and is commercially extracted from uranium-bearing minerals such as uraninite.

    The concentrations of uranium vary according to the substances with which it is mixed and where it is found. For example, granite, which covers 60% of the Earth's crust, contains approximately four parts of uranium per million, i.e. 999,996 parts of granite and four parts of uranium. When uranium is present at concentrations exceeding approximately 500 parts per million (0.05%) it can be economically recovered at today's market prices.

    Whether uranium can be mined is a function of many factors including geological setting, extraction method, market prices and social and environmental considerations.

  • Supply of uranium

    World uranium production is dominated by Canada and Australia which, together, produce about 51% of annual mine supply. These two countries are followed by Kazakhstan, Niger, Russia and Namibia. These six leading producers account for approximately 84% of worldwide mine production. In 2006, world production of uranium was 40,000 tonnes U.

    Canada, Australia and Kazakhstan are estimated to account for over half of the world's resources of uranium, which are estimated to total approximately 4.74 million tonnes. Australia has approximately 30% of World resources, Kazakhstan 17% and Canada 12%.

  • Demand for uranium

    Many industrialized nations are heavily dependent on nuclear power generation, with nuclear electricity representing a major component in such countries as the United States (20%), Germany (30%), Japan (34%), Hungary (36%), Sweden (46%), and particularly France (78%) and Lithuania (80%). Worldwide, there are 443 nuclear power reactors operating in 31 countries with total installed capacity of 370,000 MWe. The scale of the world's nuclear industry is considerable and growing.

    Primary uranium production filled only about 62% of world reactor requirements during 2006. The balance was made up by secondary supplies including: re-enriched depleted uranium; reprocessed used fuel; and blended down highly enriched uranium (HEU).

    Concerns over the global oil supply and global warming have renewed interest in nuclear energy as it is a carbon-free source of electricity with no CO 2 emissions. Other factors that are In addition, improved reactor performance, extended fuel cycles, increased generating capacity and reduced operating costs are also contributing to a revival in nuclear power.

    As of January 2006, there were 24 reactors under construction, 41 planned (approved and funded) and another 113 proposed (intended but not approved or funded). New construction is currently concentrated in Asia with China and India in the forefront.

    Power uprates have been granted for reactors in many countries, including Belgium, Sweden, Germany, Switzerland, Spain and the United States. In the USA such uprates have added 3,000 MW of new generating capacity which is equivalent to the output of three new reactors. Many reactors are having their operating licenses extended by an additional 20 years; over three-quarters of USA nuclear plants have received 20-year license renewals or are in the process of having their applications approved.

    As secondary supplies of uranium decrease and as new reactors under construction come on stream, the demand for primary uranium will rise appreciably and temporary shortages may result. Although known world resources of uranium are more than adequate to fuel the world's reactors for several decades, the licensing, construction and commissioning of new uranium mines is a lengthy process (5-10 years), making it essential that exploration and mine development now proceed expeditiously.

  • Where are uranium deposits located?

    Uranium deposits are found all over the world. The largest deposits of uranium are found in Australia, Kazakhstan and Canada. High-grade deposits (>20% U3O8) are only found in Canada.

  • What is Uranium used for?

    The principal use for uranium is in nuclear fuel for power generation. Approximately 16% of the world's electricity is generated from nuclear reactors, and it is growing in popularity given declining fossil fuel supplies and increased pressure to use cheaper, cleaner (i.e. low-carbon) forms of energy.

    By the time it is completely fissioned, one kilogram of uranium can theoretically produce about 20 trillion joules of energy (20×10 12 joules), or as much electricity that 1,500 tonnes of coal could yield.

    Commercial nuclear power plants generally use uranium whose 235U isotope has been enriched to around 4-5%. CANDU heavy water reactor, however, have traditionally used natural uranium whose 235U isotope concentration is 0.71%. Fuelling of heavy water reactors with uranium that has been slightly enriched to approximately 0.85% is now underway and significantly reduces fuel costs. Fuel used in nuclear submarine reactors is typically highly enriched to 90-95% 235U. In a breeder reactor, uranium-238 can also be converted into plutonium through the following reaction: 238U (n, gamma) -> 239U - (beta) -> 239Np - (beta) -> 239Pu.

  • How do you find uranium deposits?

    Today's exploration activities are much more complex than in the past, for the surficial, easily-discovered deposits have, for the most part, been located. With the highest-grade deposits buried in deep rock formations, advanced technologies like satellite imagery, geophysical surveys, multi-element geochemical analysis and computer processing must be employed. Once geologists locate a prospective deposit, detailed geological and economic evaluation of the grade and characteristics of the ore body must be completed.

    Once a deposit with sufficient reserves is discovered mining engineers develop a mining plan to extract the ore. If the project looks promising, environmental impact assessments and the public consultation process begin so that applications can be made for regulatory approvals and necessary licenses. When permits and licenses are in place, mine development and construction of surface facilities, including mills to extract the uranium, access roads, utilities and worker facilities, can begin. The timeline from discovery of an ore body to electricity production can span many decades.

  • How is uranium mined?

    Uranium ore is removed from the ground in one of three ways depending on the characteristics of the deposit and the value of the uranium (as the price of uranium rises, formerly uneconomic deposits may become economic). Uranium deposits close to the surface can be recovered using the open pit mining method, while underground mining methods are used for deep deposits. Given the right hydrology and geology, the ore may be mined by in situ recovery (ISR) leaching; a process that dissolves the uranium by circulating oxygenated solutions through the uranium-bearing rock formations. In 2006 worldwide production of uranium came from underground (41%), open pit (24%) and ISR mines (26%). As mentioned earlier, uranium frequently occurs as a trace element in other mineral deposits such as copper, gold or phosphates. Approximately 9% of the 2006 worldwide uranium production originated from such by-product recovery operations.

  • Open pit mining

    When uranium ore is present within 100-200m of the surface, it is typically extracted with open pit mining techniques. Open pit mining begins by removing overburden (soil) and waste rock that overlies the ore body to expose the uranium mineralization. Then a pit is excavated to access the ore. The walls of the pit are mined in a series of benches to prevent them from collapsing. To mine each bench, holes are drilled into the rock and loaded with explosives, which are detonated to break up the rock. The resulting broken rock is then hauled to the surface in large trucks that carry up to 200 tonnes of material at a time.

  • Underground mining

    When an ore body is located more than 100 metres below the surface, underground mining methods are necessary as the costs to remove the overlying rocks (overburden) would be prohibitive. For example, Cameco's McArthur River ore body is located more than 500 metres below the surface and is mined using an underground mining method. The first step in underground mining is to access the ore. Entry into underground mines is gained by digging vertical (or inclined) shafts to the depth of the ore body. Then a number of tunnels are cut around the deposit. A series of horizontal tunnels, called drifts, offer access directly to the ore and provide ventilation pathways. All underground mines are ventilated, but in uranium mines, extra care is taken with ventilation to minimize the amount of radiation exposure and radon inhalation. In most underground mines the ore is blasted and hoisted to the surface for milling. At McArthur River, due to the potential for radiation exposure from the high-grade ore, processing systems must ensure worker safety. As a result, the ore is processed underground to the consistency of fine sand, diluted with water and pumped to the surface as a slurry or mud. The slurry is trucked to the Key Lake site for milling.

  • In situ Recovery

    In certain sandstone deposits geological and hydrological conditions allow uranium to be dissolved directly by pumping an oxygenated lixiviant underground where it dissolves the uranium, pumping it back to the surface, extracting the dissolved uranium in ion exchange columns and recycling the barren solution back underground to repeat the process. With this in situ recovery (ISR) process there is limited surface environmental disturbance. Leaching is another word for dissolving and 'in situ' means in the original position or place. A majority of the uranium produced in the USA, Kazakhstan and in Western Australia is produced by this environmentally benign and comparatively inexpensive technology.

  • Reprocessing

    After being in a nuclear reactor for approximately 18 months, a portion of the nuclear fuel must be replaced with new fuel. The used (spent) fuel contains upwards of 95% of the 235U that was in the fresh fuel, plutonium (created when 238U absorbs a neutron) and actinide wastes from the fission process. Reprocessing is the chemical separation of spent fuel into these three components. The 235U can again become reactor fuel. The plutonium can be blended with natural UO2 to create mixed oxide fuel (MOX), a fuel used in some reactors in Belgium, Germany, France and Switzerland. The actinide waste is placed in secure storage for eventual permanent disposal in an underground repository.

    While the costs of reprocessing outweigh its benefits at the present time, Russia and some European countries reprocess used fuel for environmental reasons or as a result of political policy. As well, countries like Japan are turning to reprocessing because they lack domestic fuel sources and wish to be energy independent.

  • How is nuclear fuel waste handled?

    Radioactive waste is generally divided into three categories depending on its level of radioactivity: low, intermediate and high-level waste.

    Low-level waste includes slightly contaminated clothing and items that come from nuclear medicine wards in hospitals, research laboratories and nuclear plants. Low-level waste contains only small amounts of radioactivity that decays away in hours or days. After the radioactivity has decayed, low-level waste can be treated like ordinary garbage.

    Intermediate-level wastes mostly come from the nuclear industry. They include used reactor components and contaminated materials from reactor decommissioning. Typically these wastes are embedded in concrete for disposal and buried in licensed landfills.

    High-level waste primarily generally describes used fuel from nuclear reactors. Used nuclear fuel assemblies are removed from a reactor and placed into large water-filled pools for 10-20 years. The water provides shielding from the radiation and cooling to remove the heat, which continues to be generated by the radioactive material. When the radioactivity and its associated heat have diminished, the fuel is transferred to canisters for above-ground, medium-term, dry storage. The nuclear industry and government authorities are evaluating long-term storage of high-level waste. While spent fuel is safely stored at nuclear plant sites today, the storage facilities were never intended for permanent storage. Countries operating nuclear power reactors are conducting extensive studies on how high-level wastes should be disposed. Research indicates the ideal permanent storage disposal is in deep underground caverns (or repositories) in stable geological formations.

    At present, no country has constructed a repository, although considerable research is underway on a variety of different geologies. Belgium, for example is studying permanent disposal in a clay formation. The US is investigating the suitability of the volcanic tuffs of Yucca Mountain in Nevada. The site received government approval in 2002 and is now in the multi-year process of licensing application. Finland is the closest to implementing disposal of high-level

  • Nuclear Industry in Argentina

    Argentina is a leading Latin American generator of nuclear power. The country embarked on ambitious nuclear energy and technology development programs in the mid-1950s. These programs encompassed the exploration and mining of uranium, development of a complete nuclear fuel cycle, construction and operation of nuclear reactors, production of medical isotopes and the design and manufacture of industrial irradiators. Argentina's pioneering nuclear program led to development of indigenous technologies for uranium enrichment and used fuel reprocessing.

    Argentina created the National Commission for Atomic Energy (CNEA) in 1950 to coordinate its diverse nuclear activities, including the mining and processing of uranium. CNEA owns minority stakes in companies that produce heavy water, refine and enrich uranium and manufacture reactor fuel elements, Zircaloy cladding and fuel assemblies. Uranium exploration and mining are now primarily private sector activities, but CNEA does retain responsibility for nuclear R&D and the environmental restoration of former nuclear sites. In 1994 the government set up Nucleoeléctrica Argentina S.A. (NASA) to take over ownership and operation of the country's power reactors from CNEA and to oversee expansion of the reactor fleet. A 1996 law allowed the privatization of NASA, but this has yet to occur. Both CNEA and NASA report to the Secretary of Energy within the Ministry of Planning, Investment and Services. An autonomous Nuclear Regulatory Authority (ARN) regulates all nuclear industry activities including radiation protection and nuclear safety, physical protection and safeguards.

    Argentina's nuclear power program is centered on heavy water reactors fuelled by natural uranium. Two nuclear power plants are in operation: Atucha I, a 360 megawatt (MWe) net pressure heavy water reactor (PHWR) which has operated since 1974, and Embalse, a 650 MWe CANDU reactor that was connected to the national grid in 1983. Their combined output now satisfies approximately 10% of the national electricity demand. Argentina pioneered the use of slightly enriched (0.85% 235U) uranium fuel rather than natural uranium (0.71% 235U) in its heavy water reactors, a change that doubled fuel burn-up and reduced operating costs by 40%.

  • Uranium Exploration and Production in Argentina

    Forty years of CNEA-sponsored uranium exploration that included limited airborne geophysical and radiometric surveys led to the discovery of several uranium districts, such as Sierra Pintada (Mendoza), Don Otto (Salta) and Cerro Solo and Cerro Condor (Chubut). CNEA produced uranium from several deposits through conventional underground or open-pit techniques. The collapse of worldwide U3O8 prices in the 1980s and Argentina's multiple financial crises led to the abandonment of uranium exploration and mining by CNEA in the late 1990s.

    CNEA conducted exploration at both a regional and local scale through the early 1990s with the support of IAEA Technical Cooperation projects, but a majority of the country remains under-explored (or unexplored) and its true resource potential remains to be evaluated. No systematic exploration was conducted in many promising areas, such as Rio Negro Province.

    Between the mid-1950s and 1999 the International Atomic Energy Agency (IAEA) reports that Argentina's cumulative uranium production totalled 2,509 tU from seven open pit and heap leaching production centres. Annual production averaged 30 tU through 1976, rising to approximately 140 tU annually during the 1976-1988 period (with a peak production of 187 tU in 1980). Argentina has had no uranium production since 1999.

    Argentina uranium resources listed in the joint OECD Nuclear Energy Agency-IAEA "Red Book" (Uranium Resources, Production and Demand 2005) total only about 15,000 tU, although CNEA estimates that there are 55,000 tU contained in "exploration targets." Establishing the true resource base must await completion of more detailed exploration by private sector companies using modern technologies and current geologic models.

    Exploration for new uranium deposits is currently focused on provinces that had historic production (Mendoza, Chubut, Salta) as well as others that have good geological potential (e.g. Rio Negro, Jujuy, Catamarca). Mining of uranium by means of in-situ (or solution) leaching technology has never been attempted in Argentina. In-situ recovery (ISR) has many benefits over the conventional open pit or underground mining methods previously used by CNEA, including minimal environmental impacts, appreciably lower capital and operating costs and greater public and stakeholder acceptance. Uranium occurrences in Patagonian provinces appear to have the ideal geological and hydrologic properties that would permit exploitation with the ISR technique.

    In the absence of any domestic uranium production, Argentina fuels its two heavy water reactors with uranium imported primarily from Europe and Canada. Approximately 125 tU are required annually, an amount that will likely increase to 215 tU in 2010 following commissioning of the Atucha II reactor (assuming reactor load factors of 90%, burn-ups of 8 GMD/tU and natural uranium fuel).

  • Future Plans for the Argentine Nuclear Industry

    Argentina has one of the largest and most important Latin American economies with a gross domestic product (GDP) that has risen by 8-9% annually since 2003. This high level of economic growth has led to a corresponding increase in the demand for electricity, a majority of which (approximately 55%) is now generated in natural gas-fired thermal plants. The balance of the country's electricity originates from hydropower (35%) and nuclear (10%). An energy crisis in 2004 led to imposition of economic controls that kept energy prices low, caused energy demand to outstrip supply, and threatened to stifle the country's nascent economic recovery. Capital investment in new generating capacity dried up. The return of political stability and robust economic growth has caused electricity demand to increase by approximately 3% annually since 2005. Argentina's electricity production is now largely privatized and has an installed generation capacity of approximately 35 GWe. Private and state-owned companies produce electricity in a competitive, mostly-liberalized market with about 11% of the country's generation originating from autoproducers and private generators. Nuclear power generation opened to private investment, but memories of the country's 2002 default on its $155 billion sovereign debt and the large capital investment needed for new reactor construction ($4-6 billion per nuclear station), have not yet attracted foreign investment, thereby leaving operation of the existing and planned reactors with NASA.

    Argentina is a signatory to the 1997 Kyoto Protocol to the United Nations Framework Convention on Climate Change and established voluntary emissions targets ('Federal Emissions Goals') related to GDP and macroeconomic scenarios. The federal government recently promulgated national energy policies that encourage greater use of hydropower and nuclear energy to achieve these targets and to mitigate problems of urban and industrial air pollution.

    Argentina has made nuclear energy a priority to meet its energy needs and to sustain economic growth. In an August 2006 policy statement it announced an 8-year, $3.5 billion strategic plan for the country's nuclear power sector that included the following components: complete construction of the 80% built, 745 MWe Atocha II power reactor, reactivate the 200t/y Arroyito heavy water production plant, extend the operating life of the Embalse reactor for an additional 25 years, and initiate feasibility studies to start construction in 2010 of one, and possibly two, 740 MWe CNADU-6 reactor(s) at Embalse. After a twenty year hiatus Argentina proposes to resume uranium enrichment at its Pilcaniyeu complex in Neuquén Province using its indigenous SIGMA advanced diffusion enrichment technology. The government will also support commercialization of the CAREM, a small, Argentine-design modular, 25-100 MWe light water reactor which is designed for operation in remote areas or small cities. By doing so Argentina will remain a country that is recognized as having the right to enrich uranium along with other leading nuclear powers including, for example, Brazil, USA, Russia, France and the UK .

    The federal government, through CNEA, has recently signed an agreement with the Salta Province government to study re-opening of the Don Otto mine which was shut down in the 1990s due to depressed uranium prices. It also supports reopening the Sierra Pintada mine and exploration in Catamarca province to make the country self-sufficient in uranium. Resumption of national uranium production is a government priority and consistent with its policy to encourage growth of nuclear power generation. Domestic production is also desirable to ensure the country's energy security and independence, particularly in light of its limited fossil fuel resources.

  • The Argentine government's aggressive strategy to open mineral exploration and development to private investment in 1992 prompted a tremendous expansion in the sector. A new and highly competitive fiscal and legal framework for mining investment was the key to this transition. The cornerstones of the new framework are: the Mining Investment Law (1993), which offers investment schemes and guarantees fiscal stability of the tax burden, the Federal Mining Covenant (1993), which defines consensus policies between federal and provincial authorities, and revisions to the 1887 Mining Code which now incorporates provisions of the Law of Environmental Protection for Mining (1995). The 1877 Mining Code acts as a management framework for the coordination of national and provincial powers in issues such as mineral tenure, environmental regulation and uniformity of application of mining regulations. Procedural rules are, however, entrusted to provincial authorities, all of which have uniformly adopted the concession system to grant mineral rights to the private sector.

    The 1877 Mining Code is the principal federal regulation that governs mining activities and contains regulations for the general extent of concession, technical requirements, concessionaire obligations and concession limitations. Modernization of the country's mining legal and investment regulations and policies allowed Argentina to incorporate many characteristics of other successful mining legal regimes. These include regulations on the security and transferability of title, modernization of mining cadaster, concession access, transparency and accountability in the licensing of mineral concessions, and specification of mining right obligations. Exploration concessions -- provided that certain requirements are met -- are now perpetual. Filings for prospecting and exploration rights are now simple and inexpensive and limitations on prospecting and exploration of uranium and minimum investment requirements have been removed.

    Argentina's environmental legal framework does require some strengthening to include specific goals and measures and technical guidance to protect the environment in the various phases of mining (exploration, production, decommissioning). Other issues that should be addressed include financial assurance, closure planning, public participation, and measures and actions to minimize adverse environmental impacts.

    Consistent with its decision to transfer all nuclear activities to the private sector, the government recently announced national treatment of uranium mining and policies to encourage investment of foreign and domestic capital into such activities. However, each Argentine province has its unique concession regulations and mining procedural laws that require understanding and interpretation. Concession authorities are placed under different jurisdictions on each province, thereby making concession proceedings and environmental approvals dependent upon provincial jurisdictional authorities.

    Uranium mining and nuclear power generation are open to full private ownership. There are no restrictions on the participation of local and/or foreign private companies in uranium exploration or production or in the export and sale of mineral output at world market prices. Uranium had been classified as a strategic mineral, but the 1990s revisions to the mining code downgraded its status to a common mineral. The Argentine senate is now considering legislation that would re-categorize uranium as "strategic" and prevent its export "...so long as the amount that the country needs for operations is not being met..." and require all sales to be made to CNEA at market prices. The likelihood of this legislation becoming law is unknown.

    Argentina has replaced its history of institutional instability with full-fledged free enterprise, programs of economic reform and an unparalleled privatization program, especially in mining and electrical power generation. It liberalized its economy to encourage domestic growth and to attract foreign investment, particularly in the energy field. Its foreign investment policies are very progressive and pro-business and authorize, for example, the equal treatment of foreign and local investors and repatriation of capital and profits without government pre-approval. Argentina has entered into Bilateral Investment Treaties (BITs) with all of its trade and investment partners to protect against capital movement restrictions and expropriations and to resolve investment disputes.

    According to the World Bank's latest "Doing Business" survey, Argentina in 2007 ranked 109 out of 178 nations surveyed in "ease of doing business." This survey, which considers issues such as starting a business, employing workers, dealing with licenses, registering property, getting credit and protecting investors, attributes this low showing to a punitive tax system, delays in legal reforms and a lack of reforms in the insolvency process.

  • Worldwide Uranium Market

    The world's 443 operating nuclear reactors generate 370 GWe of electricity annually which corresponds to 16% of worldwide electricity production. A new 2007 report from the IAEA, entitled Energy, Electricity and Nuclear Power for the Period up to 2030, forecasts an approximately 2.5%/yr increase in nuclear generation to 447-679 GWe by 2030. This increase is fuelled primarily by burgeoning demand from emerging Asian economies as well as concerns about security of energy supply and the need to reduce greenhouse gas emissions. The IAEA notes that 16 of the 31 new reactors under construction at the end of 2006 were mostly in China and Asia. China, which currently derives less than 3% of its energy from nuclear, forecasts a five-fold increase in nuclear generation by 2020 and India plans an eight-fold increase by 2022.

    Uranium requirements for the world's nuclear reactors in 2006 are estimated by the World Nuclear Association (WNA) to be 64,200 tU. This demand is forecast to rise to 64,700 tU in 2010, to 81,000 tU in 2020 and finally to 109,100 tU in 2030 based on assumptions of new reactor builds, fuel management (tails assays) strategies and anticipated mine production capabilities. World primary uranium production, however, has averaged only 40,000 tU annually over the last few years and filled only 62% of reactor requirements in 2006. The gap between uranium demand and primary uranium supply (24,200 tU for 2006) has been met by uranium from secondary supplies, including the downblending of ex-military supplies of Russian and USA Highly Enriched Uranium (HEU), reprocessing of used nuclear fuel, re-enrichment of depleted uranium tails, and liquidation of utility and US Department of Energy surplus inventories. Secondary supplies of uranium will diminish over time and are forecast to play a decreasing role in fulfilling reactor fuel needs.

    Canada, Australia and Kazakhstan are the major producers of primary uranium and accounted for about 60% of the world's primary uranium in 2006. Production primarily came from underground (41%) and open pit (24%) mines, with lesser amounts from by-product operations (e.g. from phosphate, gold, base metal mines)(9%) and ISR (26%). The Red Book reports Identified Resources that can be recovered at a cost less than US$130/kg (or approximately US$50/lb U3O8) total 4.74 million tU, or approximately 75-80 years' production at current rates of consumption. Thus, there are very adequate known supplies of uranium to support the plans for new reactor construction and operation. However, development of these Identified Resources will be dependent on regulatory and environmental considerations, financing, amenability to economic mining methods and political factors.

    Consideration of primary uranium production from new and existing mines, as well as available secondary supply sources, indicates that there should be adequate supplies of uranium to meet the fuel demands from the world's expanding fleet of reactors. Commissioning of new mines is a time-consuming process subject to regulatory delays, stakeholder challenges, fiscal policies in the host countries and market conditions. The thirteen-fold increase in world uranium price from 2003 through mid-2007 has prompted a flurry of new exploration activity throughout the world both by juniors and major players. The production from these new sources will be needed to meet the uranium fuel demands of the world's expanding nuclear fleet staring in the 2015-2020 period.

    Written by Dr. Clifton Farrell

References

  1. Uranium Resources, Production and Demand 2005 ("Red Book"): Organization for Economic Cooperation and Development (OECD) and the International Atomic Energy Agency (IAEA), 2006
  2. Energy Balances for Argentina: International Energy Agency (IEA) Energy Statistics, 2007
  3. 2006 Policy statement
  4. Argentina: Mining Prospecting and Exploration Legal Framework -- Guidelines for Foreign Investors: Beretta, Omar and Garcia, Lucas, Mondaq Inc.,2007
  5. Bill Seeks to Ban Uranium Exports: Business News America, 16 October 2007
  6. Doing Business 2008: Comparing Regulation in 178 Economies: World Bank, 2007
  7. Argentina Sets Course for Nuclear Power, Enrichment: Deutsche Presse-Agentur, 23 August 2006
  8. The Global Nuclear Fuel Market -- Supply and Demand 2007-2030: World Nuclear Association, 2007