The increase of uranium production is part of the existing Energy Strategy of Russia, which is designed until 2020 and which involves the increase of the share of nuclear power in the total energy balance of Russia from the current 16% to 23% by 2020, with an increase in nuclear power generation from 130 to 230-300 billion kw/h per year.
Amid the ongoing financial crisis in Russia, the Russian government has designed a package of measures, aimed at the supporting of the national uranium industry and creation of conditions for a significant expansion of uranium production in the country during the next several years.
According to Vladimir Verkhovtsev, General Director of ARMZ Uranium Holding Co., Russia’s leading uranium mining company, currently the domestic production fully meets Russia’s needs for uranium, however there is a possibility that such situation may change in the future.
This is mainly due to the planned commissioning of new nuclear power capacities in Russia during the next several years, which may lead to a shortage of uranium in the country already by 2025. Verkhovtsev has also added that the same problem may be observed in the EU countries.
Among the support measures, which have preliminary been approved by the Russian government is the introduction of preferential tax regime for the domestic uranium producers and the elimination of bureaucratic hurdles in the industry. The latter means simplification of the procedure for the provision of domestic uranium fields to local mining companies.
It is planned that a particular attention of the state is expected to be paid for the support of the JSC “Argun Industrial Mining and Chemical Enterprise”, Russia’s largest facility for the production of uranium, which is based in the city of Krasnokamensk, a town in the Krasnokamensky District of the Zabaykalsky Krai.
According to Victor Svyatetskii, executive director of ARMZ, one of the possible measures of state support may involve the provision of state subsidies for the commissioning of the mine No 6 at the Argun Enterprise, that requires investments in the amount of 30 billion rubles (US$400 million).
Svyatetskii has also added that the new mine should be commissioned no later than 2022, otherwise further production of uranium at Argun will become loss-making.
Victor Svyatetskii comments: “The launch of the new mine will allow the company to stay profitable for decades, while its capacity will amount to 3,000 tonnes per year. In the structure of ARMZ the No 6 mine accounts for 18% of all stocks of the holding, while in the case of Argun, this figure is estimated at 40% of all the reserves of the enterprise”.
The increase of uranium production is part of the existing Energy Strategy of Russia, which is designed until 2020 and which involves the increase of the share of nuclear power in the total energy balance of Russia from the current 16% to 23% by 2020, with an increase in nuclear power generation from 130 to 230-300 billion kw/h per year.
It is planned that Russia, along with France, will continue to remain the main global lobbyists of nuclear power during the next several decades, being not ready to cut on the already existing nuclear power capacities.
Formally, the mineral resources base of uranium in Russia is estimated at more than 600,000 tonnes of reserves and 830,000 tonnes of predicted resources.
However, the development of the majority of these reserves is associated with the cost of US$80/ kg, which, amid the current market conditions, is considered as too high for the majority of Russian and global uranium investors.
Overall, according to optimistic expectations of the Russian government, up to 16,000 tonnes of uranium per year will be produced in Russia by 2020.
investorintel.com
