MINEX Forum

Tag: Kazatomprom

  • National Atomic Company Granted License for Mineral Exploration at Budenovskoye Deposit

    National Atomic Company Granted License for Mineral Exploration at Budenovskoye Deposit

    The National Atomic Company has been granted a license to explore mineral deposits at Site No. 5 of the Budenovskoye field in the Turkestan region, according to the press center of Kazatomprom. This site is located to the northeast of the southern flank of the field and is considered a promising area for further exploration.

    The company will conduct geological exploration in this part of the Mynkuduk ore district for the next six years. Kazatomprom’s Chairman, Meirzhan Yusupov, emphasized that this new site plays a key role in the company’s strategy to increase uranium reserves.

    Experts anticipate long-term exploitation of the area due to favorable geological conditions and the well-developed transportation and energy infrastructure. Site No. 5 effectively extends the Inkai deposit southward. Preliminary estimates suggest the area holds over 18,000 tons of uranium. Kazatomprom expects a significant increase in resources following the exploration results.

    The company highlighted the high productivity of the ore in this region. Last month, Kazatomprom announced joint projects with Tajikistan’s TajRedMet in the uranium and rare-earth sectors.

  • North American Uranium Stocks Surge Following Kazatomprom’s Disappointing Production Outlook

    North American Uranium Stocks Surge Following Kazatomprom’s Disappointing Production Outlook

    Uranium-focused investors in North America are rapidly investing in uranium mining companies after the world’s largest producer, Kazatomprom, released production guidance that fell short of market expectations. Shares in North American uranium miners are experiencing a significant rise in premarket trading after Kazakhstan’s state-owned uranium company announced it would produce between 25,000 tons to 26,500 tons of uranium next year. Although this is an increase compared to 2024 levels, analysts note that it falls short of the company’s subsoil use agreements in Kazakhstan.

    Adam Rodman, founder of Segra Capital Management, commented on Friday that this revised outlook brings the entire production curve down for several years, describing it as a “miss.” Rodman indicated that as a result, he would be increasing investments in North American uranium miners, including companies like NexGen Energy Ltd., where Segra Capital already holds shares.

    US-listed uranium stocks have already begun to soar in response. Cameco Corp. shares rose by as much as 7.2% in premarket trading, NexGen Energy’s US shares surged by nearly 13%, and Uranium Energy Corp. approached a 10% increase.

    Rodman also pointed out that Kazatomprom’s low production guidance might require the company to seek regulatory approval to downgrade its production targets for the year at several key sites. Despite Kazatomprom’s guidance suggesting a 7.1 million pound “ramp-up,” BMO Capital Markets analyst Alexander Pearce noted that the uranium market is expected to remain in a deficit.

  • Kazatomprom Raises 2024 Uranium Production Guidance After Strong First Half

    Kazatomprom Raises 2024 Uranium Production Guidance After Strong First Half

    Kazakhstan’s Kazatomprom (LON: KAP) announced on Thursday that it has raised its production guidance for 2024following an increase in output during the first half of the year. The world’s top uranium producer now expects to produce between 22.5 million and 23.5 million tonnes of uranium in 2024, up from the previous guidance of 21 million to 22.5 million tonnes.

    The updated forecast comes after the company boosted its uranium production by 6% year-on-year in the first half of 2024, reaching 10,857 tonnes. Production on an attributable basis rose 7% to 5,797 tonnes.

    Despite the increase in production, Kazatomprom and its subsidiaries experienced an 18% decrease in sales in the first half of the year, totaling 7,779 tonnes. However, the average price of uranium concentrate surged by 41% to $66.22/lb.

    Earlier this year, uranium prices soared to a 15-year high of $104/lb due to tight supply and rising demand. The company noted that average realized prices for the second quarter and the first half of 2024 were higher than in the same periods of 2023, primarily due to an increase in the uranium spot price.

    “The company’s current contract portfolio pricing reflects uranium spot prices. However, some long-term contracts for 2024 include fixed pricing components and price ceilings that were set during a period of lower prices,” Kazatomprom said in a statement.

  • Kazatomprom Begins Geological Exploration at the Eastern Section of Zhalpak Deposit

    Kazatomprom Begins Geological Exploration at the Eastern Section of Zhalpak Deposit

    Kazatomprom, the leading uranium company in Kazakhstan, has received permission to conduct geological exploration at the Eastern section of the Zhalpak deposit. This authorization will enable the company to investigate and refine the uranium reserves in this area. Previously, exploration funded by Kazatomprom discovered uranium deposits of categories P1 and P2. The potential reserves at the Zhalpak deposit are preliminarily estimated at 30 thousand tons of uranium. The new geological exploration aims to convert these resources into reserves of categories C2 and C1 and to determine more accurate uranium reserves. The exploration project is planned for six years, after which the calculated reserves will be recorded on the state balance sheet. Currently, Kazatomprom is extracting uranium from 26 deposits and accounted for about 20% of the world’s primary uranium production in 2023.

     

  • Changes in Uranium Mining Tax Rates Announced for 2025

    Changes in Uranium Mining Tax Rates Announced for 2025

    In 2025, the Republic of Kazakhstan will see a change in the mineral extraction tax (MET) rate on radioactive metals, according to the press center of the atomic company Kazatomprom. Starting from the first day of the new year, the tax on the extraction of valuable minerals will be set at 9%. From 2026, a differentiated tax will be introduced, allowing the MET rate to vary between 4% and 18%.

    The rate will depend on the actual amount of uranium extracted under each specific contract, as well as the cost of natural uranium concentrate. If the annual extracted volume is up to 500 tons, the enterprise will be taxed at 4%. For annual production levels up to 1,000 tons, the rate will rise to 6%, up to 2,000 tons — 9%, up to 3,000 tons — 12%, and up to 4,000 tons — 15%. If more than 4,000 tons of uranium is mined in a year, the MET will reach 18%.

    It is important to note that if a certain weighted average price of uranium is exceeded, the tax rate will increase. For example, if the average cost exceeds $70 per pound of concentrate, the tax rate will increase by 0.5%. If the price surpasses $110 per pound, an additional 2.5% will be added to the existing rate.

    Until the end of 2024, uranium companies will continue with the current taxation procedure. Since January 1 of last year, the MET has been 6%. The management of Kazatomprom expects that in 2026, all subsidiaries and joint ventures of the national company will be able to benefit from the differentiated tax calculation approach.

  • Kazatomprom Signs New Contract for Mining Operations at Inkai Deposit

    Kazatomprom Signs New Contract for Mining Operations at Inkai Deposit

    Kazatomprom JSC has signed another mining contract. The agreement involves extracting radioactive metal from the subsurface of site No. 3 at the Inkai deposit. The relevant documents were signed following negotiations with the Ministry of Energy of Kazakhstan. This contract is crucial for the national company as it will significantly increase its mineral resource base, according to the operator’s press center.

    According to Kazatomprom, obtaining the license will allow the extraction of 701 tons of metal over the next four years. It is noteworthy that Inkai holds significant uranium reserves and is one of the main uranium deposits in the country. Experts estimate the reserves at the site to exceed 83,000 tons. Furthermore, developing these resources will positively impact the Turkestan region.

    Additionally, the company believes that in the future, the contract for the right to develop this area will go to Kazatomprom-SaUran LLP, a subsidiary of the current operator.

  • Stepnogorsk Sulfuric Acid Plant Plans Capacity Doubling to Meet Kazatomprom’s Needs

    Stepnogorsk Sulfuric Acid Plant Plans Capacity Doubling to Meet Kazatomprom’s Needs

    The Stepnogorsk Sulfuric Acid Plant (SSAP), 90.11% owned by Samruk-Kazyna’s subsidiary, with the remaining 9.89% belonging to Kazatomprom (another Samruk-Kazyna subsidiary), intends to double its capacity to 360,000 tons per year of sulfuric acid, required by Kazatomprom, and increase sulfur purchases from Tengizchevroil, the main supplier of the product to the plant. The implementation of the proposed activity – the construction of the second line of the sulfuric acid plant – will lead to an increase in the production capacity of the enterprise, producing technical sulfuric acid, from 180,000 tons to 360,000 tons per year, according to materials for public hearings on the project’s second phase, scheduled for April 30. As indicated on the plant’s website, the main sulfur supplier for the enterprise is the Tengiz oil field operator – Tengizchevroil, which stores sulfur in large volumes. Accordingly, with the launch of the second phase, the plant will double its sulfur purchases necessary for sulfuric acid production. The main product of the plant is technical sulfuric acid of the first grade according to GOST 2184-2013 with a concentration of 92.5–94%. The project also includes the possibility of obtaining acid with a concentration of 98.5% (without additional dilution). By-products of production include electrical and thermal energy. Construction and installation work is planned to be carried out around the clock in 2024-2025, and the launch of the second phase into operation is scheduled for 2026. The second phase will produce sulfuric acid around the clock for 345 days a year. The plant fully meets its own needs for thermal and electrical energy. According to materials for public hearings, the production of sulfuric acid from the second phase will provide the plant with about 30–40 MW of electricity through the generation of superheated steam. At the same time, the plant annually concludes a contract for the supply of electricity with Stepnogorskenergosbyt. The main equipment supplier will be the Italian company Desmet Ballestras.p.a., and the main technological equipment manufacturer will be the Kazakhstani company “Belkamit”. The second phase will be built within the boundaries of the existing plant, which will not cease its operation during production expansion. The sulfuric acid plant is located in the industrial zone of the city of Stepnogorsk in the Akmola region. The nearest settlements are Zavodskoye village – three km away – and the city of Stepnogorsk – 18 km away. The nearest railway stations are AltynTau – 10 km away and Ermantau – 130 km away. The plant has been operating at its full capacity since 2021 against the backdrop of sulfuric acid shortages in Kazakhstan, which is needed for uranium mining. In January, Kazatomprom announced an expected adjustment to its production plan for 2024 due to difficulties in sulfuric acid supplies, which is a key component in uranium mining. A plant for the production of 800,000 tons of sulfuric acid will be built by 2026 in the Turkestan region using the Italian Balestra technology, announced Nurlan Zhakupov, Chairman of the Management Board of Samruk-Kazyna. It is worth noting that Baurzhan Ibraev, Chairman of the Advisory Board of the British New Nuclear Watch Institute (NNWI) for Central Asia, who had been a member of the Board of Directors and Chief Production and Nuclear Fuel Cycle Director of Kazatomprom for several years, expressed his opinion to journalists at a seminar on atomic energy in December 2023 that increasing uranium production in Kazakhstan in the coming years, according to the plans announced by Kazatomprom and its affiliated joint ventures, will require about 3 million tons of sulfuric acid annually. “For acid, we will need – today we consume about 2.2 million tons. If we want to fulfill the announced plans, probably, we will need no less than 3 million tons. Unfortunately, Kazakhstan today does not produce so much… At one time, production capacities in Kazakhstan were around 3.6 million tons, but this does not mean that they produced so much. I don’t know how much everyone produces today, but I know that today Kazatomprom does not satisfy its acid needs,” he said. According to his estimates, Kazatomprom’s joint ventures purchased sulfuric acid at a price of $130 per ton. Expenditures on this key component, used in uranium mining by the method of underground in-situ leaching as a chemical reagent, accounted for about 30–40% of the total cost of uranium in Kazakhstan. However, even now, before the increase in production volumes by Kazatomprom, there is a sulfuric acid deficit in Kazakhstan, Ibraev noted. In contrast to this, uranium enterprises in Uzbekistan, according to him, receive sulfuric acid at $30 per ton.

  • Kazatomprom Successfully Completes Uranium Concentrate Delivery to Romanian Energy Company

    Kazatomprom Successfully Completes Uranium Concentrate Delivery to Romanian Energy Company

    The National Atomic Company “Kazatomprom” (hereinafter referred to as “Kazatomprom” or the “Company”) announces the successful completion of uranium concentrate deliveries to the energy company Societatea Natională “Nuclearelectrica” S.A. (“SNN”). SNN is Romania’s state-owned company in the field of electricity and heat supply, engaged in nuclear fuel production, and operates the Cernavodă Nuclear Power Plant, which accounts for approximately 20% of the country’s energy production.

    In December 2022, Kazatomprom was declared the winner of an open tender by SNN for the supply of uranium dioxide for Romania’s nuclear energy needs. In accordance with the contract terms, the Company delivered natural uranium to the SNN plant. Kazatomprom exported its product through the Trans-Caspian International Transport Route (TCITR), which the Company has actively utilized since 2018.

    Recognized as a reliable and preferred supplier in the global nuclear fuel market, Kazatomprom will continue diversifying its supply geography and exploring new sales markets.

  • Kazatomprom: Nuclear Power Demand Surges Amid Geopolitical Uncertainty

    Kazatomprom: Nuclear Power Demand Surges Amid Geopolitical Uncertainty

    Kazatomprom’s CEO, Meirzhan Yussupov, highlighted a significant surge in the demand for nuclear power amidst geopolitical tensions in 2023. Yussupov stated that despite the challenges, the demand for nuclear energy, being a stable and low-carbon source, notably increased. With Kazakhstan contributing around 40% of the global uranium production annually, Yussupov proudly mentioned that approximately every third nuclear reactor worldwide is powered by Kazakh uranium.

    The company emphasized its role in the energy security agenda amidst ongoing global geopolitical uncertainties. Operating in an ESG-compliant and low-risk jurisdiction, Kazatomprom positions itself as a reliable supplier of natural uranium, ready to cater to utilities’ needs in diversifying their supply sources.

    Addressing the impacts of international sanctions, Kazatomprom reiterated its commitment to assessing and monitoring sanctions risks continuously. The company has developed action plans to mitigate negative impacts on its activities, adapting them to evolving risks and updates.

    Regarding financial resilience amid geopolitical tensions, Kazatomprom stated that events in Ukraine have not affected its financial position significantly. Majority of its revenues are in US dollars, providing a natural hedge against currency risks.

    The company has taken cautious steps regarding operations involving Russian banks under active international sanctions processes. Additionally, it continues to assess risks associated with its contracts, such as uranium processing with entities in the Russian Federation.

    Despite potential challenges in transportation due to sanctions, Kazatomprom assures uninterrupted supply to end customers, thanks to continuous monitoring and the Trans-Caspian International Transport Route.

    Regarding proposed US legislation on Russian enriched uranium imports, Kazatomprom clarified that it wouldn’t impact its primary business of natural uranium production.

    The company reported a significant revenue increase in 2023, attributed to higher average realized prices, increased sales volumes, and revenue growth from fuel assembly and rare metal products segments.

    Looking ahead, Kazatomprom expects uranium production volumes for 2024 to remain consistent, but acknowledges uncertainties due to construction delays at new sites, which may affect operating performance.

  • Kazatomprom’s Resilience Amid Geopolitical Tensions: A Look at Uranium Supply Dynamics

    Kazatomprom’s Resilience Amid Geopolitical Tensions: A Look at Uranium Supply Dynamics

    Despite the geopolitical turbulence of 2023, the global demand for nuclear power, regarded as a stable and low-carbon energy source, has surged, according to Meirzhan Yussupov, CEO of Kazatomprom, Kazakhstan’s national atomic company. Yussupov highlighted Kazakhstan’s pivotal role, with the country contributing approximately 40% of the world’s uranium production annually, powering a significant portion of the world’s nuclear reactors.

    In light of ongoing global uncertainties and discussions about market bifurcation, Kazatomprom emphasizes its commitment to energy security. Positioned in an ESG-compliant and low-risk jurisdiction, the company asserts its capability to maintain its leadership as a reliable supplier of natural uranium, catering to utilities’ needs in diversifying their supply sources.

    Navigating through the constantly evolving sanctions landscape, Kazatomprom remains vigilant, continually assessing and monitoring sanctions risks. The company has devised an action plan to mitigate potential negative impacts, adjusting it as new risks emerge.

    Despite the geopolitical turmoil, Kazatomprom’s financial position remains robust. With the majority of revenues in US dollars and financing raised likewise, the company benefits from a natural hedging effect against currency risks.

    Regarding sanctions against Russian banks, Kazatomprom has refrained from engaging with sanctioned entities and redirected funds to unsanctioned banks. While maintaining services with Uranium Enrichment Center JSC in Russia, the company scrutinizes compliance with sanctions regimes, aiming to mitigate associated risks.

    Amid concerns about transportation disruptions due to sanctions, Kazatomprom ensures continuous monitoring of potential impacts. Leveraging the Trans-Caspian International Transport Route, the company mitigates risks associated with its primary uranium transportation route.

    Addressing proposed US legislation targeting Russian enriched uranium imports, Kazatomprom asserts its resilience, noting that its primary business focuses on natural uranium production, unaffected by the proposed ban.

    Despite market uncertainties stemming from geopolitical tensions, Kazatomprom reports strong financial performance in 2023. Consolidated revenue surged by 43% compared to 2022, reaching KZT1435 billion (USD3.19 billion), driven by factors such as increased spot market prices for U3O8 and additional sales volumes.

    Looking ahead to 2024, Kazatomprom maintains its production guidance, aiming for 21,000-22,500 tU (100% basis). While the company has secured necessary volumes of sulfuric acid, delays in construction works at new sites pose potential operating uncertainties for the year.