MINEX Forum

Tag: Kazatomprom

  • Kazatomprom and Cameco launch new project in Kazakhstan

    Kazatomprom and Cameco launch new project in Kazakhstan

    Inkai, a joint venture by Kazatomprom (60%) and Canadian Cameco (40%), has announced its plan to build an affinage facility with a capacity of 4,000 tons of uranium per year.

    «This project is going to boost the output at the Inkai uranium mine by 4,000 tons of triuranium octoxide. Under the project, the construction of a new affinage facility, a power substation with a diesel generator and the reconstruction of the existing pregnant solution processing plant are expected. The project starts this year and will be over in 2025,» the joint venture said in a statement on public hearings scheduled for April 2.

    The company plans to build all these new facilities in parallel with uranium production and processing. Once they are ready, these facilities will be integrated into the current utility systems and the power grid. Inkai is going to use artesian water for its production processes and bring drinking water for workers in bottles. Even though the company hasn’t revealed any financial details, the project will be completed within the next 18 months.

    The project is expected to be implemented within the existing mine that occupies 240.79 square kilometers and is located 10 kilometers away from the Taykonyr village of the Sozak District in the Turkestan region of Kazakhstan. The affinage facility will be in operation until 2045 when the Inkai mine expires. The affinage facility will be equipped with advanced equipment from Cameco. The facility is expected to produce 4,000 tons of uranium if it works 311 days per year or 7,450 hours.

    To produce uranium at the Inkai mine, the joint venture relies on in-situ leaching that involves leaving the ore where it is in the ground and recovering the minerals from it by dissolving them and pumping the pregnant solution to the surface where the minerals can be recovered. Consequently, there is little surface disturbance and no tailings or waste rock generated. After extracting and refining the uranium, the company produces yellowcake, a type of uranium concentrate powder obtained from leach solutions.

    As of January 1, 2023, there were 127,000 tons of uranium in the mine’s ore reserves (the total amount of mineral resources including reserves of 148,000 tons of uranium), according to the company.

    Overall, Inkai consists of four sites. Site #1 is the processing plant; sites #2 and #3 are production facilities and site #4 is a camp for 745 workers.

    According to Cameco, the Inkai mine produced 3,192 tons of uranium last year as the company faced some difficulties linked with reagent supply and well drilling.

    In January 2024, Kazatomptom, which is one of the leaders in the global uranium market, said that it could lower its production plant for 2024 due to a lack of sulfuric acid, a key component for in-situ leaching, in open markets. At the same time, the company reassured its customers that it would deliver its current arrangements. As of yearend 2023, Kazatomprom reported $3.1 billion in revenue (+43%) compared to just a 20% increase in the uranium price.

  • Kazatomprom Forecasts Uranium Supply Deficit Amid Growing Global Demand

    Kazatomprom Forecasts Uranium Supply Deficit Amid Growing Global Demand

    During the “ATOMEXPO-2024” forum, Meirzhan Yusupov, Chairman of the Management Board and Member of the Board of Directors of the National Atomic Company “Kazatomprom” stated that with the increasing demand for nuclear energy worldwide, new players are expected to enter the uranium supply market, as Kazakhstan alone may not be sufficient to meet global needs. While currently, global uranium reserves are estimated at 4.7 million tons, capable of meeting the growing demands for nuclear generation in the coming decades, Yusupov noted a potential future deficit due to escalating generation needs. Despite significant geological exploration efforts, he emphasized the likelihood of a structural deficit post-2030, indicating the insufficiency of Kazatomprom alone to bridge this gap. Yusupov anticipated the emergence of new players in uranium mining, with some junior companies already actively engaged in this sector. He reassured that Kazatomprom, as a global leader, remains committed to fulfilling its contractual obligations in uranium supply.

  • Kazatomprom, the National Atomic Company of Kazakhstan, disclosed its consolidated financial outcomes for the year 2023

    Kazatomprom, the National Atomic Company of Kazakhstan, disclosed its consolidated financial outcomes for the year 2023

    Kazatomprom’s 2023 financial results reflect the significant improvement in the uranium market and the company’s strong position as the largest seller and lowest-cost producer globally.

    Kazatomprom demonstrated exceptional financial resilience, reflecting its strategic market positioning and robust operational efficiency. Despite significant volatility in the global uranium market due to geopolitical tensions and clean energy transition, the demand for nuclear power increased significantly. With Kazakhstan accounting for 40% of annual world uranium production, at least every third of nuclear reactors worldwide relies on Kazakh uranium. Meirzhan Yussupov, CEO of Kazatomprom, emphasized the Company’s role in energy security and readiness to secure utilities’ needs amidst market bifurcation discussions.

    Kazatomprom achieved impressive financial results in 2023, despite a modest increase in average annual uranium prices. Group consolidated revenue grew by 43%, reaching 1.4 trillion tenge, while gross and operating profits demonstrated almost 50% year-on-year increases. These achievements were made possible by the considerable improvement in the uranium market over the past year and Kazatomprom’s position as the largest seller and lowest-cost producer globally. The efforts of the Company’s 20,000 dedicated professionals contributed significantly to these positive outcomes.

    In 2023, Kazatomprom launched exploration programs and strengthened assessments of territories to ensure reserve replenishment for future generations and meet growing market needs. The Company continues to focus on cost optimization to maintain operational efficiency and sustainability. Despite plans to restart idled capacity and launch new production in the mid-2020s, Kazatomprom acknowledges that another supply source similar in size will be needed post-2030 to cover future market needs, especially considering geopolitical uncertainties, inflationary pressures, and supply chain challenges worldwide.

    Key financial metrics for 2023 include:

    • Consolidated revenue: KZT 1,435 billion (USD 3.1 billion), a 43% increase compared to 2022
    • Operating profit: KZT 681 billion (USD 1.5 billion), a 49% increase compared to 2022
    • Net profit: KZT 580 billion (USD 1.3 billion), a 23% increase compared to 2022
    • Adjusted EBITDA: KZT 829 billion (USD 1.8 billion), a 31% increase compared to 2022
    • Attributable EBITDA: KZT 639 billion (USD 1.4 billion), a 29% increase compared to 2022
    • Cash flow from operating activities: KZT 432 billion (USD 960 million), a 52% increase compared to 2022

    The Operating and Financial Review and Audited Consolidated Financial Statements provide detailed explanations of Kazatomprom’s results for the year ended 31 December 2023, as compared to the same period in 2022, and the Company’s guidance for 2024. These documents are available at www.kazatomprom.kz.

  • Analysts View Kazatomprom’s Financial Report Positively Despite Uranium Sales Dip

    Analysts View Kazatomprom’s Financial Report Positively Despite Uranium Sales Dip

    Financial analysts from Freedom Broker and Halyk Finance have lauded the financial report of the uranium company “Kazatomprom,” particularly noting a positive growth trajectory in revenue. According to Freedom Broker’s assessment, while an increase in production costs and a decrease in uranium sales are anticipated, they recommend purchasing Kazatomprom’s shares, anticipating the company’s ability to rebound to its target metrics. Similarly, Halyk Finance acknowledges that Kazatomprom hasn’t fully capitalized on the surging uranium prices, yet they advise investors to buy the company’s stocks based on the record-breaking financial results, as reported by broker reviews.

    Freedom Broker highlights potential production challenges due to sulfuric acid procurement issues, projecting them to be temporary and affirming Kazatomprom’s capability to regain previous production and sales targets. Additionally, experts underscore the company’s record revenue of 1.43 trillion tenge, marking a 43% year-on-year increase, driven by a 39% surge in natural uranium sales in 2023 and the initiation of enriched uranium sales, yielding 91 billion tenge in revenue.

    Despite a marginal 2% decline in uranium production in 2023, Kazatomprom managed to sell 10% more uranium compared to 2022, amidst a 22% increase in the average uranium selling price. While operational profitability surged by 49%, net profits grew by 23%, with the company’s assets expanding to 2.59 trillion tenge by the end of 2023.

    Looking forward, analysts foresee a potential 27% increase in Kazatomprom’s stock value, reaching 23.3 thousand tenge, alongside an estimated dividend of at least 1,188 tenge per share for 2023. Halyk Finance maintains its target price at 22.8 thousand tenge, emphasizing the company’s potential to capitalize on uranium sales amid high market prices.

  • Kazatomprom Claims Top Spot Among Global Uranium Producers

    Kazatomprom Claims Top Spot Among Global Uranium Producers

    Kazatomprom National Atomic Company has secured its position as the leading global uranium producer, as reported by Insider Monkey, a financial website renowned for its expertise in insider trading and hedge fund data, on February 23.

    Serving as Kazakhstan’s premier operator for uranium export and import, nuclear power plant fuel, and associated technologies, Kazatomprom contributes a remarkable 23% to the global uranium supply, solidifying its status as the largest producer and distributor of natural uranium on a worldwide scale.

    In the year 2022 alone, Kazatomprom achieved an impressive production output of 11,373 tons of uranium, showcasing its significant contribution to the global uranium market.

    Data from the Samruk Kazyna Sovereign Wealth Fund reveals that Kazakhstan emerged as a dominant force in uranium mining during the same year, accounting for a substantial 42% of global production, with Kazatomprom alone representing 22% of this share.

    Furthermore, according to the European Atomic Energy Community (Euroatom), Kazakhstan played a pivotal role in 2022, contributing to 26.82% of the European Union’s uranium imports, underscoring its significance as a key player in the European uranium market.

    Insider Monkey, renowned for its reputable financial news and investment insights, provides comprehensive analysis, data-driven articles, and market updates to empower investors of all levels. With a focus on topics such as stock market trends, investment strategies, and financial news, Insider Monkey equips individuals with the knowledge needed to make informed investment decisions through its extensive coverage and thorough research.

  • Kazatomprom held the 26th Corporate HSE Meeting

    Kazatomprom held the 26th Corporate HSE Meeting

    The meeting organised on 16 February focused on the achievements in the field of industrial safety in 2023 and the tasks for 2024. Kazatomprom is the first national company in Kazakhstan to join the Vision Zero international program, which aims to achieve zero injuries at work. The company is constantly improving the safety culture of its employees, guided by the principle of transparency in all aspects of HSE. Environmental responsibility remains a key aspect of Kazatomprom’s activities. The company strives to not only comply with international environmental standards, but also to be a leader in the application of best practices and innovative approaches aimed at continuous reduction of environmental impact.

    In 2023, all targets for industrial safety were met, and there were improvements in some indicators in terms of ecology and road safety. The company will continue to develop a culture of safety and environmental responsibility and intends to improve its activities in the field of industrial safety, including the use of IT technologies and a risk-oriented approach to planning and organizing work. Ensuring a high degree of involvement of both production personnel and managers of all levels in HSE issues is the most important factor for improving the corporate safety culture. During the event, an award ceremony was held for employees and enterprises of the nuclear holding company for their achievements in the field of HSE.

    Key points:

    • Vision Zero: Kazatomprom is committed to achieving zero injuries at work.
    • Safety culture: The company is constantly improving its safety culture, guided by the principle of transparency.
    • Environmental responsibility: Kazatomprom is committed to environmental responsibility and strives to be a leader in the application of best practices and innovative approaches aimed at continuous reduction of environmental impact.
    • HSE performance: In 2023, all targets for industrial safety were met, and there were improvements in some indicators in terms of ecology and road safety.
    • Future plans: The company will continue to develop a culture of safety and environmental responsibility and intends to improve its activities in the field of industrial safety.

     

  • Kazatomprom Achieves ‘B’ Climate Rating from CDP Amidst Global Push for Sustainability

    Kazatomprom Achieves ‘B’ Climate Rating from CDP Amidst Global Push for Sustainability

    On February 8, Kazatomprom announced that it had been assigned a ‘B’ climate rating in the ‘Climate Change’ category by the international Carbon Disclosure Project (CDP), which tracks greenhouse gas emissions data disclosure. This article explains what this rating means, why it is important, and what climate ratings other Kazakhstani companies have received.

    Kazatomprom participated in the CDP project for the first time and voluntarily disclosed its environmental data for 2022, including greenhouse gas emissions. The ‘B’ rating it received is above the average market ratings of ‘C’ for the Asia region and ‘B-‘ for the ‘Metals Processing’ sector. Other companies such as QazaqGaz, KAZ Minerals, KazMunayGas, Samruk-Energo also shared their 2022 environmental data with CDP and received climate ratings.

    The CDP sends questionnaires to major companies worldwide and assigns ratings from ‘F’ to ‘A’ across four categories: ‘Climate Change,’ ‘Water Security,’ ‘Forests,’ and ‘Plastic Use.’ Disclosure of such information is voluntary, as it is not mandated by regulation.

    Companies that do not respond to the CDP’s request are given an ‘F’ rating. For example, Freedom Holding and Tengizchevroil received this rating, but CDP clarifies that it indicates a lack of response from the company, not necessarily issues with sustainable development.

    Among Kazakhstani companies, Kazatomprom has the highest rating of ‘B’ in the ‘Climate Change’ category. KazMunayGas received ‘C’ ratings in three categories (‘Climate Change,’ ‘Water Security,’ and ‘Forests’), and KAZ Minerals received ‘C’ ratings in ‘Climate Change’ and ‘Water Security.’

    The CDP considers multiple factors when assessing a company, so the amount of carbon dioxide emissions does not directly correlate with the assigned rating. For the reporting year 2022, the most polluting Kazakhstani companies that received ratings were Samruk-Energo, KazMunayGas, and QazaqGaz, with direct carbon dioxide emissions of 33 million, 8.1 million, and 5.1 million metric tons, respectively. Although QazaqGaz had fewer emissions than KMG, it received a worse climate rating (‘C’ for KMG, ‘D’ for QazaqGaz). KAZ Minerals emitted 580,000 metric tons, and Kazatomprom emitted 97,000 metric tons of carbon dioxide, according to their CDP questionnaires.

    Kazatomprom stated that after receiving a CDP rating, the company is sent a brief confidential report, which includes information about the average ratings of peer companies in the industry and region. These average market values are not accessible to regular registered users on the CDP website.

    CDP believes that the ratings also help companies track their progress towards sustainability, as success cannot be determined without a measure.

    The CDP questionnaire is aligned with the recommendations of the Task Force on Climate-related Financial Disclosures (TCFD) and is used by companies on a voluntary basis. Other sustainability initiatives like the Global Reporting Initiative (GRI), Climate Disclosure Standards Board (CDSB), and Sustainability Accounting Standards Board (SASB) also follow TCFD recommendations but provide their separate ESG disclosure standards.

    This results in investors being unable to compare seemingly identical metrics among companies using different standards. CDP serves as a unified platform where such information is collected and structured.

    “CDP was created to standardize and centralize greenhouse gas emissions reporting so that we can keep a global account. This data is crucial for coordinating climate change mitigation efforts and increasing their effectiveness. For the organization itself (the surveyed company), it is an opportunity to confirm its achievements and show that it is ready to contribute to solving one of the main global problems,” comments Vasily Kalabin, an expert in sustainable development and ESG.

    The CDP website allows full access to companies’ responses to the CDP questions and direct analysis of the emissions data. The questionnaire also provides access to verifying documents from regulators and third-party organizations about each company’s greenhouse gas emissions (in Kazakhstan, verification is performed by Eurasian GHG Management in Shchuchinsk).

    Vasily Kalabin notes that CDP is not very popular among Kazakhstani companies. He explains that there are rating organizations that provide a comprehensive ESG assessment, which is often more in demand than CDP. These include Sustainalytics, MSCI, and S&P Global ESG Score, among others. Such ratings are highly sought after by investors, which is why many companies in Kazakhstan and abroad seek to obtain them today.

    Kalabin points out that foreign investors and regulators are the main drivers of the sustainable development agenda, and that Kazakhstani companies listed on foreign stock exchanges, such as Kaspi.kz, Halyk Bank, KazMunayGas, and Kazatomprom, have these ratings.

    Subsidiaries of the National Welfare Fund “Samruk-Kazyna” also receive such ratings by the fund’s mandate. As an example, Kalabin mentions QazaqGaz, which was rated by Sustainalytics at 19.2 points last December, indicating low risks. There is no data for Air Astana, which recently conducted an IPO, including on the London Stock Exchange, in either Sustainalytics or CDP systems.

    Kazatomprom commented that “the practice of disclosing information through CDP is welcomed in the global markets for the company’s products.” Therefore, the national atomic company plans to mention its ‘B’ CDP rating in its public materials “to enhance its investment attractiveness and stakeholder engagement.”

  • The production cuts by Kazatomprom have led to a surge in uranium prices

    The production cuts by Kazatomprom have led to a surge in uranium prices

    The uranium market is witnessing a significant shift due to recent developments in production cuts by the world’s top uranium producer, Kazatomprom, and the increasing demand for nuclear power across various nations. These changes are creating a favourable environment for uranium project developers, who are now seeing a stronger outlook for prices and supply agreements.

    Kazatomprom’s Production Cuts

    Kazatomprom, the state-run miner from Kazakhstan, announced a reduction in its 2024 production guidance by up to 14%, signalling a potential shortfall in production targets into 2025. This decision is attributed to difficulties in procuring sufficient levels of sulfuric acid, a key ingredient in the company’s in-situ uranium mining process, and delays in completing construction works at newly developed uranium deposits. The company has been producing only 80% of its permitted maximum uranium output since 2018, a self-imposed limit due to the previously depressed state of the uranium market.

    Impact on Uranium Market and Project Developers

    The production cut by Kazatomprom has led to a surge in uranium prices, with spot prices more than doubling from around $48 per pound at the end of 2022 to $100 per pound by the end of January 2024. This has resulted in increased optimism among uranium project developers, such as Bannerman Energy Ltd. and Deep Yellow Ltd., who are working on projects in Namibia and Australia, respectively. Bannerman Energy’s CEO, Brandon Munro, highlighted the growing interest from utilities in diversifying their supply sources, a trend that is expected to continue. John Borshoff, CEO of Deep Yellow, also expressed a positive outlook, anticipating a sustainable period of high prices for at least a decade.

    Demand for Nuclear Power

    The demand for uranium is further bolstered by the revival and expansion of nuclear power fleets in countries such as China, Japan, South Korea, and France. This resurgence in nuclear power is driven by the global push for decarbonization and the need for reliable, low-emission energy sources to meet climate goals.

  • The president of Kazakhstan met Meirzhan Yusupov the Chairman of the Board of NAC Kazatomprom

    The president of Kazakhstan met Meirzhan Yusupov the Chairman of the Board of NAC Kazatomprom

    Kassym-Jomart Tokayev heard a report on the results of Kazatomprom’s activities for 2023, as well as on the company’s goals and plans in the short and medium term.

    The President was informed that at the end of last year, the production and sales of uranium products amounted to more than 21 and 18 thousand tons, respectively. As Meirzhan Yusupov reported, the share of transportation of uranium products along the Trans-Caspian International Transport Route in 2023 has increased significantly. 64% of all uranium shipments from Kazakhstan to Western countries were transported along this transit corridor.

    In addition, the Head of State was informed about the ongoing investment projects of the Kazatomprom group of companies, as well as socially significant projects aimed at developing and supporting the regions of presence.

    The President was also informed about the work to expand and replenish the mineral resource base.

    Following the meeting, the Head of State gave a number of specific instructions to improve the efficiency of Kazatomprom.

  • Kazakhstan’s New Sulfuric Acid Plant Boosts Uranium Production and Economic Growth

    Kazakhstan’s New Sulfuric Acid Plant Boosts Uranium Production and Economic Growth

    Kazakhstan’s Samruk Kazyna Sovereign Wealth Fund and Balestra signed on 19 January 2024 an agreement to construct a sulfuric acid plant in the Suzak district of the Turkistan Region.

    This plant, designed to produce 800,000 tons of sulfuric acid annually, will supply Kazatomprom, the national uranium company. Samruk-Kazyna, a sovereign wealth fund, was established to enhance the competitiveness and sustainability of the national economy. It manages shares of national development companies and other legal entities to maximize their long-term value and competitiveness. Kazatomprom, on the other hand, is the national operator for the import and export of uranium, rare metals, and nuclear fuel for nuclear power plants.

    The construction of the sulfuric acid plant is set to commence in 2024, with full operational capacity expected by 2026. This project will significantly contribute to the economic and social development of the Turkistan region, attracting additional investments and generating local tax revenues. It is estimated to create about 800 jobs during construction and will require about 500 workers for its operation. The plant is of strategic importance to Kazatomprom, the world’s largest uranium producer, as sulfuric acid is the main reagent used in its in-situ leach uranium operations. This is particularly crucial as Kazatomprom has recently warned of potential production shortfalls due to sulfuric acid shortages.