By Hilary Mare
NAMIBIA is positioned as one of the frontrunners to benefit from the surge in uranium demand growth, which is expected later this year.
This is against the backdrop of investments in new nuclear reactors in Russia, China, South Korea and Japan, with Namibia’s Husab Mine seen as a possible supplier.
Insight solutions provider, GlobalData, was quoted by Fin24 last week, saying that the upsurge in demand will benefit emerging uranium mines, including those in Namibia.
“…22 new nuclear reactors, which will require triuranium octoxide or yellowcake, are scheduled for completion this year, with a total capacity of 22 444MW. Eight of these reactors are located in China, four in Japan, two in South Korea and two in Russia,” GlobalData Mining Research Director, Alok Shukla, said.
Subsequently, global uranium mine production is projected to increase by 4.8 percent in 2017, to 67 686.1 tonnes, with uranium production in Namibia expected to triple this year, with the ramping up of the massive Husab Mine, according to Finance Minister Calle Schlettwein.
“We are of the opinion that, in spite of weak commodity prices and relatively slow growth in external demand, the coming into operation of large-scale mining projects will support decent levels of economic growth. Namibia’s output of uranium in 2017, for example, is projected to be more than three times the volume produced in 2015, thanks in large part to the Husab uranium mine,” he said.
Figures forecasted by the mine also show that uranium oxide production is set to expand from 3 713 metric tons in 2013, to around 11 000mt in 2017. This makes Namibia the fifth largest uranium producer in the world, behind Kazakhstan, Canada, Australia and Niger.
Shukla noted that the uranium mining industry currently faces abundant supply and high inventories at utilities in Japan, the US and Europe, which has put downward pressure on prices.
Uranium spot prices fell in 2016, averaging US$27.7/lb in June – down by 15 percent from March and 24.7 percent from June 2015.
Prices dropped by nearly 30 percent by the end of last year.
However, there is now good news on the horizon.
“Global uranium mine production is increasing to meet rising demand that is likely to follow, as reactors come on stream. Such production was estimated at 64 574 tons in 2016 – up by 6.7 percent from 2015 – as a result of production increases of 41 percent in Namibia, 10.3 percent in Canada and 6.8 percent in Australia,” Shukla said.
New projects scheduled to start commercial operations in 2017, apart from the Husab Mine, include uranium producer Khiagda’s Istochnoye mine, in Russia, which reported uranium reserves of 1 864 tons at the end of 2016, and fully integrated uranium and vanadium producer Energy Fuels’ Canyon Mine, in the United States.
The US$2 billion Husab project in the Namib Desert could potentially produce 15 million pounds of U3O8 annually, thus overtaking Niger and Australia’s production outputs, Bloomberg reported.
It is reportedly the third largest uranium-only deposit in the world, with measured and indicated reserves of about 140 000 tons. The open-pit mine, which consists of two pits, is expected to have 20-year lifespan.
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