Russia, Kazakhstan Sign $1Bln Uranium Supply Contract

Russian uranium export monopoly Tekhsnabexport and the Russian-Kazakh-Kyrgyz uranium mining venture Zarechnoye signed a contract on Thursday, June 22, which presupposes supplies of $1 billion worth of uranium between now and 2022. This information was reported by the Interfax agency, which quoted a source in the Russian company.

Zarechnoye, which mines the Zarechnoye uranium field in Kazakhstan, is planning to produce the first batch of uranium in the third quarter of 2006. Under the contract, the first shipment of uranium will be dispatched to Russia in January 2007.

This is Russia?s first contract for the import of uranium and Zarechnoye is Russia?s first joint uranium mining venture on the territory of a foreign state.

The contract has been signed under the Russian and Kazakhstan joint program on peaceful use of nuclear power, which provides for the development of the Zarechnoye JV and for setting up a number of uranium production ventures with Russian interests in Kazakhstan.

It is expected that uranium production and Kazakhstan?s uranium supply to Russia will increase by up to 6,000 tons a year.
Zarechnoye JV design capacity totals 1,000 tons of uranium a year, which will be hit in 2009. Estimated deposited resources at the field operator Zarechnoye JV totals 19,000 tons of uranium.

The key owners are Tekhsnabexport and Kazatomprom, which hold 49.3 percent each. In addition, the Russian-based Atompredemtzoloto and Kyrgyz Kara-Baltin each hold 0.7 percent. The total investment of all participants into the joint venture development totals $60 million.

The wholly state-owned Tekhsnabexport is Russia?s main exporter of nuclear industry products and services and controls an estimated 40 percent share of the global market for these products and services.