www.nukeminc.comcopyright by NUKEM IncKazakhstan-US Investment Forum 2011 Slide 1November 2011
Kazakhstan Uranium Marketing Opportunities
Jeffrey R. Faul, President and CEO, NUKEM, Inc
Kazakhstan-US Investment Forum, New York, November 2011
www.nukemgroup.comcopyright by NUKEM Inc.Kazakhstan-US Investment Forum, New York Slide 2November 2011
NUKEM At-A-Glance
•World’s largest nuclear fuel trader
•50 Years of global nuclear fuel supply
•Over 15 million pounds U3O8 annually
•Supply arrangements through 2022
•Marketing partner to Kazakhstan
uranium industry since 1992
•Important supply relationships with
Tenex (Russia) and NMMC (Uzbekistan)
www.nukemgroup.comcopyright by NUKEM Inc.Kazakhstan-US Investment Forum, New York Slide 3November 2011
Kazakhstan’s Uranium Production:
Up, Up and Up
2011
www.nukemgroup.comcopyright by NUKEM Inc.Kazakhstan-US Investment Forum, New York Slide 4November 2011
Global Uranium Production by Country, 2001 vs 2011
Sources: EIA for US and Euratom
Annual Report for EU
Canada 34%
Australia 21%
Niger 8%
Russia 7%
Namibia 6%
Kazakhstan 6%
Uzbekistan 5%
Others 13%
Global Produc on Shares 2001
Canada 16%
Australia 11%
Niger 8%
Russia 7%
Namibia 7%
Kazakhstan 36%
Uzbekistan 4%
Others 11%
Global Produc on Shares 2011 (est)
www.nukemgroup.comcopyright by NUKEM Inc.Kazakhstan-US Investment Forum, New York Slide 5November 2011
Major Market Opportunities
Where are the largest markets for Kazakhstan’s uranium?
• Far East?
• Europe?
• USA?
www.nukemgroup.comcopyright by NUKEM Inc.Kazakhstan-US Investment Forum, New York Slide 6November 2011
Chinese Puzzle: How Much Will They Buy Now?
0
2000
4000
6000
8000
10000
12000
14000
16000
18000
2011 2012 2013 2014 2015 2016 2016 2018 2019 2020
Mert
ic T
on
nes
Ura
niu
m
China's Rising Reactor Needs
Source: WNA 2011
www.nukemgroup.comcopyright by NUKEM Inc.Kazakhstan-US Investment Forum, New York Slide 7November 2011
China Supply and Demand
Basic and Future Supplies – Best Estimate
0
2,000
4,000
6,000
8,000
10,000
12,000
14,000
16,000
18,000
20,000
2011 2013 2015 2017 2019
Year
AREVA NP
Areva NC
Paladin
KazAtomProm
Cameco
Current Basic Supply
Demand
Upper Case
Ref Case
Lower Case
t U
Sources:
Demand: WNA 2011
Supply: NUKEM 2011 & Other Sources
www.nukeminc.comcopyright by NUKEM IncKazakhstan-US Investment Forum Nov 2011 Slide 8November 2011
Kazakhstan Already Dominant in China
49% of Semizbai JV held by CGNPC (China Guongdong Nuc. Pwr.
Corp.)
49% of Zhalpak JV held by CNNC (China National Nuclear Corp.)
Combined production when in full production: 2,250 tU/per year
Chinese “equity share”: Approx 1,100 tU per year, but all sold to
China
Term contract for 24,200 tU signed with CGNPC 2008-2020
Approx. 2,400 tU per year to 2020
Cameco and AREVA both have major long-term contracts with China,
(each about 2,000 tU per year) and both have major production
ramping up in Kazakhstan
www.nukeminc.comcopyright by NUKEM IncKazakhstan-US Investment Forum Nov 2011 Slide 9November 2011
Where to from Here?
Japan well-supplied post-Fukushima
Kazakhstan already active in India, and even in 2020, Indian
demand will be only 25% the size of China’s
Only large markets left are EU and USA
www.nukeminc.comcopyright by NUKEM IncKazakhstan-US Investment Forum Nov 2011 Slide 10November 2011
Kazakhstan’s Share in Two Largest Uranium Markets
Australia
15%
Canada
21%
Russia
22%
USA
8%
Kazakhstan
15%
Nambia
11%
Others
8%Australia
12%Canada
12%
Russia
28%Niger
12%
Kazakhstan
16%
S.A.+Namibia
7%
Others
13%
Top Supplier Countries
to U.S. Utilities (2010)
Top Supplier Countries
to EU Utilities (2010)
Sources:
DOE EIA Uranium Marketing Annual 2010 (US); Euratom
Annual Report 2010 (EU)
www.nukeminc.comcopyright by NUKEM IncKazakhstan-US Investment Forum Nov 2011 Slide 11November 2011
Uncovered Uranium Requirements in Two Largest Markets
0
5000
10000
15000
20000
25000
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
Me
tric
To
nn
es
Ura
niu
m
Uncovered EU Needs
Uncovered US Needs
Sources:
UX Consulting (US) and NAC (EU)
www.nukeminc.comcopyright by NUKEM IncKazakhstan-US Investment Forum Nov 2011 Slide 12November 2011
Conclusions
• There’s a big difference between “reactor demand” and
“uncovered reactor demand”
• The fast-growing China market is already well-supplied, and
Kazakhstan (directly or indirectly) is already the dominant supplier
• Further Chinese purchases are simply adding to strategic
inventory
• While the EU has some unmet requirements, mostly post-2015,
they are substantially smaller than unmet US requirements
• Given Kazakhstan’s 35% share of global production, and 15%
market share in the US, the US must be seen as Kazakhstan’s
best opportunity for future uranium sales