uranium resources, market conditions and prospects robert vance nuclear development division oecd...
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Uranium Resources, Market Conditions and
Prospects
Robert VanceNuclear Development DivisionOECD Nuclear Energy Agency
Uranium Resource Inventory
2007 to 2011: +30 % total identified resources
Overall trend-increased resource inventory and increased production costs
Total identified uranium resources are ~ 7.1 Mt U and have increased by 12.5 % since 2009, but costs of production have also increased
Identified Resources 2007, 2009, 2011
Cost CategoriesUSD
Ton
ne
s U
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Distribution of Identified ResourcesRecoverable at a cost of <USD130/kgU (<USD 50/lbU3O8)
13 countries represent approx. 96% of total world U resources
Resources geographically widespread
1. Australia2. Kazakhstan3. Russian Fed/Canada
Other Countries 4%
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Exploration and Development Expenditures
*Expected
22% increase in uranium exploration and mine development expenditures between 2008 and 2010
Over USD 2 Billion in 2010
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Uranium Production
• In 2010 total world uranium
production : 54 670 tonnes U
(~142 million tonnes U3O8)
• Representing 85% of demand for world nuclear reactors (2010)
• 2010 forecast 55,000 tU• 2009 actual 50,772 tU
Forecast for 2011: 57 000 tU but production figures suggest actual production was below forecast (54 610 tU) due to technical and other challenges
Global Uranium Production increased by 25% between 2008 and 2010
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World 2010 U Production by Method
ISL surpassed UG as the main production method in 2009;proportion of ISL in world totals are expected to continue to increase in 2011
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Projected Geographical Distribution of Growth in Production Capacity to 2021
2009 to 2021: 61 430 to 63 775 tonnes U
*Secretariat Estimate
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• Growth from 375 GWe (1/1/2011) to between 540 GWe and 746 GWe by 2035 (including policy changes in Belgium, Germany, Italy and Switzerland)
• Impact on annual U requirements - from 65 000 tU in 2011 to between 98 000 tU and 136 000 tU by 2035 • Significant growth in nuclear capacity and U demand anticipated in China
and India; South Korea and the Russian Federation to a lesser extent• As a result, uranium demand is expected to rise for the foreseeable future• Some flexibilities: e.g. uranium tails assays
-U requirements could be reduced by 9.5 % if tails assays at enrichment facilities are lowered from 0.3 % to 0.25 % U235
-Would require low cost, excess enrichment capacity as enrichment requirements would increase by 11 %
Red Book Projections of Nuclear Generating Capacity and U Demand to 2035 (as of 2011)
Despite the accident at the Fukushima Daiichi NPP nuclear generating capacity is expected to grow as there is a continued recognition that nuclear power produces competitively-priced, base-load electricity that is essentially free of greenhouse gases and enhances security of energy supply.
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Uranium Supply – Demand to 2035
Normally reported as of Jan 2011 but for this edition was adjusted to September 2011, incorporating changes in plans Post-Fukishima (e.g. Belgium, Germany, Italy, Switzerland - accelerated or changed plans for closures, construction). Uncertainties remain in China, Japan and elsewhere but commitment remains unchanged for India and others)
746 GWe (-5% from 2009)
540 GWe(+6% from 2009)
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
2022
2023
2024
2025
2026
2027
2028
2029
2030
2031
2032
2033
2034
2035
0
20 000
40 000
60 000
80 000
100 000
120 000
140 000
Existing and committed production (A-II) Planned + prospective production (B-II)Production World reactor requirements
tU/year
High
Low
Year
Reactor Re-quirements
Gap between Production (black bars) and Reactor Requirements (dashed line) filled by Secondary Supplies
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IAEA 2012: 740 GWe by 2030
IAEA 2012: 456 Gweby 2030
Conclusions (1)
• Post-Fukushima: Expected to see growth in the nuclear industry, commitment remains in many nations, but at a slower pace in others (re-evaluation)
• Over 7.1 million tU conventional identified resources – what is known today (not all mineable U on planet earth)
• Over 100 years supply at recent rates of consumption (63 875 tU, 2010)
• Resources geographically widespread, but Australia holds largest share and one deposit currently dominates (Olympic Dam)
• Demand for uranium is expected to continue to rise in the long term for the foreseeable future.
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Conclusions (2)
• Identified resources are sufficient to meet high case growth in nuclear generating capacity until 2035
-Less than half the resource base will be required• Secondary Supplies will likely continue to be needed (but,
information on supply and availability is incomplete/unknown)• Strong market conditions will be required to bring resources to
market– Considerable investment needed to develop required production
increases and to maintain/expand existing production facilities, despite continuing effects of financial crisis
– Supply prone to disruption until capacity increased and diversified – Strong safety and environmental record must be maintained,
communicated and re-evaluated
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Uranium Production Considerations
• No mine operates at full production capability over its lifetime
• Mines take as much as 10 years or more to progress from resource definition to production in most jurisdictions due to challenging and lengthy regulatory requirements and processes
• Infrastructure and labour issues in developing countries• Costs of production have increased, but market prices have
declined• Supply chain relatively thin, some key facilities aging• Geopolitical risks; resource nationalization
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Post Fukushima Uranium Market
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Source: Ux Consulting 23 Oct 2012
Fukushima Dai-ichi NPP accident
Uncertainties: Government policies (e.g. nuclear plans – China?- and impact on commercial inventories – Japan); government actions (e.g .US DOE inventory releases) Near-term utility requirements largely met; purchases in 2012 “discretionary”
2011 Red Book release
Post Fukushima Uranium Market
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Source: Ux Consulting 23 Oct 2012
Fukushima Dai-ichi NPP accident
Longer term view of spot price – deteriorating, but still well above pre 2003 levels
2011 Red Book release
Post Fukushima Uranium Market
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2011 Red Book – expected mine development includes
• Kintyre (Australia): 2 300 – 3 000 tU/yr by 2015 – DELAYED
• Olympic Dam (Australia): 1 500 tU/yr by 2021 – DELAYED
(production increase)
• Trekkopje (Namibia): 1 600 – 2 545 tU/yr by 2013 – DELAYED
• Imouraren (Niger): 5 000 tU/yr by 2014 – DELAYED
• Azelik (Niger): 700 tU/yr by 2010 ???
• JFUMC (Jordan): 2 000 tU/yr by 2020 ???
Mine development responding to the market signal; the market responding to market conditions dominated by uncertainty growth rates in nuclear generating capacity
MEHIUM Project Background
Despite this uncertainty, the capacity of the global nuclear fleet is expected to increase in coming years. Uranium mine production will need to increase to meet increased demand.
-Freshly mined uranium meets about 70 - 85% of demand -Secondary sources of previously mined uranium supply the balance, but secondary sources in decline
(Russia – US HEU downblend agreement ends in 2013)
Kazakhstan driving production increases in recent years, but such growth rates are not considered sustainable
Longstanding producing countries are finding it challenging to increase production, manly due to lower market prices, but also due to public concerns based on a poor understanding of modern mining practices.
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MEHIUM Project
Uranium mining practices have evolved considerably since the mid-20th century when most of the legacy sites were produced, yet public perception issues, often based on outdated knowledge, continue to hamper mine development
NEA project launched in 2011 in an effort to address the issue of public perception by providing facts on current U mining practices and separating these practices from those that created legacy issues
Managing Environmental and Health Impacts of Uranium Mining (MEHIUM)
Goal: Plain language document for stakeholders to assess mine development proposals (with references to detailed technical information supporting plain language messages). Factual, not promotional.
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Meetings September 2011 and 2012
• Agreed approach: Key Global Components of mine life cycle to be addressed in standard format supported by case studies that contrast old and new
• Key Components: • Waste Rock Management, • Tailings, • Groundwater (ISL), • Effluent Management, • Dust (radon), • Radiation protection (worker, public, non-human biota), • Worker Health and Safety, • Site Specific factors (EIA), • Public Consultation, • Material Handling (transport) and Emergency
Preparedness,
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Meetings September 2011 and 2012
• Key Components (cont’d): • Mine closure provisions (planning and funding)• Economic Impacts, Benefits• Regulation (high level, key components)• Environmental monitoring• Knowledge transfer and information needs
• Common Structure:• Current status, • Regulatory and societal expectations (risk
perceptions),• Historical trends (how the industry evolved to its
current state in managing the key component) ,• Ways in which current performance has been
achieved• Each section with case studies comparing old (when
legacies were created) and new, where possible
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Remaining inputs were to be submitted from Expert Group by end of October 2012. Publication in early 2013 with possible short summary suitable for distribution for use in public consultation meetings during mine development
Request to you: guidance on legacy sites that provide a clear contrast to modern practices (e.g. mine rock management: Poços de Caldas – McClean Lake)
Do not wish to restate remediation issues, processes, costs, etc but would like guidance to information on mining practices that created the problems
Schedule for Production
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