JOHANNESBURG (miningweekly.com) – World energy demand is growing. The International Energy Agency predicts that global energy requirements will increase by 40% by 2030. No less than 80% of this increase in demand will come from emerging and developing countries.
Fossil fuel resources, although not close to exhaustion yet, are clearly limited. In many countries, sites suitable for hydroelectric power are already being exploited, and there are many other countries for which hydroelectricity is not an option at all. On top of all this, climate change remains a widespread concern.
The only credible alternative noncarbon- producing source of baseload electricity is nuclear energy. This, obviously, is good news for the uranium-mining sector. However, the demand for uranium for fuel for nuclear power plants (NPPs) should not be expected to increase dramatically in the short term. Rather, it is more probable that the increase in demand will start slowly but accelerate over time.
The Nuclear Energy Agency (NEA) of the Organisation for Economic Cooperation and Development has examined the likely future development of nuclear energy worldwide, between now and, initially, 2030, and, latterly, 2050. In each case, the NEA – which must not be confused with the International Atomic Energy Agency (IAEA) – has calculated two scenarios, a lower and a higher.
“By 2030, there will not be a very significant change in the number of NPPs in the world,” NEA director-general Luís Echavarri told the International Conference on Access to Civil Nuclear Energy in Paris last month.
“We see a bigger change by 2050. In the lower scenario, by 2050 we’ll go from the 430-plus units in operation today to 600. In the higher scenario, we will go to 1 400.”
He pointed out that many countries will first have to rebuild their nuclear manufacturing capability before they can build new NPPs.
Across the world, the politics of civil nuclear energy has substantially changed in recent years. There is now strong and explicit support from major powers for the use of nuclear energy by all countries that adhere to the regulations and requirements of the IAEA and the nuclear Non-Proliferation Treaty.
“Achieving energy balance in the future will require nuclear energy to be successfully implemented in new countries,” assert- ed French President Nicholas Sarkozy in his keynote address at the Paris conference. “Otherwise, we will face all of the conse- quences, including rapid depletion of fossil fuel resources, faster global warming and increasing social and political turmoil.
“The world must not be divided between countries with nuclear energy technology and those without,” he affirmed. “On the contrary, I think that nuclear energy can be the cement that binds a new form of global solidarity. It is in our common interest to work together to organise our interdependence. And I really mean working together, because, from mining fuel to managing waste, and in every other phase of the fuel cycle, each of us will need the others.”
France is a world leader in the use of civil nuclear power and obtains nearly 80% of its electricity from 58 nuclear reactors. The country is also committed to the third- generation European Pressurised Water Reactor (EPR). “France’s lead does not confer any special privileges. But it does give our country a duty to share its experience with all countries wishing to start or resume civil nuclear energy programmes,” assured Sarkozy. “This is our political will. This is our mission. We want to share our expertise. We feel it is our duty to share our competences and expertise with other countries.”
The number of foreign students studying civil nuclear energy and technology in France has increased by three times since 2007. The country’s international master’s degree programme now includes students from Algeria, Argentina, China, India, Jordan, Poland, Tunisia, the United Arab Emirates and Vietnam. But Sarkozy wants France to do more. “I have decided to step up our efforts by creating an International Nuclear Energy Institute that will include an International Energy School. It will bring together the best teachers and researchers to provide very high quality education alongside the most modern plants and research centres at Saclay, where we will have the largest campus in Europe, and at Cadarache.” As part of this programme to spread French expertise, the country is setting up specialised centres of excellence in other countries.
And the US is also in favour of the respons-ible use of nuclear energy. “We support the adoption of [civil] nuclear energy by countries who are living up to their nonproliferation obligations,” US Deputy Secretary of Energy Daniel B Poneman told journalists just after the conclusion of the Paris Conference. “The US position is that nuclear energy represents a significant source of carbon-free electricity.
“I think we’ve arrived at a unique moment in our history,” he affirmed. “We have an opportunity here to address climate change.” This created a unique opportunity to bring nuclear power to a large number of countries, but this also carried with it a great respons-ibility – to do this safely and to prevent the proliferation of nuclear weapons.
Currently, the US has 104 operating nuclear power plants, generating 20% of the country’s electricity. However, significantly, these nuclear plants account for no less than 70% of America’s greenhouse-gas-free generation. The US Department of Energy is currently doing research and development work on safely extending the life of America’s current nuclear power plants from the originally planned 60 years to as long as 80 years.
Earlier this year, the US government issued loan guarantees worth more than $8-billion to support the construction of two new nuclear power plants in the country – the first in about a quarter of a century. “They will be completed in 2017 and 2018,” reported Poneman.
“Quite a number” of more NPP projects are now seeking licensing in the US. “We have a loan guarantee authority of $18,5-billion; these first two nuclear plants took just over $8-billion, so we have the loan authority for at least another two,” he summed up. “President [Barack] Obama has asked Congress to increase the amount available for loan guarantees, so we should have enough loan guarantees for six to nine new nuclear power plants.”
In Europe, in general, the public and political mood is swinging back in favour of nuclear as well. “All over Europe, countries which voted to phase out nuclear, after Chernobyl, have reversed these decisions,” pointed out GDF-Suez Nuclear Communications Services Centre manager Laurent Furedi in a briefing to journalists at the company’s Paris head office last month. “The only exception is Germany, but it is now under debate there.” For example, the Belgian federal government has decided to extend the operation of the country’s three newest NPPs by ten years, instead of phasing them out. (GDF-Suez is a Paris Bourse-listed energy group which operates seven reactors in Belgium, two in France and one in Germany; nuclear accounts for 16% of the group’s total installed generating capacity of 73 000 MW.)
According to the World Nuclear Association (WNA), there are some 436 nuclear power reactors in operation in 31 countries (including Taiwan), with another 50 or so under construction in 13 countries. The 436 operational reactors will need 68 646 t of uranium to supply their fuel requirements for this year. In 2008, total global uranium production from mines was 43 853 t, equivalent to 67% of the demand for power generation. (In 2007, 36% of the uranium required for nuclear fuel came from secondary sources.)
This mine production came from 18 countries. From the largest to the smallest producers, these were Canada, Kazakhstan, Australia, Namibia, Russia, Niger, Uzbeki-stan, the US, Ukraine, China, South Africa, Brazil, India, the Czech Republic, Romania, Germany, Pakistan and France. But just three of these countries accounted for 59% of global mine production, namely Canada (20,5% of the total), Kazakhstan (19,4%) and Australia (19,2%).
In terms of companies, in 2008, ten were responsible for marketing 87% of global uranium production from mines. These were Rio Tinto, which produced 7 975 t of uranium, or 18% of the total, Cameco (6 659 t, 15%), Areva (6 318 t, 14%), KazAtomProm (5 328 t, 12%), ARMZ (3 688 t, 8%), BHP Billiton (3 344 t, also 8%), Navoi (2 338 t, 5%), Uranium One (1 107 t, 3%), Paladin (917 t, 2%) and GA/Heathgate (636 t, 1%), while ‘others’ contri-buted 5 543 t, or 13% of global production.
Cameco’s McArthur River mine, in Canada, was, in 2008, the biggest single uranium mine in the world, with an output of 6 383 t of uranium, or 15% of world mine production. The Ranger mine, in Australia, owned 68% by Rio Tinto, came second at 4 527 t, or 10%, with Namibia’s Rössing (69%-owned by Rio Tinto) third at 3 449 t, or 8%, followed closely by BHP Billiton’s Olympic Dam mine, in Australia, at 3 344 t, or also about 8%.
The WNA forecasts world uranium demand at 74 000 t by 2015, and states that most of this will have to come directly from mines. In 2007, the world’s known recoverable (‘reasonably assured and inferred’) resources of uranium (assuming a uranium price of $130/kg) amounted to 5 469 000 t. Of this total, 1 243 000 t was in Australia (23% of the total), 817 000 t in Kazakhstan (15%), 546 000 t in Russia (10%), 435 000 t in South Africa (8%), 423 000 t in Canada (8%), 342 000 t in the US (6%), 278 000 t in Brazil (5%), 275 000 t in Namibia (also 5%) and 274 000 t in Niger (5% as well). It should be noted that the current long-term contract price for uranium is about $132/kg ($60/lb), while the spot price is in the $88/kg ($40/lb) to $99/kg ($45/lb) range.
However, there was relatively little exploration for uranium, worldwide, between 1985 and 2003. (The Chernobyl disaster was in 1986). The restarting of exploration soon brought results: in just the two years, 2005 and 2006, global uranium resources were increased by 15%. Moreover, large parts of the world have not yet been explored for uranium. The Brazilian Ministry of Mines and Energy points out that only 25% of that country has so far been prospected for the energy metal. Yet, that limited exploration is still enough to rank Brazil seventh in the world in terms of uranium resources.
New uranium exploration and mining projects are reportedly currently taking place, or planned, in 90 countries. These are Algeria, Angola, Argentina, Armenia, Australia, Bolivia, Botswana, Brazil, Bulgaria, Burkino Faso, Burundi, Cameroon, Canada, the Central African Republic, Chad, Chile, China, Colombia, the Democratic Republic of Congo, the Czech Republic, Denmark (Greenland), Ecuador, Egypt, Finland, Gabon, Gambia, Germany, Guatemala, Guinea, Guyana, Hungary, India, Indonesia, Iran, Iraq, Ireland, Italy, Japan, Jordan, Kazakhstan, Korea (North), Korea (South), Kyrgyzstan, Libya, Madagascar, Macedonia (the former Yugoslav republic), Malawi, Mali, Mauritania, Mexico, Mongolia, Morocco, Mozambique, Myanmar, Namibia, Niger, Nigeria, Oman, Pakistan, Paraguay, Peru, Philippines, Poland, Portugal, Romania, Russia, Saudi Arabia, Senegal, Sierra Leone, Slovakia, Somalia, South Africa, Spain, Sudan, Sweden, Switzerland, Tajikistan, Tanzania, Togo, Turkey, Turkmenistan, Uganda, Ukraine, Uruguay, the US, Uzbekistan, Venezuela, Vietnam, Yemen and Zambia.
Of course, an increase in the uranium price will only increase the amount of economically exploitable reserves. But it would not hurt the economics of nuclear power. “Nuclear energy economics are based on a very substantial initial investment of billions of euros and very low operating costs,” pointed out Sarkozy in his speech.
In 2008, French nuclear group Areva calculated that, for its new EPR, fuel costs would contribute 17% of total kiloWatt/hour (kW/h) generation costs. And, of those fuel costs, 51% would be the cost of the natural uranium, 3% would be the cost of converting this from uranium oxide concentrate into uranium hexafluoride gas, 32% would be the cost of enrichment of the uranium and 14% would be the cost of fabricating the fuel assemblies.
In other words, the cost of uranium would be about 8% of the total kW/h generation costs.
The future development and expansion of civil nuclear energy, worldwide, now seems assured. And that, in turn, assures the long-term future of the global uranium mining sector.
“Some countries have chosen to reject nuclear energy or to stop using it. They have every right to make this choice. But our choice is to look ahead,” said President Sarkozy. “In so doing, we will serve the cause of mankind by reducing pressure on fossil fuel resources and cutting CO2 emissions.”
• Keith Campbell attended the International Conference on Access to Civil Nuclear Power as a guest of the French government