Opportunity for Kazakhstan’s uranium industry – The Diplomat

March 28, British Prime Minister Boris Johnson announced that in order to reduce its dependence on Russian gas and oil, the United Kingdom could increase its dependence on nuclear energy to up to 25% of its energy needs. As the Russian invasion of Ukraine changes the global geopolitical system and Europe and the UK seek to diversify their energy suppliers, one of the winners of greater future energy dependence nuclear could be Kazakhstan’s uranium industry.

Some energy companies are already cutting ties with Russian suppliers. Example : the Swedish nuclear energy company Vattenfall AB announced on February 24 that it would halt planned deliveries of nuclear fuel from Russia and that it would not place new orders until further notice. by Vattenfall President and CEO Anna Borg noted that “we have obtained alternative deliveries of nuclear fuel”. Kazakhstan is already one of the company uranium suppliersbut it is unclear whether Vattenfall will procure additional uranium from the Central Asian country or from another source.

Kazakhstan and Europe are close partners in nuclear energy. Kazakhstan is Europe’s third-largest supplier of uranium, supplying 19.2% in 2020, after Niger (20.3%) and Russia (20.2%). The UK derives its nuclear power from both civil plutonium and highly enriched uraniumand according to youo the World Nuclear Association, the “uranium is importedso do conversion services.

As London debates its future for civilian nuclear power, a key player to consider is Kazatomprom, Kazakhstan’s atomic company and the world’s largest producer of uranium. Of the society 2021 financial resultspublished in March, noted that the production of triuranium octoxide (U3O8), a compound of uranium, reached 19,477 tU in 2020 and increased by 12% to reach 21,819 tU in 2021. “The production volume in 2022 is expected to be between 21,000 tU and 22,000 tU”, said explained the company, while noting that -supply chain challenges continue to limit access to some important materials and equipment.

An obvious question, given the intentions of European policymakers and companies to boost nuclear power generation, is whether European customers will turn to Kazatomprom to meet the increased demand for uranium. Kazatomprom hasn’t publicly mentioned this possibility, but new contracts are expected to be signed soon.

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A Comment from March 18 in The Conversation discussed Russia’s role as a key nuclear supplier. Even though Kazakhstan produces more than 40% of the world’s uranium supply, the article notes that “much of Kazakhstan’s ground uranium transits through Russia before being exported to world markets.” Additionally, “only a handful of facilities worldwide convert ground uranium into uranium hexafluoride; Russia produced about a third of the 2020 offer, much of which is made with uranium from Kazakhstan. While key logistical issues, including transportation to avoid Russia and conversion, will need to be resolved, Kazakhstan’s Kazatomprom is in an ideal position to position itself as Europe’s reliable uranium supplier.

It should be noted that the uranium price increased since the start of the war in Ukraine. The price was $30.35 per pound in January 2021, $45 on February 28 (four days after the invasion began), and reached $56.70 on March 25. At the time of writing, the price is over $60 per pound. As the world’s largest producer of uranium, Kazakhstan has everything to win big.

Kazakhstan’s uranium deposits and nuclear-related activities are a historically sensitive issue, given that its territory was used for massive nuclear testing during the Soviet period. After the Cold War, Kazakhstan, under the leadership of President Nursultan Nazarbayev, voluntarily renounced its vast nuclear arsenal. It was a rare example of post-Cold War Moscow and Washington, as well as the nascent Kazakh state, work together to transfer nuclear warheads and other weapons to Russiawhile the Semipalatinsk test site and other facilities were dismantled.

While the Nazarbayev regime has recently been criticized for its excessive centralization of power, giving up its nuclear arsenal was a laudable choice that was codified in the 2006 treaty on the Central Asia Nuclear-Weapon-Free Zone, signed in Semipalatinsk, the location of the nuclear firing range. The fact that Central Asia today does not have nuclear weapons in this vast territory stems from these decisions of the early 1990s.

Since its independence three decades ago, Kazakhstan has maintained a balanced and neutral foreign policy, a key pillar of the multi-vector diplomacy initiated by Nazarbayev and continued by the current President, Kassym-Jomart Tokayev. In terms of trade and commerce, before the war in Ukraine, Nur-Sultan was already aiming to diversify and expand its partnerships with Europe and the UK to attract more investment.

The war has put energy and food security high on the agenda for the UK and the rest of Europe, as well as deterring Russia. Kazakhstan has the potential to become a larger supplier of uranium to Europe, helping to ensure energy security and demonstrating that the Eurasian nation is a reliable trading and energy partner.

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