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The Future of the Uranium Market Feeding Asias Rapidly Growing Need Milt Caplan, President Dr. Terry Thompson, Senior Advisor MZConsulting Inc.

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Presentation on theme: "The Future of the Uranium Market Feeding Asias Rapidly Growing Need Milt Caplan, President Dr. Terry Thompson, Senior Advisor MZConsulting Inc."— Presentation transcript:

1 The Future of the Uranium Market Feeding Asias Rapidly Growing Need Milt Caplan, President Dr. Terry Thompson, Senior Advisor MZConsulting Inc.

2 2 New Nuclear Build is Underway Nuclear renaissance takes hold France starts construction UK Government confirms support for nuclear new build First government guarantee approved in the USA UAE commits to new build Numerous other countries looking to nuclear power going forward 62 units under construction, 158 planned and 324 proposed* Events in Japan at Fukushima will impact these plans *WNA website, data for Mar 1, 2011

3 3 New build in Asia is BOOMING! China has 27 units under construction India and Korea another 10 China and India –7% of plants in operation –~ half of those under construction, planned and proposed Korea has 21 in operation and another 11 underway and is becoming an exporter of nuclear power Note: Russia has 8 units under construction, 14 planned and 30 proposed.

4 4 Global Uranium Supply & Demand WNA Market Report 2009

5 5 China Current capacity – 13 units, 10,000 MW Planned growth –Original plan to 2020 – 40,000 MW –Increasing target to 75, ,000 MW by 2020 –Continued growth to 200,000 MW by 2030 Uranium requirements –4,400 tonnes in 2011 (first cores) –to ,000 tonnes per year base 15,000 tonnes per year or 30% of current production! –To ,000 tonnes per year!!

6 6 India Current capacity 4,400 MW Planned growth –20,000 MW by 2020 –63,000 MW by 2032 Opening to the world Uranium demand –1,000 tonnes in 2010 –4,000 tonnes by 2020 –12,000 tonnes by 2030

7 7 Korea Current Capacity 21 units, 18,700 MW Planned growth –to ,000 MW –to ,000 MW Uranium Demand –3,600 tonnes in 2011 –5,400 tonnes in 2020 –7,000 tonnes in 2030 Korea planning to become a major exporter of nuclear power to the world

8 Total Demand (tU/yr) CountryDemand 2020 Demand 2030 China15,00040,000 India4,00012,000 Korea5,4007,000 Total Demand24,40069,000 About half of primary production in 2009 Almost 40% more than primary production in 2009

9 9 Uranium Resources

10 10 Production by Country CountryProduction tU 2009 Kazakhstan13820 Canada10173 Australia7982 Africa7869 Russia3564 Uzbekistan2429 USA1453 Others3282 Total50572

11 11 Production by Company CompanyProduction tU 2009 Areva8623 Cameco8000 Rio Tinto7963 KazAtomProm7433 ARMZ4624 BHP Billiton2955 Navoi2429 Uranium One1368 Paladin1210 General Atomics583 Other5384 Total50572

12 12 Where will it come from? Strategy has three major components –Domestic production –Foreign purchase –Investment in foreign resource Development of a strategic inventory Requirement for uranium supply when contracting for foreign plant

13 13 The rise of State Capitalism State Capitalism –State dominates the market –Primarily to meet political goals rather than individual goals in a free market economy –Huge sovereign wealth funds used to meet country objectives

14 14 Politics Australia has policy of not exporting uranium to India Canada has policy limiting foreign ownership of mines to 49% China prefers to have control of resources rather than minority shares

15 15 Recent Market Activity CountryMarket Activities KoreaInvestments in uranium producers (Denison Mines) Investments in uranium Juniors Investments to support new enrichment ChinaConcluded agreement with Cameco for uranium purchase Invested in uranium juniors in Africa, Australia and Mongolia Purchased 17,136 tonnes in 2010 to bolster strategic reserve Started production from Chinese owned mine in Africa (Azlik) IndiaPurchased uranium from Russia and from Areva Not yet entered the foreign production market Note: Russia has been very aggressive in it expansion with the strategic investment in Uranium One

16 16 The New World of Uranium By 2020 demand in China, Korea and India will be about 25,000 tU/yr Will require about a third of global production Will invest in new and existing mines Will invest in new and existing companies

17 17 Summary Significant growth in nuclear power Most of the growth will be in Asia Large Asian users have little resource and will want to ensure security of supply State driven economies will impact strategies China, India and Korea will follow a multi- dimensional strategy including investing in the resource Decisions continue to be affected by politics The uranium market will fundamentally change as the large users move from the west to Asia!


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