January 29, 2012

Uranium Supply Crunch By 2016

Published on Saturday January 29 2012 (AEST).

A nuclear expert gave uranium supply three more years at most before it seriously falls behind demand from the nuclear power industry.

Mr Thomas Drolet president of Drolet and Associates Energy Services said during a presentation at Cambridge House's Vancouver Resource Investment conference that "2016 We have to have supply in the market or the lights will gradually go out in the nuclear system."

A uranium supply crunch is widely anticipated to hit the nuclear industry starting next year as Cold War era sources of uranium dry up. To illustrate the severity of the shortage that the nuclear industry faces, Drolet highlighted 2010 uranium production from mining 118 million pounds versus consumption 190 million pounds.

Mr Drolet said that you can do the delta difference yourself referring to how much of a supply gap miners will have to make up for in coming years. That uranium is going to have to come from somewhere.

Mr Drolet argued that the Fukushima nuclear disaster in Japan, only delayed the onset of the coming pinch on uranium supply. But even in his downside analysis the uranium deficit still comes by 2015.

While Japan has idled most of its 50 nuclear reactors in the wake of Fukushima, Mr Drolet wagered that the country would have no choice but to bring online at least 30 of the reactors or suffer brutal economic consequences. If it did not do so industry in Japan would start to fail.

(Sourced from www.mineweb.com)

January 18, 2012

Mitsubishi Predicts Restart for Japan Reactors

Published on Wednesday January 18 2012 (AEST).

TOKYO—The chief executive of Mitsubishi Heavy Industries Ltd. said he expects Japan's idled nuclear reactors to restart operations this spring despite widespread safety concerns among the Japanese public, and that the domestic backlash against nuclear technology won't affect overseas demand.

Japan has idled all but five of its 54 commercial reactors, and has been conducting so-called stress tests to gauge nuclear plants' resilience to natural disasters. So far, no Japanese reactor shut down for regular maintenance has been restarted amid the public's safety concerns after the March tsunami that triggered an accident at the Fukushima Daiichi nuclear complex.

But Hideaki Omiya, Mitsubishi Heavy's president and chief executive, said during an interview with The Wall Street Journal that he is confident the plants will resume operations soon, after they gain approvals from local officials nearby.

"My sense is that this process will be completed by spring, and from spring to summer this year there will be a resumption of operation at some power plants," Mr. Omiya said.

The Japanese heavy-equipment manufacturer is one of Japan's three major nuclear-plant-equipment makers, along with Hitachi Ltd. and Toshiba Corp. Nuclear equipment accounts for about one-third of Mitsubishi Heavy's nearly ¥1 trillion ($13 billion) in power-systems revenue, which itself makes up 34% of the company's total revenue—the largest of its six core businesses.

The last of Japan's reactors still in operation are slated to go offline by May, effectively eliminating the source of one-third of the country's electricity supply.

The Japanese government has signaled its intent to persuade municipalities near nuclear plants to approve restarts before the traditional midsummer peak in demand for electricity.

Prime Minister Yoshihiko Noda has vowed to scrap plans for new plants as part of a policy designed to gradually reduce Japan's dependence on nuclear energy as older reactors are decommissioned.

Still, Mitsubishi Heavy is optimistic about nuclear energy's future outside its home market. "There's been a severe backlash against nuclear-plant construction in Japan so we don't expect to see a lot of new reactors here for some time," Mr. Omiya said. "But globally, demand for nuclear power is not declining."

While the company expects to see higher revenue from safety upgrades of existing nuclear plants in Japan and increased reactor decommissioning projects, the loss of new domestic orders has prompted it to curtail growth plans. The company abandoned a goal of doubling its annual nuclear revenue of ¥200 billion to ¥300 billion by 2014, Mr. Omiya said.

Mr. Omiya said he expects to see strong demand at home and abroad for power-generation equipment, especially natural-gas-fired plants.

Mitsubishi Heavy has been hurt by the sharp appreciation of Japan's yen against the dollar and other currencies to record levels because it depends on foreign markets such as the U.S. and China for about 50% of its sales. A strong yen reduces the price competitiveness of exports and erodes the yen value of dollar-denominated profits.

Noting that Mitsubishi Heavy loses about ¥5 billion for every one yen appreciation in Japan's currency against the dollar, Mr. Omiya said the company might shift more of its output overseas. "If the current yen strength continues…manufacturers like us will move more production offshore and spur the hollowing out of Japanese industry," he said.

The European financial crisis is another headache for Mitsubishi Heavy and other Japanese exporters, even though their direct exposure to euro-denominated sales might be limited. "We're worried about how the European crisis will affect the [overall] Japanese economy," Mr. Omiya said. "The impact on the U.S., China and the rest of Asia is also a big concern."

For the fiscal year ended on March 31, Mitsubishi Heavy said Europe accounted for 15% of its net sales, compared with 26% from Asia and 21% from the U.S.

January 13, 2012

John Collier Speaks On Nuclear Power Plant Safety

Published on Friday January 13 2012 (AEST).

John Collier video recorded in 1995. A significant proportion of our electricity is generated by thermonuclear reactions. The dangers attached to these processes and the radioactive products are well known and publicized. Much less well known are the measures taken to ensure that the highest levels of safety are realized in practice.

January 12, 2012

Flooding At Ranger Uranium Pit May Hit Energy Resources Production

Published on Thursday January 12 2012 (AEST).

URANIUM miner Energy Resources of Australia today said the highest December rainfall on record had flooded its Ranger pit in the Northern Territory, preventing it from accessing high-grade ore.

ERA, which is controlled by Rio Tinto, said it hasn't been able to fully drain the pit, and that access is highly dependent on rainfall experienced for the rest of the wet season. The delay may impact uranium oxide production in the 2012 calendar year, it said.

ERA reported a 30 per cent increase in output to 2641 tonnes for the 12 months to December 31, 2011, although this was coming off a low base amid a difficult period for the miner.

Ranger, the second-biggest uranium mine in the world by production in 2010, is just about spent and ERA is encountering lower-grade ore at the bottom of the pit, triggering a spate of production downgrades.

"The delay in obtaining access to the high-grade ore located towards the bottom of Pit 3 may impact production of uranium oxide in 2012. However, the extent of this impact is presently uncertain," ERA said in a statement.

The company recently ditched plans to build a heap leach facility to process poorer quality ore, and instead chose to pursue a possible expansion of Ranger through development of the adjacent Ranger 3 Deeps deposit.

January 6, 2012

Uranium Spot Volume Climbs to Record Level in 2011

Published on Friday January 06 2012 (AEST)

DENVER, CO, Jan 05, 2012 (MARKETWIRE via COMTEX) -- The year 2011 was a tumultuous period as uncertainty clouded the uranium market and TradeTech's U3O8 Spot Price Indicator (bloomberg:TDTC) ended the year at US$52.00 per pound U3O8, amid record spot volume as the market continued to stabilize following the crisis at a Japanese nuclear power facility in March.

Early in the year the uranium market showed signs of stability as the spot price followed a strengthening trend that began in 2010, when the market was recovering from a global financial crisis that began in late 2008. TradeTech's Weekly U3O8 Spot Price Indicator had climbed to US$73.00 per pound U3O8 on February 4. However, the spot price settled at $67.75 on March 11, when Japan's Fukushima nuclear station was severely damaged by a devastating earthquake and tsunami.

As the crisis continued to unfold, buyers and sellers considered potential short- and long-term impacts of the events in Japan while the uranium market tried to regain stability. On August 26, the spot price fell to the lowest point of the year -- $48.85 -- before rebounding to $56.25 by mid November, when traders became more active and purchased the majority of material sold that month. As 2011 came to a close, spot market demand remained primarily discretionary and TradeTech's U3O8 Spot Price Indicator was $52.00 per pound U3O8, the company noted in its December 31 Nuclear Market Review.

Despite price volatility affecting the spot uranium market throughout much of 2011, higher spot volume prevailed to set a new record of 45.8 million pounds U3O8, surpassing spot transaction volume of 42.8 million pounds U3O8 in 2010, the highest level recorded in two decades.

"Fourth quarter sales of more than 9 million pounds brought 2011 spot market volume to a new record level, as traders, uranium producers, and financial entities attempted to place material before year end," TradeTech President Treva E. Klingbiel said.

"Presently, spot uranium supply remains extremely thin as most sellers hold firm to offer prices and wait for increased demand during the first quarter of 2012. Demand is expected to gain momentum in January, with price volatility returning to the market as activity increases," Klingbiel added.

January 5, 2012


Published on Thursday January 05 2012 (AEST)
SASKATCHEWAN - The second shaft at the Cigar Lake uranium project reached the mine workings 480 metres below surface on Jan. 3, 2012. The project is operated by Cameco (50%) of Saskatoon. Areva Resources Canada (37%), Idemitsu Uranium (8%) and Tepco Resources (5%) hold equity stakes in the project.

The second shaft will provide for improved ventilation underground and an additional means of accessing or exiting the mine.

"The breakthrough is a key milestone on our path to safe, clean and reliable production from this exceptional orebody," said Cameco president and CEO Tim Gitzel. "We expect to resume full mine development and construction activities in 2012 and remain on track to start ore mining by mid-2013."

Construction at Cigar Lake was begun in 2005, and development had to be halted in June 2005 when the workings were flooded following a major inflow of brine via the second shaft. Originally, Cameco thought construction would be delayed six months and the extra costs would amount to 10% or 20% of the original $520 million construction budget. 

The remediation eventually cost in the neighbourhood of $102 million. It was carried out in phases that included cement injection at the problem area, installation of freezing equipment, securing areas where future rockfalls might start more water problems, and rehabilitating all the underground systems such as ventilation and pumping.

During 2011 the rehabilitation was completed and regulatory approvals were secured for a revised mining plan and increased discharge capacity for treated water. Freezing the orebody from surface has also begun.

Information about the high grade Cigar Lake deposit is posted at www.Cameco.com.