Kazakhstan Chamber of Commerce in the USA

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Kazakhstan may take back some nuclear assets from JVs 0

Posted on March 29, 2016 by KazCham

Colibri Law Firm BI@colibrilaw.com

Kazakhstan may take back some assets from the joint ventures it has set up in the nuclear sector, according to Kazakh President Nursultan Nazarbayev. Nazarbayev explained that some joint venture partners of the state nuclear firm Kazatomprom “are not meeting their obligations”.

“In this regard it is necessary to either ensure that they meet their obligations or look into reclaiming those assets in the interests of our state,” Nazarbayev is quoted as saying.

Kazatomprom has joint ventures with France’s Areva, Canada’s Cameco, Japan’s Sumitomo Corp and Kansai Electric Power, several Russian firms including Rosatom, and a few Chinese companies.

Six countries interested in constructing nuclear plant in Kazakhstan 0

Posted on November 11, 2015 by KazCham

Colibri Law Firm

Kazakhstan has held consultations with leading companies that possess modern reactor technologies, including the companies Rosatom (Russia), Areva (France), Toshiba, Japan Atomic Power Company (JAPC), Mitsubishi, (Japan), CGNPC (China), KEPCO (South Korea), Westinghouse (US), and Hitachi-General Electric (Japan and the US).

During the meetings, the foreign companies provided information about new reactors with improved safety factors as well as about their experience in the construction and operation of nuclear power plants, and expressed interest in cooperating in the construction of the nuclear power plant in Kazakhstan.

The Energy Ministry noted that, to date, two areas have been selected for constructing the nuclear power plant: the town of Kurchatov in eastern Kazakhstan and the village of Ulken in the Almaty province.

The construction of the plant will take a minimum of twelve years; around two years are needed to complete the project’s feasibility study, with at least another ten years for the construction work itself.

Construction of two nuclear plants to be commenced by 2018 0

Posted on January 29, 2015 by KazCham

Business Intelligence from Colibri Law Firm: Issue #100

In 2014 the state nuclear company KazAtomProm and Russian Rosatom signed a cooperation deal on nuclear power, as well as a memorandum of understanding (MoU) on a new nuclear power plant. The design and size of the plant remains open, and was listed only as having generating capacity of 300-1200 MWe. Its siting will be in the Mangistau region (city Aktau).

In 2018 it is expected to commence construction in Kazakhstan of a second nuclear power plant. The location of the second nuclear power plant will be in the village Ulken (a town in the East Kazakhstan region).

After a program of expansion and joint ventures with foreign partners, Kazakhstan now produces about 22,550 tonnes of uranium per year – about 38% of the global total.

Kazakhstan Ends Rise In Uranium Production To Stabilize Prices 0

Posted on November 02, 2011 by Alex

Dow Jones Newswires, Christopher Pala & contributing to Dow Jones Newswires, Oct 03, 2011

ALMATY, Kazakhstan -(Dow Jones)- After more than tripling its output of uranium in four years to become the world’s top producer, Kazakhstan has stabilized production to around 20,000 metric tons annually in order to avoid further depressing prices, Sergei Dara, Director of Strategic Development and International Projects at Kazatomprom, the state nuclear company, said Monday.

He said as long as prices remain at their current low levels, “Kazakhstan will not develop new projects and our production will remain at the current level.”

But the country may still ramp it up to 25,000 tons annually–about 40% of world production–“provided that such quantities are required by the market and we are confident we will realize a fair return on our investments,” he said.

“Prices were low in 2008 and 2009 mostly because Kazakhstan’s production was increasing so fast,” said Stanislav Chuyev, senior analyst at Visor Capital, an investment bank in Almaty, Kazakhstan’s financial center.

“Keeping production at 20,000 tons will help level the prices.”

When production jumped from 8,521 tons in 2008 to 14,020 tons in 2009, Kazakhstan became the world’s largest supplier of uranium. The rise continued in 2010, to 17,803 tons and is expected to be 19,800 tons this year and next year, Dara said.

Also, Kazatomprom, despite already operating some 20 mines in partnership with France’s Areva SA (ARVCY), Russia’s Rosatom, and Canada’s Cameco (CCJ) and others, is continuing a policy of acquiring interests in downstream production plants so it can earn profits from processing operations, not just mining and selling uranium.

“Kazakhstan is looking to be involved in every stage of the cycle except fuel reprocessing and waste disposal,” said Michael Carter, CEO of Visor.

IFASTAR, a new French-Kazakhstani joint venture at the Ulba Metallurgical Plant in Usk Kamenogorsk, eastern Kazakhstan, which was once one of the main suppliers of fuel pellets for Soviet reactors, is preparing to produce fuel assemblies to power nuclear power plants to the specifications of Areva-designed plants around the world. Fuel assemblies, the core of a nuclear power reactor, are assemblies of metallic tubes filled with ceramic pellets containing uranium dioxide powder.

The joint venture, 49% owned by Kazatomprom and 51% by Areva, will have a nominal capacity to produce 400 metric tons of refined uranium in pellets annually, with the first customer set to be China, for whom Kazakhstan is now the principal supplier of natural uranium.

The Ulba plant has already produced two tons of fuel pellets for another China customer as a test run, and is due to start commercial deliveries to China shortly, Dara added.

This year, Kazatomprom is expected to produce about 11,000 tons or uranium, more than either Canada or Australia, with profits expected to be $500 million, Dara said.

Copyright © 2011 Dow Jones Newswires

SOURCE: http://www.kazakhembus.com/index.php?mact=News,cntnt01,detail,0&cntnt01articleid=784&cntnt01origid=15&cntnt01returnid=201

Forging partnerships 0

Posted on April 18, 2010 by KazCham

HE ARREST IN May 2009 of Mukhtar Dzhakishev,  the highly regarded president of Kazakhstan’s  uranium mining and nuclear engineering group  Kazatomprom, together with most of his senior  managers, on alleged theft and corruption charges,  sent shock waves through the Kazakh business world and among dozens of foreign business partners from China to the United States.

Dzhakishev was charged with mishandling  billions of dollars of state property in a controversial  manoeuvre that has removed one of the most highly  qualified and competent state enterprise managers.  Dzhakishev, aged 47, is one of a small group of  highly-educated younger-generation officials who  masterminded the rapid expansion of uranium  mining using in situ leaching methods. He also  negotiated several high-tech co-operation agreements  with foreign, state-owned nuclear corporations and  private mining and engineering groups.

Dzhakishev frequently accompanied President  Nazarbayev and senior government officials on  foreign visits where uranium and linked nuclear  engineering contracts were signed. He has been  replaced by Vladimir Shkolnik, who is considered  a ‘safe pair of hands’ without personal political  ambitions, as one of few high-ranking government  officials who is not an ethnic Kazakh.

Kazatomprom recently announced a 11 per cent  rise in profits to $260 million before ownership was  transferred from the state to Samruk/Kazyna, the state  holding company. The company’s growing importance  as a source of uranium, and Kazakhstan’s record  as a strong supporter of nuclear non-proliferation,  allowed President Nazarbayev to propose Kazakhstan  as the potential site for a long-mooted international  nuclear fuel bank to be set up under the control of the  International Atomic Energy Agency (IAEA).

Establishment of such a site would further raise  Kazakhstan’s global profile, although the proposal  met criticism from civil rights groups who question  whether security, transparency and other issues  connected to such a plant could be guaranteed.

The proposal for such an internationally regulated  fuel bank was first launched by the IAEA in 2005 but enthusiastically taken up by US President Barack  Obama. Significantly, President Nazarbayev made  his proposal during a recent state visit to Astana by  Iranian President Mahmoud Ahmadinejad, whose  nuclear development plans have raised suspicion that  Teheran harbours nuclear weapon ambitions.

Kazatomprom is already working with Russia’s  Rosatom to build the world’s largest internationally  monitored nuclear fuel reprocessing facility at  Angarsk in Siberia. Supporters of a greater role for  the IAEA argue that facilities such as Angarsk and  the proposed ‘fuel bank’ could allow Iran and other  countries to develop peaceful nuclear plants without  raising fears of nuclear weapons proliferation.

Uranium output from Kazatomprom’s conventional  mines and in situ leaching ‘uranium wells’ rose to  8,521 tonnes last year from 6,600 tonnes in 2007. They  are on course to leap a further 40 per cent to 12,000  tonnes this year. With several new mines due to start  production and more in the pipeline, Kazakhstan is  poised to become the world’s biggest uranium miner,  overtaking both former front-runners, Australia  and Canada.

In April, Prime Minister Karim Massimov opened  the latest in situ mining operation at Khorassan in the  Kyzlorda region. It is the first of two new mines being  built in this southern region not far from the Uzbek  border. The new mine is operated by the Kyzylkum  consortium of Kazatomprom, Uranium One and a  group of Japanese power companies who will be the  main customers of the 3,000 tonnes per year of uranium -which the mine is expected to produce when fully on  stream in 2014. This year the new Khorassan-1 mine,  which has taken three years to build at a cost of $432 million, is expected to deliver an initial 160 tonnes.

The sulphuric acid shortages, which limited in situ  uranium leach mining capacity in 2007, are a thing  of the past now that output from the new Kazakhmys  sulphuric acid plant at Balkhash is building up to its  1.2 million tonne a year capacity and work proceeds on h Kazatomprom’s own 500,000-tonne acid facility.

Sulphuric acid, mixed with hydrogen peroxide,  is the main ingredient of the powerful solvent that  miners inject into the extensive sandstone deposits to  leach out tiny uranium particles scattered through the porous rock. These particles are brought to the surface  as slurry for processing, using techniques pioneered by h the oil and gas industry.

But higher profits and fast-growing uranium mine  output are only part of the story. Another key element  in Kazatomprom’s development is the steady extension of international linkages with some of the world’s  leading nuclear engineering and power companies.

Last October, Kazatomprom and China’s leading  nuclear power corporations, China National Nuclear  Corporation (CNNC) and China Guangdong Nuclear  Power Co (CGNPC), signed strategic partnership  agreements in Astana. Under the new deal,  Kazatomprom will participate in the construction  of nuclear power plants in China in return for minority stakes for the Chinese companies in three  new mines.

Beijing plans to build no fewer than 56 nuclear  power plants over the next decade or so. This opens  up a huge new potential outlet for the engineering  skills, which many of Kazatomprom’s 25,000-strong  workforce first developed in Soviet times, but have  since built up through a series of high-level technical  co-operation agreements with Russian, Japanese,  US, Canadian and European nuclear engineering  companies.

The core of this downstream engineering strategy  is Kazatomprom’s 10 per cent stake in Westinghouse,  bought for $540 million in 2007. Japan’s Toshiba  controls the nuclear power plant manufacturer  through its 67 per cent stake, while a further 20 per  cent is held by the US Shaw group and 3 per cent  by IHI, the Japanese heavy engineering corporation.  Access to Kazatomprom’s uranium gives Westinghouse  the ability to guarantee power plant customers fuel  supplies for the entire life of their reactors.

Access to Kazakh uranium is also a crucial part of  Japanese plans to build 13 more nuclear power plants  over the next decade. Earlier this year a group of  Japanese companies, led by Tokyo Electric power and  Toshiba, added indirectly to their existing Kazakh  involvement by buying 19.5 per cent of Canada’s  Uranium One, which has a 70 per cent interest in the  joint venture that owns the Akdala mine and stakes in  the South Inkai and Khorassan projects – in addition  to assets in the US, South Africa and Australia. With  scant domestic energy resources, Japan has built up  stakes in several Kazakh mines as competition mounts  for access to uranium from other potentially large  consumers, such as China and India.

Last November, Japan’s Nippon Export and  Investment Insurance agency (NEXI) more than  doubled its credit coverage insurance for joint  uranium projects from $48 million to $114 million.

The deal underlined how Kazatomprom remains  practically immune from the credit problems affecting other clients of over-borrowed Kazakh banks.

For Kazatomprom, the Japanese links are an  important element in a series of technical co- operation agreements with Canada’s Cameco and  Uranium One, Cogema of France, Nukem from the  US, and others. The policy of leveraging access to  uranium mines in return for technical co-operation  is also reflected in the recent China deal. By opening  up its nuclear construction market and offering co- operation in nuclear fuel processing, China gained  sought-after equity stakes in three new uranium  mines and secured a long-term source of nuclear fuel  for its ambitious nuclear power plans.

Kazatomprom retains a controlling 51 per cent stake h in the three mines, with Guangdong taking a 49 per  cent share in both the 750-tonne-a-year Irkol mine in  Kyzlorda region, and the 500-tonne-a-year Semizbay  mine in Akmola region. CNNC will get a similar stake  in the Zhalpak mine in South Kazakhstan.

“One of the key terms of the agreement is not  just participation in Chinese nuclear power plant  construction, but also the fuel supplying these NPPs  [nuclear power plants]. Kazatomprom is the first  company to gain access to the closed nuclear fuel  market of China,” Mukhtar Dzhakishev commented  after signature of the deal.

Three months after concluding the strategic deal  with China, Dzhakishev accompanied President  Nazarbayev on his state visit to India and signed  a memorandum of understanding to broaden the  budding nuclear partnership with the Nuclear  Power Corporation of India. Under the agreement,  Kazatomprom will supply both natural uranium  and uranium fuel pellets for India’s nuclear energy programme, which envisages 24 nuclear plants by  2020. In return, Kazatomprom will gain access to  India’s PHWR technology.

The nuclear co-operation agreements with China  and India both took place in the context of state visits  by President Nazarbayev, for whom Kazatomprom is a  powerful symbol of Kazakhstan’s growing industrial  and financial status. This is a pattern first established  three years ago at a summit meeting between President Nazarbayev and then Russian President Putin.

Kazakhstan’s legacy as a former Soviet state means  that establishing Kazatomprom’s independence  and broadening its international connections has  required considerable diplomatic subtlety. Many of the company’s Russian-speaking technical and managerial staff retain close, personal and professional relations  with counterparts in Russia. Although a substantial  uranium producer itself, Russia needs secure supplies  of Kazakh uranium to guarantee future fuel needs. Rosatom, Russia’s nuclear energy corporation, plans  to build 26 new nuclear plants in Russia alone by 2030 -and others in Bulgaria, China, India and Iran.

Moscow sees Kazakhstan as an indispensable source  of uranium, and a close partner in key technologies,  such as uranium enrichment. Nuclear co-operation  is a good example of how the overall Russo-Kazakh  relationship has moved from domination to  partnership since independence. But it has not been  easy and there is still reluctance to share technology in some cases. Two years ago, Rosatom and Kazatomprom agreed to build a 65mw nuclear power plant based  on technology initially developed to power nuclear  submarines. But plans to build a power station based on this technology at the Caspian port city of Aktau  have been delayed, pending agreement on the transfer of intellectual property.

Invest in Kazakhstan An official publication of the Government of the Republic of Kazakhstan, 2009. Pages: 60-62.



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