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Vladimir Verkhovtsev: we expect a significant increase in uranium prices not earlier than 2020-2022
Vladimir Verkhovtsev, General Director of JSC Atomredmetzoloto, told EastRussia about how the company survives in a depressive situation on the uranium market.
JSC Atomredmetzoloto is one of the leaders in the world of uranium mining. However, the industry found itself in a very difficult situation: since the accident at the Fukushima-1 nuclear power plant in 2011, world prices for uranium have significantly decreased, and as of mid-2014, their decline reached 2,5 times.
The most important component of the program to break even, according to Vladimir Verkhovtsev, is a reduction in costs through the introduction of unique technologies in production. To reduce the cost of production of uranium for 2019, a complex of measures has been worked out in detail, including both complex and painful measures to optimize costs, numbers, productivity growth, and programs for the development of new mines, technological innovations and a number of non-nuclear projects.
The results already achieved by the team of OOO PIMCU (the largest enterprise in the raw materials industry of Rosatom) are encouraging: for the first time since its transfer to the holding's management, the unit cost of uranium mining has decreased by 7% compared to last year.
Also recently, a protocol was signed with the largest Chinese companies, such as Sinopec International Company Rus, which consolidated the parties' intentions to build the largest coal chemical industry enterprise in the Trans-Baikal Territory. The construction of the plant with the capacity of 500 thousand tons per year is planned according to the Chinese technology CTL, which will allow to produce synthetic fuel of the highest category with minimal expenses.
Another joint project with the Chinese side is the construction of a cement plant in Krasnokamensk. Estimated capacity - 326 thousand tons of cement per year. The project will not only completely cover the own need of JSC PIMCU, but also provide cement for the Trans-Baikal Territory and the neighboring regions. At the same time, we will significantly reduce costs, including through logistics. The nearest cement supplier is located at a distance of more than a thousand kilometers. In addition, the creation of new, including high-tech jobs, will have a positive impact on the development of the entire region. Currently, work has been completed on the development of a preliminary feasibility study of the project.
Currently, work is underway in relation to the Elkon uranium project in Yakutia, the completion of which is scheduled for 2019. Production is scheduled to start closer to 2030. Vladimir Verkhovtsev emphasizes that work is already underway on breakthrough solutions that will improve the efficiency of the project.
The rise in uranium prices, according to the General Director of JSC Atomredmetzoloto, is possible not earlier than 2020-2022. It will be driven by the growing needs associated with the construction of new nuclear power plants in China, India, South Korea, the states of the Middle East - the UAE, Turkey, Iran and other countries.