Pinning Down Production Costs
Given the move toward cleaner energy, reduced carbon emissions, and more secure long-term energy sources, uranium supply is becoming more important to utilities worldwide. Currently, in our post-Fukushima demand case, uranium demand is still projected to nearly double by 2030, mainly due to increased demand from Southeast Asia – China in particular.
With the U.S.-Russia HEU Agreement coming to an end this year, resulting in the elimination of 24 million pounds U3O8 per year from the market, and other secondary supplies and mine reserves being depleted, there is much greater emphasis on primary production today than ever before. It has only been until recently that uranium exploration has experienced a revival, but even this is being threatened in the post-Fukushima environment as many suppliers now find it much more difficult to obtain the required financing to bring new projects into production.
As a result, the current menu of worldwide projects is not all that exhaustive due to the fact that most of the recent exploration has been on brownfield sites that were discovered 20, 30, or even 40 years ago. Although uranium resources are extensive, the vast majority of these are neither delineated nor developed. As the nuclear industry transforms itself into a safer and robust industry, one of the challenges will be for the supply side of the industry to expand and bring new production to a market still recovering.
This detailed study complements UxC’s Uranium Market Outlook (UMO) and Uranium Supplier’s Annual (USA) in identifying where expanded and new uranium supply will come from among 116 worldwide projects to meet future nuclear fuel demand through 2030.
UxC’s Uranium Production Cost Study will address a wide range of production cost issues including the following:
- Factors Affecting Production Costs - Extensive review of factors impacting productions costs, such as ore grade, reserve tonnage, deposit depth, spatial density, ore thickness, deposit composition and chemical agents, various technical factors, water flows and drainage, energy costs, labor costs, transportation/hauling costs, etc.
- Uranium Mining/Milling Costs - Overview of mining/milling costs for conventional and ISR deposits, focusing on operating and capital costs for each mining method. The breakdown of typical operating costs for both acid leach and alkaline leach processing circuits is also presented.
- Financial & Market Considerations - Discussion of the time value of money and how this works in calculating the present value of a project, and the importance of accounting for market conditions in a producer’s decision of whether to invest in or develop a mine.
- World Production Costs - Cost curves for operational, planned, and potential projects are developed to identify those projects most likely to produce in the future, as well as expected cost curves for 2013, 2015, and 2020 production.
- Matching Production Costs to Prices - Analysis of why prices are considerably lower than in our marginal-cost pricing picture, with a broad discussion of floor prices, term prices, and spot prices.
UxC’s 2013 Uranium Production Cost Study is available immediately at a rate of US$6,000.00.
Subscribers of either UxC’s UMO or USA reports receive a discounted rate of US$4,500.00.
Subscribers of both UxC’s UMO and USA reports receive a discounted rate of US$3,000.00.
For more information on the Uranium Production Cost Study, please contact Nick Carter.