Nuclear needs drive quest for overseas uranium rights
China is looking to buy uranium mining and exploration rights overseas, particularly in East Asia and Africa, to satisfy its ever-increasing demand for ore as the country steps up installation of nuclear power plants, a senior energy official says.
But hasty acquisitions overseas could be difficult and risky, industry sources said.
Cao Shudong, deputy director of the National Energy Administration's Department of Electrical Power, told China Business News on Saturday that securing supplies of uranium ore would probably be the biggest hurdle to expansion of the mainland's nuclear sector.
'To meet the target of being able to produce 100,000 megawatts by 2020, our analysis shows that about 88 per cent of the uranium ore needed will have to be imported, and it will be a big problem,' the newspaper quoted Mr Cao as saying.
'Recently, we have been preparing to set up a national reserve for natural uranium, encouraging not only government agencies, but the business sector, as well, to contribute to the stockpile.
'Thanks to the global financial crisis, the price of energy has dropped, and the government will allocate some funds and issue new policies to encourage the business sector to buy mining or exploration rights in places such as Kazakhstan and Africa.'
The State Council still has to approve the 100,000MW goal, and Mr Cao told the Shanghai Securities News that the final figure might drop to 75,000MW. Still, both targets are a big jump from the 40,000MW target announced by the central government less than two years ago.
A senior engineer at the China National Nuclear Corporation (CNNC) said there were more than 200 uranium mines on the mainland, with enough reserves to meet domestic demand for more than three decades.
'It is technically incorrect to say that China is running short of uranium,' the engineer said. 'We have discovered deposits in more than 20 provinces, and we still have to survey half of the land mass.
'Sadly, most of our ore is poor quality. Extracting fuel-grade uranium would be costly. Plus environmental issues have become a serious concern for our citizens, so it is natural for the government to turn to high-quality mines overseas.'
Industry sources said China's acquisition campaign had been quietly under way for a few years.
Deals had been made or were in the works with Australia, which accounts for more than 30 per cent of global production, as well as France, Russia, Kazakhstan, Mongolia and some uranium-rich countries in Africa.
But the sources also said there were problems that had cost the government dearly.
In December 2006, CNNC established the China Nuclear International Uranium Corporation, known as Sino-Uranium, to facilitate global mining and acquisition. Seven months later, one of the company's senior project managers, Zhang Guohua, was abducted in Niger by anti-government militants.
The militants accused the company of exploiting the country's natural resources, mistreating local employees and providing firearms to the government of Niger.
The Chinese embassy and the company paid a ransom, and the rebels released Mr Zhang after a few days.
A lack of ore
The mainland has set a target of producing 100,000 megawatts of power by 2020
The authorities estimate the proportion of uranium ore it will need to import is: 88%
