Russia uranium miner plans $7.4 billion expansion

Russia's state uranium miner plans to invest 203.6 billion roubles ($7.4 billion) by 2015 to fund a massive expansion plan as demand from the nuclear power sector grows, the company's general director said on November 26.
Atomredmetzoloto (ARMZ) General Director Vadim Zhivov told Reuters the company, which produces uranium in Russia and Kazakhstan, planned to increase output of the metal to 4,300 tonnes next year from 3,880 tonnes expected in 2008. Zhivov said in an interview the financial crisis had not affected his company's spending plans so far, despite the fact 172.3 billion roubles ($6.3 billion) of the planned investment would not be funded from the Russian state budget.
Russia holds more than 10 percent of the world's uranium reserves and is positioning itself as a major player in meeting growing demand from the fast-growing nuclear industry.
Zhivov said ARMZ, the mining arm of Russian state atomic agency Rosatom, would seek external funding from banks and would team up with strategic partners to develop new deposits, most of them in Siberia and the Russian Far East.
"All our strategic partners, in Japan, France and Canada, have confirmed their plans," Zhivov said. "Of course, there could be corrections to these plans, but nobody has said anything about that."
ARMZ is participating in joint ventures with Canada's Cameco Corp, the world's largest uranium miner, and Japan's Mitsui & Co to develop Russia's reserves, the world's third-largest. Zhivov said Rosnedra, the division of the Natural Resources Ministry that governs mining licences, would distribute new licences next year for ARMZ's joint venture with Cameco.
Rosnedra estimates Russia's uranium reserves at 545,600 tonnes. ARMZ produced 3,527 tonnes in 2007, of which 3,413 tonnes was produced in Russia. The 2008 forecast of 3,880 tonnes includes 3,580 tonnes of Russian production.
The largest uranium miner within the state holding is the Priargunsk Mining and Chemical Production Union, which mined 3,037 tonnes at its deposit near the Chinese border last year. This year's growth will come mainly from new deposits elsewhere in Russia. Another company within the group, ZAO Dalur, last year produced 350 tonnes of uranium in the Siberian region of Kurgan and plans to raise 2008 output to 410 tonnes. The Khiagda mine in the Buryatia republic produced 26 tonnes last year and plans to produce 120 tonnes in 2008.