Kazatomprom Announces Plans to Ramp Up Production of Uranium in 2024

In its latest mid-year financial update, Kazatomprom revealed that it planned to increase its production for uranium in 2024. Kazatomprom is the biggest producer and seller of natural uranium globally, producing more than 40% of primary uranium supply. The company, which operates as Kazakhstan’s national operator, is involved in the import and export of uranium and its compounds.

Yerzhan Mukanov, the company’s chief operational officer and acting CEO, announced that taking into account evolving production and mine-development constraints, the company expected to increase potential uranium production by between 2,000 to 3,000 tU in 2024. Mukanov also stated that the substantial geopolitical developments and unprecedented economic uncertainty witnessed globally during the first half of 2022 had tested the company’s corporate risk management practices.

He explained that the firm believed the fundamental shift in the demand-supply balance was still underway despite the improvement in the uranium market, which had seen significantly improved pricing, a thinning near-market term and a rise in long-term contracting interest. This, Mukanov noted, would create ongoing opportunities for the company as a primary supplier that maintained a disciplined approach. However, he added that risks to both the production of uranium and development of mines from supply chain challenges remained significant.

The company also revealed that the decision to increase uranium production was based principally on the its mid-term and long-term contracts with existing and new clients, noting that the current contract book offered adequate confidence that the additional volume would have a secure place in the uranium market. The uranium producer expects its production in 2024 to be roughly 25,000 tU. Kazatomprom plans to work with mining subsidiaries and joint venture partners to mitigate any challenges that may arise as a result of issues with the global supply chains.

Currently, Kazatomprom’s primary shipping route runs through St. Petersburg in Russia. This route has had no issues in the recent past, despite present geopolitical uncertainty brought about by Russia’s invasion of Ukraine. Askar Batyrbayev, the company’s chief commercial officer, stated that this primary route had already been used a number of times this year and remained uninterrupted.

Despite this positive news, Kazatomprom intends to use an alternative route through the Caspian Sea as the year progresses. This alternate route, which was developed in 2018, does not cross into any Russian territory. However, in comparison to the principal shipping route, the Caspian Sea route may be more costly to use.

Chances are high that other uranium producers such as Energy Fuels Inc. (NYSE American: UUUU) (TSX: EFR) have also seen an uptick in the orders for this metal that they receive, and these players are also possibly evaluating how their future production estimates may be revised.

NOTE TO INVESTORS: The latest news and updates relating to Energy Fuels Inc. (NYSE American: UUUU) (TSX: EFR) are available in the company’s newsroom at http://ibn.fm/UUUU

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