Page 1

ARMZ Uranium Holding Co.: An emerging Asia leader in uranium mining

Dmitry Shulga, Director, External Affairs & Investor Relations Asia Mining Congress 2009, March 2009

ARMZ in Russian Nuclear Industry ARMZ

• Uranium mining and supply • Worldwide mining and exploration • World’s №2 in uranium resources • World’s №5 in uranium production Energoatom

• Nuclear power plant


operation, generation and sales


• Uranium enrichment, export sales • 40% of world’s uranium Full nuclear fuel cycle, NPP construction, power generation


• Nuclear fuel fabrication, export sales • 17% or world’s nuclear fuel market (every 6th reactor)

enrichment capacity

ARMZ Today 2008 Uranium resources, thou. tons (in-situ) Paladin Energy 2% VostGOK 3%

Others 11%

Navoi Uranium One 3%

BHP Billiton 33%


2nd in uranium resources

5th in uranium production

Russia’ s only uranium mining company

ARMZ owns Priargunsky - the world’s largest mine as for aggregated historical U production - over 130 thousand tons of uranium

Highly diversified by mining technology and geography – Russian miners use all known uranium mining methods – Exploration and mining projects in 3 continents 14 thousand employees in production sites and service companies

Kazatomprom 7% Cameco 7% Rio Tinto 9% AREVA 10%

ARMZ 538 11% nd 2 place

2008 Uranium production, tons CAMECO 16% AREVA 16%

Rio Tinto 18%

Paladin Energy 2%

Kazatomprom 11%

Others 13%

Uranium One 3%

Navoi 5%

BHP Billiton 8%

• ARMZ 3687 8% 5th place

ARMZ Global Presence 11




3 14


5 4

6 7 1



Operational and under construction facilities 1. Priargunsky 2. Khiagda 3. Dalur 4. Akbastau (Karatau) 5. Zarechnoe

Planned facilities 6. Elkon 7. Gornoe 8. Olovskaya

Exploration ventures and prospective projects 9. Mongolia 10. Canada 11. Russia

12. Namibia 13. Armenia 14. Ukraine

Growth Results 2006-2008

• Number of subsidiaries and projects increased from 4 to 18

• 16% growth of uranium output in two years • 4-fold growth of uranium resources • 16 uranium deposits licensed • New joint ventures set up to mine, drill and explore for uranium in Russia and abroad, new management and service companies in operation

Vitim Uranium Ore District Khiagda Ore Field: Koretkonde



Istochnoe Vershinnoe


Khiagda Teyrahskoe

Baunt Region, Buryatia, Russia 190 km from the city of Chita Deposits Type – “sandstone” in paleochannels Include 8 uranium ore deposits U Reserves: 32 215 t (C1+C2) U Resources: 15 325 t (P1) U Resources Expansion Potential: 100 thou. tU Ore grade: 0,05 % Mining method: acid ISL Planned U mine capacity 2000 tU/y Cost of production: under $40 p/lb

Elkon: World’s Largest New Planned Uranium Production Center Elkon Uranium Field Elkon Elkon Plateau Severnaya Interesnaya

Neprohodimoe Druzhnoe Kurung

• • • • • • •

• •


1 - Mesozoic intrusions; 2 - Cambrian platform carbonate formations; 3 - Pre-Cambrian metamorphites and granitoids; 4 – Blastomylonites 5 - Revived old fractures; 6 - Mesozoic tectonic zones; 7 - Uranium Deposits

• • • •

Elkon district Deposits - Elkon Ore Field In-Situ U resources - 344 thou. t Au Reserves – 140 t Ore grade - 0,146% U, 0,84 g/t Au Mining Method – Underground Current status - Projected

Plant capacity Initially 2.2 Mtpa, processing ore from Elkon Plateau and Kurung, Potential to expand to 4.5 Mtpa to process ore from all 5 mines

Plant recovery Uranium 89.6% Gold 43.4% Silver 35.8% Molybdenum 38.9% (from Druzhnoye mine

Recoverable uranium resources in Elkon district amount to 5.3% of world known uranium resources, which makes it second biggest U deposit

Elkon: Current Status •Pre-feasibility study by SRK Consulting to be complete in late April, 2009 •3D modeling complete •DCF modeling complete •Expertise of Russian and international research consultancies fully employed • New technical solutions developed to lower cost of production to less than $100 per kilo U •Resource classification to JORC and Normative N43-101 to be complete by end of spring 2009

Preliminary estimates indicate definite benefits for potential investors

1=Elkon mine 2=Elkon Plateau mine 3=Kurung mine 4=Neprokhodimoye mine 5=Druzhnoye mine 6=Processing plant

World economic & financial crunch: How U miners are affected Uranium prices

U Miners Share Price

World economic & financial crunch: How U miners are affected (cont.) Primary Uranium Producers • Ramping up uranium production • Expanding existing mines and mills, acquisition of new facilities • Acquisition of exploration companies with attractive projects • Establishing joint ventures in exploration for and mining of uranium

Planned and Junior Uranium Producers • Maintaining or scaling down uranium production plans • Lack of financial resources for project development/ Raising capital becoming increasingly difficult • Plans to build new mines delayed or abandoned

ARMZ Weathering the Crisis Expanding Resource Base Uranium Production

•Supported by Ministry of Natural Resources and Federal Agency of Resources & Mining, ARMZ implements a program for Russia’s uranium resource base expansion •Exploration and resource base expansion at operational mines and facilities under construction in Russia and Kazakhstan: Priargunsky, Dalur, Khiagda, Akbastau, and Karatau

Acquisitions ARMZ purchased assets from Effective Energy N.V. (Netherlands) to become world’s second largest uranium miner in terms of uranium reserves

•Exploration for uranium within existing tenements of planned facilities, as per license agreements: Elkon, Gornoe, Olovskaya •Exploration for uranium deposits in Africa: «SWA Uranium Mines» Joint Venture, Namibia

In the face of the world economic and financial crisis, ARMZ has expanded its plans rather than curtailing them

ARMZ Competitive Advantages in Times of Crisis Demand for uranium guaranteed by Stateowned Rosatom

Direct financial aid from the State budget

ARMZ Advantages

Debt financing completely backed up by assets

ARMZ Crisis Management • • •

Slashing production and management expenditure at mining facilities Increasing production efficiency through use of advanced machinery, materials, and technologies, deployment of modern mining equipment Cutting production costs, bringing up product competitiveness

Asia and the Pacific: Uranium Market

Power Generation by Nuclear

Uranium Requirements

Uranium Production Volume

• 109 out of world’s 439 operating nuclear reactors • Overall capacity of 79,6 GWe • Overall nuclear capacity to increase to 190,4 GWe by 2030 (IAEA)

•Current: 15 thou tU in 2008 •Forecast: increase to 40 thou tU in 2030

•Current: 900 tU in 2008 •Forecast: increase to 2 000 tU in 2030

Asia and the Pacific: U Demand & Supply

Huge misbalance – to reach 95% in the foreseeable future - between demand for U by nuclear reactors and supply of locally produced uranium

Uranium required in 2030 (F): 40 thou tU

Uranium required in 2008: 15 thou tU

Locally sourced 900 tU

Locally sourced 2000 tU

Russian Nuclear in Asia and the Pacific •Building 2 nuclear reactors of 1000 MWe each •Agreement to build 4 additional NPRs at Kudankulam nuclear power station •Agreement to build nuclear power stations of Russian design at new sites •Protocol to supply nuclear fuel to nuclear power stations in India (2 thou tU over 5 years for $780 million) •Tianwan Phase 1 constructed by Russia in commercial operation •Tianwan Phase 2 construction planned •Construction of Uranium Enrichment Facility Phase 4, deliveries of Russian enriched uranium product worth $1,5 billion •Negotiations re. agreement on cooperation in peaceful nuclear energy •Atomic energy deal between Atomenergoprom and Toshiba Corp. re construction of joint uranium enrichment plants in Japan and other Asian countries

Why Asia Mining? • ARMZ introductions to Asia and the Pacific mining business community • Sharing info re. ARMZ uranium projects • Highlighting importance of nuclear and uranium for Asia and the Pacific • Getting in contact with potential partners in uranium mining and exploration: miners, consultants, fund managers, investors


ARMZ Uranium Holding Co.  

An emerging Asia leader in uranium mining

Read more
Read more
Similar to
Popular now
Just for you