russia nuclear industry optimistic

LONDON, October 24, 2011 - PRNewswire

The global nuclear industry remains buoyant despite the Fukushima disaster, and Russia is looking to Western partners as it expands its nuclear investments both at home and abroad, Sergei Kirienko, the former Prime Minister of Russia and director general of Russian state nuclear corporation Rosatom, told investors today in London.

"Our goal is to open up the sector to broad, free dialogue with the Western investment community," Mr Kirienko told an audience at The Savoy hotel at an event arranged by Canaccord, the investment bank. "We took a vital step towards this goal with our purchase of a majority stake in Uranium One (TSX:UUU)."

"We set out to win the trust of shareholders and show the global investment community that a Russian state company knows and can play by the 'rules of the game' for global public companies," Mr Kirienko said. "The past year and a half have shown that we are succeeding."

Global demand for nuclear power and for Russian nuclear power plants (NPPs) has remained strong despite the Fukushima disaster in March. All six NPP construction contracts signed by Rosatom in 2010 and 2011 remain in place. Rosatom has also signed agreements with China and Slovakia to develop existing nuclear infrastructure, and a "road map" with India for its civilian nuclear programme. "The Fukushima factor has had almost no effect on global demand for nuclear power," Mr Kirienko said. "Most countries do not plan to replace their current nuclear capacity with other types of generation in the foreseeable future," noting that nuclear is among the safest, greenest and most economical sources of power.

"Only a very few countries with small nuclear capacity can afford to reject nuclear plants in favour of energy from fossil fuels or alternative sources," Mr Kirienko said.

The uranium market has also remained relatively stable, Mr Kirienko said. But he said that prices, which have stabilised at around US$50 per pound after falling to $40 in the immediate aftermath of the disaster, need to rise to ensure that supply remains healthy: "In our opinion, to ensure enough supply to satisfy growing demand over the next decade, the price needs to be stable at around US$70 or US$80."

Rosatom and ARMZ are now looking to strengthen their international presence further, using Uranium One as a spearhead. "The acquisition of Mantra Resources in Tanzania was the first significant step in diversifying Uranium One's production outside Kazakhstan," Mr Kirienko said. "In our opinion, southern Africa is a future growth 'hot spot' for the uranium sector. They have submitted a mine plan for Extract Resources' South Rossing deposit in Namibia, saying they would fund the development.

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