Marubeni Corporation (Marubeni), The Tokyo Electric Power Company,
Incorporated (TEPCO) and Chubu Electric Power Co., Inc. (Chubu)
(hereinafter, the COMPANIES) have decided to participate in a
new uranium mine development and production project promoted by
Kazatomprom (hereinafter, KAP), a state-owned nuclear fuel
enterprise in the Republic of Kazakhstan. The COMPANIES have
acquired an indirect ownership interest in the project companies
of Kyzylkum LLP and Baiken-U LLP through an investment in a
KAP-related company which has ownership and control over Kyzylkum
LLP and Baiken-U LLP (current investment ratio: Marubeni 60%,
TEPCO 30%, Chubu 10%). Tohoku Electric Power Co. Inc. also has
decided to participate in the project, and is planning to purchase
a partial indirect ownership interest in the project companies from
the COMPANIES.
This project entails the development of the Kharassan uranium mine
in southern Kazakhstan (Kyzylkum LLP is developing the Kharassan-1
uranium deposit and Baiken-U LLP is developing the Kharassan-2 uranium
deposit). The project is targeting the start of test production from
around 2007, with a projected ramp to a full annual production of
approximately 5,000MTU (combined) by around 2014 and continued
production until around 2050. The combined potential uranium production
could be over 160,000MTU (*1). The COMPANIES have the right to
obtain up to an aggregate annual quantity of 2,000MTU of the uranium
concentrate produced from the two deposits.
Kazakhstan has the world´s second largest uranium reserve. In August
2006, then-Prime Minister Koizumi, who became the first Japanese Prime
Minister to visit Kazakhstan, and Kazakhstan President Nazarbayev issued
a joint statement extolling the "successful materialization of
significant projects in the area of exploration, development and
production of uranium resources". This joint statement greatly contributed
to the participation of the COMPANIES in this project.
The Japanese government and the Kazakhstan government plan to confirm
their cooperative relationship for the smooth facilitation of this project
at the government-private joint mission led by Minister Amari of the
Ministry of Economy, Trade and Industry which will be held at the end
of this month.
As an alternative energy to fossil fuel as well as an effective
counter-measure against global warming, Marubeni has been promoting
peaceful use of nuclear energy as one of its vital business areas.
Marubeni is participating in this project from the viewpoint of
expanding Marubeni´s nuclear fuel cycle value chain as well as
contributing to energy security in Japan.
From the perspective of the stability and economy of nuclear power
generation, TEPCO considers it an important task to secure a stable
and long-term supply of uranium. Up until now TEPCO has entered into
long-term uranium supply contracts with uranium suppliers in Canada
and Australia, but it views its participation in this project as a
way to further diversify and stabilize its long-term uranium supply.
Chubu similarly considers it an important task to secure a stable
and long-term supply of uranium from the perspective of the stability
and economy of nuclear power generation, and views its participation
in this project as a way to further diversify and stabilize its
long-term uranium supply.
A part of the funds necessary for the development of this project is
expected to be obtained from the Japan Bank for International Cooperation
(JBIC) through its natural resources financing.
As for the investment by the COMPANIES to participate in the project,
overseas investment insurance from Nippon Export and Investment Insurance
(NEXI) has been obtained.
(*1) The potential uranium production is an estimate, and does not
represent a proven recoverable reserve.
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