Uranium mining plays a significant role in the nuclear energy chain—and in Namibia, the Trekkopje uranium mine and desalination plant represent the largest direct foreign investment ever made in Namibia.
With a market share of about 15 per cent and active in four of the world’s five richest uranium producing countries, AREVA is the world’s largest uranium producer. The extensive mining interests of AREVA cover exploration,extraction and the processing of uranium ore, as well as the reclamation of sites after production has finished.
But mining is emphatically not all that this company is about. “The mining operations of AREVA have to be seen within a global context,” explained Enrico Barbaglia, AREVA’s vice president of mining in Southern Africa. “Our mining operations in Southern Africa are part of a much bigger nuclear energy chain, or even more precisely, part of a larger energy production chain.”
The company has a small interest in gold, but uranium is what really matters. This is because uranium feeds AREVA’s nuclear business further down the line. AREVA is the only company with a presence in every industrial activity linked to nuclear energy: mining, chemistry, enrichment, combustibles, services, engineering, nuclear propulsion and reactors, treatment, recycling, stabilization, and dismantling.
After the Mining Business Group has done its work, the front end of the group converts and enriches the uranium and designs the fuel for the nuclear reactors. Other business units deal with reactor design and construction and then there are the activities needed to commission and maintain the reactors. At the back end of the process is de-commissioning and clean-up. Lastly, there is the renewable energy unit that develops wind energy, bio energy, solar and hydrogen power solutions.
This level of vertical integration and involvement in the full energy production cycle has shaped the mining group. “Unlike some mining companies who are only interested in extracting commodities at the lowest possible cost within the most immediate time frame, we take a much longer-term view. What matters most of all is that we can guarantee stability and security of supply throughout the lifetime of the reactors that are commissioned further down the line,” he said.
In response to global concerns about dwindling supplies of fossil fuels and their effect on the environment, as well as geo-political uncertainty, the nuclear industry is enjoying a renaissance. AREVA is circa 90 per cent owned by the French government and almost 80 per cent of France’s domestic power supply is generated through its 58 nuclear reactors. Now, other energy-hungry countries are considering following suit and sharp spikes are anticipated in demand when a number of long-term nuclear projects finally come to fruition over the next decade. Demand is nothing if not buoyant. However, the market for uranium is highly complex. “There is a producer and a user in an ideal world—intermediaries inevitably have an interest in manipulating the market to their own ends,” said Barbaglia.
Many new entrants are creating the illusion that a flood of uranium will hit the market at prices not worth taking out licences for, according to Barbaglia. The hype which surrounds the oil market, he said, pales by comparison. “Hundreds of feasibility studies have been completed, but the vast majority will never see a gram of uranium extracted. Many junior players are more interested in talking up the market than in actual execution.”
For AREVA as a full cycle company, price is only one facet of the equation. Security of supply is everything and this means that geographical diversification is fundamental. As such, AREVA often operates in diverse countries with varying socio-political as well as cultural contexts. However, AREVA’s differentiation allows for the group to adequately cover for both the technical and political difficulties it may face in the various countries in which it operates.
AREVA Resources Southern Africa’s relationship with the Namibian government is an example of where AREVA is successfully partnering with the government and relevant stakeholders in the country in order to meet its business objectives as well as the country’s. “Namibia is a very reliable trading partner with transparent business practices and a very high degree of political stability. We know we can make long-term business plans, which is vital for a company like ours,” said Barbaglia.
In Namibia, AREVA has a large scale emerging uranium project called Trekkopje Mine, approximately 40 kilometres into the desert fromthe town of Swakopmund. The Trekkopje deposit is a shallow, high tonnage, low grade uranium deposit hosted by calcretised palaeochannels. When commissioned the mine will process 100,000 tonnes of crushed ore per dayto eventually produce 3,000 metric tons of uranium per year.Mining of the deposit's upper layers and then the uranium ore will be carried out in the traditional way: explosive detonations, extraction with shovels and transportation by truck to the primary plant. The mine is predicted to have alifespan in the region of 12 years.
Creating conditions of economic and environmental sustainability has a special relevance, Barbaglia stressed. “As a major industrial player with recognised expertise in the energy sector, it is our responsibility to establish and nurture positive relationships with the government and local institutions wherever we operate.”
For example, in April 2010 AREVA opened a desalination plant to serve the Trekkopje mine. It is a highly innovative project—the first of its kind in Southern Africa—with the capacity to produce 20 million cubic metres of potable water per annum. While featuring state-of-the-art technology with screen filtration, ultra filtration, reversed osmosis and chemical treatment, the plant will supply the Trekkopje mine with desalinated water taken from the Atlantic Ocean, thus preserving Namibia’s water resources. The water is delivered to Trekkopje through a 48 kilometre long pipeline supported by three pump stations. NamWater, Namibia’s state-owned water supplier, will be able to buy the excess water to supply other mines and companies operating in the Erongo region.
“Bringing our plans in Namibia to fruition is a major part of our strategy for the future,” concluded Barbaglia. “We have formed an exploration joint venture with the Namibian government which is working extremely well and we expect to undertake many other projects together.” www.areva.com
