Uzbek-Chinese uranium producing joint venture increases authorized capital

Business Materials 18 March 2013 17:05 (UTC +04:00)

Uzbekistan, Tashkent, March 18 / Trend, D. Azizov /

The Government of Uzbekistan has instructed the State Committee for Geology and Mineral Resources (Goskomgeo) to make changes to the constituent documents of Uzbek-Chinese "Uz-China Uran" ltd. JV by August 1, 2013 due to an increase of its authorized capital by almost half - from $4.6 to $8.576 million, according to a decision of the Cabinet of Ministers of Uzbekistan, published Monday in the domestic media.

According to the document, the share of CGNPC URC (CGNPC Uranium Resources Co. - a sole subsidiary of China Guangdong Nuclear Power Holding Co.Ltd.) in the joint venture is 50 percent and is formed by monetary assets and equipment.

The share of the Uzbek side, represented by Goskomgeo, also constitutes 50 percent and is formed by geological, geophysical and other information obtained during the previous uranium exploration works at perspective Bozraus and Mesheti areas in Navoi province.

According to a source in Goskomgeo, in January of this year, the Government issued a decree on "measures expanding the activities of" Uz-China Uran".

The source did not say what was stipulated by the document, but mentioned the increase of the authorized capital due to the expansion of the joint venture.

China's CGNPC URC and Goskomgeo,Uzbekistan, established "Uz-China Uran" JV in August 2009 on parity basis with an authorized capital of $ 4.6 million for exploration for uranium in Boztau area, Navoi province, that is potentially reach with black shale uranium deposits. Uz-China Uran is the first joint venture created for development of uranium fields in Uzbekistan.

In 2010-2011, the joint venture carried out geological exploration in the contract area. Several uranium deposits with undisclosed parameters were found out on the results of works.

According to Goskomgeo, forecasted uranium reserves in Boztau area are 5.5 thousand tons. All of the ore is black shale.

In 2011 the parties signed a framework agreement that determined the expansion of activities of "Uz-China Uran" JV on development of black shale deposits of "Dzhantuar", "Rudnoe" and "Koscheka", Navoi province.

Earlier, the administration of Goskomgeo announced that "Uz-China Uran" JV is going to start the development of black shale uranium deposits in central Kyzyl Kum by 2013.The technology of separate extraction of uranium and vanadium during development of uranium deposits of black shale type, which will constitute the resource base joint venture, should be ready by that time.

According to conducted researches, the joint venture will begin construction of an extraction complex and start uranium extraction in the second half of 2014.

Under the terms of the joint venture, the Chinese company will have preferential rights to the purchase of the output of Uz-China Uran JV at world prices. There is no official information that the joint venture has already received a license for exploration of the above-mentioned fields.
It was assumed that in the medium term Uz-China Uran will focus on developing black shale deposits, as deposits of sandstone type remain a strategic base of Navoi Mining and Metallurgical Combine (NMMC).

According to Goskomgeo, explored and estimated uranium reserves constitute 185.8 million tons, of which 138.8 thousand tons are uranium deposits of sandstone type, and 47,000 tons - black shale type.

NMMC is a monopolistic uranium extractor, enricher and exporter in Uzbekistan. Currently, extraction of uranium by in-situ leaching (ISL) method is carried out by three enterprises of NMMC. Processing of uranium is conducted at GMZ-1 hydrometallurgical plant in Navoi.