In 2006 JV Betpak Dala mined a thousand tons of uranium at the Akdala uranium mine for the first time in the international mine development practice by using the in-situ leaching method. Today the enterprise is going over its threshold of 2,000 tons at its second mine South Inkai. The discoverer of three uranium deposits and Chief Geologist at JV Betpak Dala Yuri Alexandrov is sure that the company is capable of gaining new impressive results which will be part of the uranium industry development history in Kazakhstan.
Yuri Sergeyevich, could you tell us in what way the company is developing and what major stages of its development it has passed?
I would like to start with the fact that the Akdala uranium deposit, located in Sozaksky region of the South Kazakhstan Oblast, was discovered as early as in the Soviet times. At that time I was working at Volkovgeologiya and taking a direct part in supplementary exploration of the said deposit. In 2001 at this deposit, Kazatomprom launched into test production a same name mine. Within the following three years Volkovgeology was carrying out development work and supplementary exploration, which proved the possibility of mining up to 1,000 tons of uranium. Following that the company had made a final estimate of the reserves totaling some 16 thousand tons, and the state committee for reserves have approved that figure.
JV Betpak Dala LLC was set up in March of 2004 between the Canadian company Uranium One (70%) and NAC Kazatomprom (30%); the latter assigned to us the right of commercial production and further exploration of Akdala. Inearly 2005 we started working on our own. A fact that is worthy of mentioning is that originally the annual production at the mine had been planned at the level of 300 tons, while in the assignment of the rights the parties entered into a supplementary agreement providing for the annual output increase of to 1,000 tons that was a significant difference. To achieve these figures, we have carried out expansion and modernization of the mining facilities and built new facilities and infrastructure. We did this mainly at the expense of own funds, received from the selling of the finished products. 726 tons of uranium was produced at the mine in 2005, while in 2006 the company mined its first thousand tons, i.e. we achieved the design capacity that was provided for in the Kazakhstan state program of the uranium industry development until 2030. Of course, today other enterprises have achieved this level as well. However, at that moment we were the only company in the world that was mining uranium using the in-situ leachingmethod and gained that result at one mine alone. Now at Akdala we extract 1,020–1,030 tons of uranium a year that is in line with the contract until 2020.
Apart of the Akdala uranium deposit, in September of 2005 our company was vested the right to carry out mining operations at Site #4 of the Inkai deposit located in the Shu-Sarysukskaya uranium ore province. Here we are developing the South Inkai uranium mine with a target production of 2,000 tons of uranium a year. Considering that, in the current year our company is planning to achieve the output of 3,000 tons of uranium a year.
Following the recent corporate events, I would like to mention the fact that in 2010 the Russian holding company Atomredmetzoloto bought a controlling stake of Uranium One, one of our shareholders. So, we can say now that we are the Kazakhstan-Canadian-Russian company.
At what stage of development are the mining facilities of the company?
The mining infrastructure at Akdala is built already. At the first stage, we only had commercial stripping at the mine, i.e. the product of primary processing, which later passed through the stage of transformation into a chemical concentrate of natural uranium at the Taukentsky mining and chemical plant and Stepnoye mine group. Only then the product was sent to the Stepnogorsk mining and chemical complex for production of uranium oxide concentrate from it. In 2009 we launched a new production site, where we produced the first batch of uranium peroxide, for the first time among the Kazatomprom’s enterprises. This technology allows considerable fund-saving to produce uranium concentrate directly at the place where it is mined. Launching of the “yellow cake” production allowed us to considerably reduce manpower and energy resources, as well as to reduce the cost of the product and to increase economic efficiency of the venture. Last year we were examining the question of setting chambers for production of uranium oxide concentrate directly at the mine. However, after making calculations we decided that it would be more beneficial to set the extra equipment at South Inkai by concentrating all the technological process in one place. Moreover, the distance between the mines is just a hundred kilometers, and to transport the “yellow cake” from one mine to the other is not a problem.
By the time of assignment of the right to our company from Kazatomprom, Akdala uranium mine was an effectively operating enterprise: we had a good staff and experience of work. At South Inkai we had to start from point zero. In 2005 the site was a bare area in the steppes without any infrastructure. Betpak Dala hired employees and carried out design and exploration. In November of 2007 we completed construction and launched the mine into test production. Believe me in my 30-year experience in the uranium industry – that was the record shortest period of time. During the test production phase, we extracted 480 tons of uranium. In 2008 our partner Volkovgeology accomplished the first stage of exploration for us, and we estimated the uranium reserves at 32 thousand tons, and so was approved. The contract concluded for a 20-year period provides for bringing the approved reserves to 40 thousand tons. We will proceed with exploration, and I believe we will be able to gain the target result specified in the contract upon the end of 2011.
830 tons of uranium was mined in 2009 at South Inkai, and in the last year we made a powerful breakthrough, reaching the level of 1,700 tons. At the current moment 1,000 production boreholes are operating at the mine, while by the end of 2011 we are planning to bring their number to 1,500 units and bring the mine to the production of 2,000 tons of the product as per the contract.
Now we do not send “yellow cake” for processing. We set the chambers at the mine where we produce the uranium oxide concentrate. Then we pack it and send for sale. I mentioned before that we are currently expanding the production facilities so that we will be able to process the “yellow cake” from Akdala here. For this, two extra chambers will be installed at South Inkai. Relevant investments are already included into the budget. I would like to stress that practically all equipment engaged in operation at our production facilities, except for the chambers and pumping units, is manufactured in Kazakhstan.
On February 14, 2006 work started in our company to introduce the management systems for compliance with the international standards ISO 9001:2000, OHSAS 18001:1999 and ISO 14001:2004. Owing to this, as far back as three years ago, the safety of production at our mines had been brought to the international standards level.
Now, the products of Betpak Dala are sold under the PSA; 30% of it is sold by Kazatomprom, and the remaining part is exported mainly to Canada, USA, France and China.
What kind of staff is hired by Betpak Dala? How do you solve the problem of shortage in highly-skilled professionals?
Here I would like to mention that only three representatives of the Canadian shareholder work in our company; they fulfill only controlling and supervisory functions. The greater part of the personnel, 270 people, work at Akdala, 400 people at South Inkai, and 97 in the headquarters in Almaty – all of them are the nationals of Kazakhstan.
In fact, concerning the professionals in geology, for example, the reality is so that today the sector of geology is experiencing a lack of highly-skilled professionals in this area worldwide. Some time ago, in the period of uranium price fall, the demand for the uranium industry specialists had reduced; the training of this kind of specialists stopped. So, a sort of an age gap has taken place. As a result, now not only in Kazakhstan, but in Russia, Australia and America as well, mainly people of pre-retired age, or the youth which recently graduated from the institutions of higher education work in the uranium industry. For example, in our geological service 40% of the employees have the record of service of one to three years.
Still, Betpak Dala managed to solve this problem by organizing training courses for personnel directly at the production. Every summer we organize probation for 5–7 students who study for geologists, whom we then give jobs after they graduate. At the expense of the company we send a part of the employees to raise their professional skills to the domestic institutions of higher education and Kazakhstan Nuclear University. In the future, we have plans for cooperation with the Tomsk University, which recently began training specialists in the uranium industry.
I would add that the Soviet school of uranium geology, exploration and production is no worse than that in the West, and in some aspects it even outstrips it. I have been to South Africa and Australia and saw that they do not use any special or novel methods, and our own experience and applied technologies are even better in many respects. We have many specialists in our company that have extensive knowledge in their area, and they share their unique experience with the younger specialists.
How do you characterize the future of Betpak Dala and the domestic uranium industry in general?
The uranium industry in Kazakhstan, I am sure, will be developing stably, and the demand for its products will not reduce within the next decade. This is because the times when coal and black oil are burned for energy production will not be forever, i.e. there is no real alternative to the nuclear power. The recession did not affect our industry. Yes, there was a slight price fall, not long in the period, but now the prices are up and even exceed the pre-recession’s level.
Concerning JV Betpak Dala, among our main goals is to reach the target output at South Inkai and to fully transfer to its own production of uranium oxide concentrate. Recently Kazatomprom worked out a program of development of rare-earth elements production. As one of the first steps in this direction, our company in collaboration with the Institute of High Technologies is carrying out test production operations for associated production of rhenium at Akdala, where this rare-earth element occurs in commercial solutions in a relatively good concentration. Currently, we are developing the feasibility study, by results of which we will make a decision as to the expediency of investments in construction of a full-featured industrial unit. Rhenium, applied in the space industry, plane-building, radio electronics and radio engineering, is in high and steady demand in the external markets. Speaking of the prospects of uranium extraction, in our estimates, the uranium resources of South Inkai are 68 thousand tons, but these figure should be proved first. So, the company has the possibilities of its further development in this direction.