Uranium price will rebound: analysts (Part 4)

The Paris-based Nuclear Energy Agency (NEA), part of the Organization of Economic Cooperation and Development (OECD), publishes an annual report on uranium. Known as the Red Book, the latest edition is entitled Uranium 2007: Resources, Production and Demand, and has data that was current on January 2007.

The Red Book estimates that reasonably assured resources of uranium which can be recovered at a cost of up to US$50 per lb. uranium oxide are about 3.3 million tonnes uranium, while inferred resources which can be recovered at this cost are about 2.1 million tonnes, for total identified resources of about 5.5 million tonnes uranium. The Red Book estimates that there is an additional 2.8 million tonnes of undiscovered uranium. Assuming that the entire amount will be discovered, this brings world resources to 8.3 million tonnes uranium which can be recovered at a cost of up to $50 per lb. uranium oxide.

Not included in these resources is uranium found in phosphates, estimated at between 7-22 million tonnes, which can be economically recovered only at high uranium prices. There is also an estimated 4 billion tonnes of uranium in seawater.

The Red Book reports that uranium consumption for power generation was about 67,000 tonnes uranium in 2006, while mine production was about 40,000 tonnes, with the shortfall being met from stockpiles and dismantled nuclear weapons. On the back of new reactor construction, consumption is projected to rise gradually over the next 22 years to 94,000-122,000 tonnes uranium per year in 2030, while mine production will reach 83,000-118,000 tonnes uranium per year in 2030.

The Red Book concludes that the identified resource base is sufficient for at least 100 years of reactor demand, while the entire conventional resource base will last 300 years. And this could grow even further. The Red Book says: “Given the limited maturity and geographical coverage of uranium exploration worldwide, there is considerable potential for discovery of new resources of economic interest.” Improvements in reactor technology and the fuel cycle could further extend the availability of nuclear energy to thousands of years.