Kazakhstan: A new source of uranium for AREVA (COGEMA)

Kazakhstan is one of the ten largest countries in the world and number two in terms of world uranium resources. AREVA (COGEMA) has made a significant investment in uranium mining operations in Kazakhstan. The creation of KATCO, a joint venture with Kazatomprom the state owned corporation responsible for uranium production in Kazakhstan, will enable AREVA to increase and diversify its uranium supplies. Why Kazakhstan? Kazakhstan hosts 16% of the world's total uranium reserves. The large orebodies are amenable to low cost In Situ Leaching (ISL) extraction. Joint venture partner Kazatomprom possesses local know how and experience in ISL mining for uranium. The country has a high potential for industrial development and opportunities exist for foreign companies to create joint ventures. Kazakhstan has the best risk rating for a central Asia country. The uranium potential of Kazakhstan lies within six uranium provinces. Four of them correspond to past production or dormant resources. The Chu-Saryssu and Syr-Darya basins found in the southern part of the country are two large uranium districts with abundant resources. KATCO's project is located in the south of Kazakhstan about 200km northwest of Shymkent and approximately 800km west of Almaty. KATCO 's reserves are hosted by the Muyunkum Deposit, which is found in the uranium-rich Chu-Saryssu Basin, located 50km north of of the village of Taukent. The Muyunkum Deposit has a length of 75km and width of 30km. The depth of the mineralized horizons vary from 220m at the north and 520m at the south. Three ore bodies have been identified: Muyunkum South, Muyunkum Centre and Muyunkum North (Tortkuduk). At a regional scale, uranium is controlled by four major roll-front systems. Mineralization is hosted by fine to medium grained sandstones of the Uyuk and Upper Kanjugan formations which are confined between clay layers. COGEMA began exploration in Kazakhstan in 1994 and KATCO was formed in 1996 to explore and mine the Muyunkum Deposit. Upon completion of a pre-feasibility study, uranium extraction licences were granted by the State. KATCO constructed a pilot plant at Muyunkum South in 2000 and ISL operations commenced in 2001. The first yellowcake was produced from the pilot in 2002. Exploration by KATCO at Tortkuduk, located 45km to the north of Muyumkum South, began in 2002. A successful ISL test pilot plant was constructed the same year. Following the completion of a feasibility study of the Muyunkum Deposit in 2003 an agreement was signed early 2004 with Kazatomprom to launch KATCO into an industrial phase for the development of the Muyunkum Deposit. Construction of the Muyunkum South plant commenced late 2004 and is expected to be completed before the end of 2005. Two additional plants will be constructed at Tortkuduk in 2006 and 2007. Annual production is expected to reach 1500 tonnes of uranium by 2008