The Japan Bank for International Cooperation (JBIC) has signed a loan agreement of US$198.8mn for developing uranium deposits in Kazakhstan.

The loan, co-financed with private financial institutions, is to support a uranium mine development and production project in the province of Kyzylorda. The Kyzylkum Limited Liability Partnership (LLP) will develop uranium deposits in the Kharassan-1 mining area and Baiken-U will develop uranium deposits in the Kharassan-2 mining area.

This project is undertaken by Kazatomprom, a state-owned atomic company, as well as the Japanese companies; Marubeni, Tokyo Electric Power, and Chuba Electric Power. A total of 5,000 MTU uranium concentrate is to be produced annually from the two deposits, of which the participating Japanese companies have the right to obtain up to 2,000 MTU.

Uranium is a fuel for nuclear power generation, through which the Japanese government aims to produce up to 30-40% of the country’s power, as a long-term strategy to secure a stable energy supply and as a measure against global warming.

This long-term supply is critical for Japan, which currently relies on uranium imports, the price of which has been rising rapidly. It is vital therefore, for Japan to improve relations with Kazakhstan, a key producer and supplier of uranium, in order to broaden its supply sources. The JBIC financing will help achieve this.

Since the memorandum of understanding signed last year with Kazatomprom on comprehensive strategic partnership, JBIC has held close discussions on various issues including this loan. As Japan’s official external financing institution, JBIC will continue to make constructive efforts, such as project structuring and risk taking, to support the projects – thus contributing to a steady supply of energy resources.