Russian Concerns at Uranium Deal
Russian Concerns at Uranium Deal
Russia need not worry that it will lose out on Kazak uranium if Kazatomprom becomes a major shareholder in its US competitor Westinghouse Electric Company, say NBCentralAsia analysts.
On July 9, it was confirmed that the Kazak state company Kazatomprom has been holding ongoing talks with Japan’s Toshiba Corporation to buy a ten per cent share in the nuclear reactor specialist, Westinghouse Electric Company.
If the deal goes ahead, Kazatomprom will become the third largest shareholder in the US company, and will supply uranium to Toshiba’s nuclear power stations in exchange for fresh nuclear technology.
Westinghouse is one of Russia’s biggest competitors and Russian observers say that the deal could not only disrupt uranium supplies to Russia but could also push up prices.
Kazakstan holds the second largest uranium reserves worldwide and plans to double extraction to 15,000 tonnes by 2010.
Russia extracts just over 3,000 tonnes of Kazak uranium a year but requires around 17,000 tonnes to meet its energy needs.
According to Kazatomprom, the world uranium shortage could reach 16,000 tonnes by 2012 and experts predict a stable rise in nuclear fuel prices.
NBCentralAsia analysts say that even though the uranium market will change if the Kazatomprom deal goes ahead, Russia’s fears of soaring prices and disrupted supplies are unfounded. Kazakstan and Russia have signed numerous binding agreements to cooperate on nuclear energy area and both sides have offered political guarantees.
“I think that all this fuss is rather a precaution and [Kazakstan’s] strategic partnership will remain with Russia,” said NBCentralAsia analyst Petr Svoik. It would be far too risky for Kazakstan to divert from the path it has carved with Russia, he adds.
Russia is not particularly concerned with the prospect of a dip in uranium supplies, Svoik suggests, but instead is worried that the deal will foil its plans to monopolise nuclear energy production in the region.
Russia’s single holding company for the nuclear industry, Atomenergoprom, has plans to establish a closed technology cycle for the entire nuclear energy process, from extraction through to power station construction.
Westinghouse would give Kazakstan access to the most innovative nuclear technology which could take Atomenergoprom out of the loop and jeopardise its plans.
NBCentralAsia economic observer Ivan Voytsehovsky says that Russia is panic-mongering and too much importance has been attached to the Kazatomprom deal.
“Ten per cent of shares are not even a blocking stock, let alone a control package,” he said. “These shares can be bought by anyone, so this purchase should not be taken so seriously.”
(News Briefing Central Asia draws comment and analysis from a broad range of political observers across the region.)
On July 9, it was confirmed that the Kazak state company Kazatomprom has been holding ongoing talks with Japan’s Toshiba Corporation to buy a ten per cent share in the nuclear reactor specialist, Westinghouse Electric Company.
If the deal goes ahead, Kazatomprom will become the third largest shareholder in the US company, and will supply uranium to Toshiba’s nuclear power stations in exchange for fresh nuclear technology.
Westinghouse is one of Russia’s biggest competitors and Russian observers say that the deal could not only disrupt uranium supplies to Russia but could also push up prices.
Kazakstan holds the second largest uranium reserves worldwide and plans to double extraction to 15,000 tonnes by 2010.
Russia extracts just over 3,000 tonnes of Kazak uranium a year but requires around 17,000 tonnes to meet its energy needs.
According to Kazatomprom, the world uranium shortage could reach 16,000 tonnes by 2012 and experts predict a stable rise in nuclear fuel prices.
NBCentralAsia analysts say that even though the uranium market will change if the Kazatomprom deal goes ahead, Russia’s fears of soaring prices and disrupted supplies are unfounded. Kazakstan and Russia have signed numerous binding agreements to cooperate on nuclear energy area and both sides have offered political guarantees.
“I think that all this fuss is rather a precaution and [Kazakstan’s] strategic partnership will remain with Russia,” said NBCentralAsia analyst Petr Svoik. It would be far too risky for Kazakstan to divert from the path it has carved with Russia, he adds.
Russia is not particularly concerned with the prospect of a dip in uranium supplies, Svoik suggests, but instead is worried that the deal will foil its plans to monopolise nuclear energy production in the region.
Russia’s single holding company for the nuclear industry, Atomenergoprom, has plans to establish a closed technology cycle for the entire nuclear energy process, from extraction through to power station construction.
Westinghouse would give Kazakstan access to the most innovative nuclear technology which could take Atomenergoprom out of the loop and jeopardise its plans.
NBCentralAsia economic observer Ivan Voytsehovsky says that Russia is panic-mongering and too much importance has been attached to the Kazatomprom deal.
“Ten per cent of shares are not even a blocking stock, let alone a control package,” he said. “These shares can be bought by anyone, so this purchase should not be taken so seriously.”
(News Briefing Central Asia draws comment and analysis from a broad range of political observers across the region.)
