The devastating accident at the Fukushima nuclear plant in Japan in March 2011 triggered a global reassessment of nuclear power, radically reshaping and diminishing the industry, with reactors shut down and national bans brought in.
Yet, in what could be seen as an extreme volte-face, investment in the industry for the first time in many years is climbing. Driven in large part by decarbonisation targets meeting the reality of rising energy demand amid slow renewable energy roll out, the World Nuclear Association (WNA), perhaps unsurprisingly, is touting nuclear as the solution to securing future carbon-free electricity – but this time it is backed by financiers, countries and major companies such as Meta, Google and Amazon.
The trade body has set a target of tripling global nuclear energy capacity by 2050 in response to expected increased clean electricity demand from industry. The International Energy Agency projects that electricity consumption from data centres will more than double worldwide by 2030 to around 945 terawatt-hours (TWh), more than Japan’s consumption today. In the same time frame, it predicts global aggregate electricity demand, driven by electrification, could rise by 6,750TWh, equivalent to more than the combined demand from the US and EU today.
Yet, as nuclear falls back into favour, industry experts are warning of a uranium supply crunch in the West, driven by the war in Ukraine, Russian sanctions on uranium imports and the familiar story of China’s dominance over current supply.
“There is this fundamental worry in the market that the West needs more uranium,” says Bryn Windsor, senior analyst for Eurasia at PRISM Strategic Intelligence. “Kazakhstan, currently the world's biggest and cheapest producer, is sending a greater share of its uranium East, not West. What does that mean for the long-term outlook?”
It is a question on many stakeholders’ lips. Last year Kazakhstan supplied 38.1% of global uranium supply, followed by Canada and Australia. However, much of this goes to China ─ a ‘practical’ and ‘logical’ set-up, says Windsor, given the former Soviet Union country is bordered with China, and Russia.
“China is building around half of all [reactors] globally under construction, so they just buy, buy, buy, natural uranium,” says Windsor.
According to the International Atomic Energy Agency (IAEA), as of 22 April, there were 61 nuclear reactors under construction, with 28 of those located in China.
This dominance isn’t expected to change anytime soon; China has long-term supply contracts with Kazatomprom, the state miner which controls around 48% of the country’s total uranium production, but the quantities are unknown. Transporting uranium from Kazakhstan into Europe and North America is challenging due to sanctions on Russia creating pressure points, with alternative routes being more expensive.
Despite uranium supply increasing by an estimated 12.4% in 2024, according to GlobalData, only a modest 2.6% increase is expected this year, it notes, largely due to suspensions and production halts at major mines such as Kazakhstan’s Inkai deposit (GlobalData is Mining Technology's parent company).
The net effect has been a rise in uranium prices. In early 2024, the price of uranium rallied to $94 per pound (lb) but settled at $76.7/lb. Prior to this, prices had been suppressed to around $25/lb in 2019 due to stockpiles and the so-called Fukushima-effect stifling exploration efforts.
It is a trend some expect to stick around. “I have always maintained that in the future, [uranium] prices will continue to increase quite a bit from $70/lb to maybe $300–400/lb as mines get shut down and demand increases,” says Duane Parnham, executive chairman and CEO of Critical One Energy, which is developing a uranium mine in Namibia. “The available supply of uranium is going to be depleted,” he adds.
The mining market has responded by restarting uranium projects as well as increased investment in the sector.
The price boost has supported the revival of uranium mines in the US, Canada and Australia, including Cameco’s McArthur River and Key Lake projects in northern Saskatchewan, Canada, which were suspended due to low prices and difficult market conditions.
In addition, Paladin Energy completed the acquisition of Canadian uranium company Fission Uranium in December 2024. This strategic deal, valued at C$1.14bn ($821.64m), grants Paladin control over Fission's Patterson Lake South project in Saskatchewan.
In fact, the overall picture for exploration and mine development expenditure "has changed dramatically", according to the Uranium 2024: Resources, Production and Demand biennial report compiled by OECD Nuclear Energy Agency and the IAEA, also known as the ‘Red Book’. Annual expenditures, it notes, decreased to approximately $380m in 2020 from more than $1.5bn in the years prior to the downturn, recovered to $800m in 2022, and continue to increase.
Uranium exploration is globally focused on Canada, China, India, Kazakhstan, Mongolia, Namibia, Niger, Russia, Turkey, Ukraine (although affected by the ongoing conflict), Uzbekistan, the US and other countries, the report notes. However, given the sensitivity of data related to uranium, a full picture is at times difficult to obtain, it adds.
There are now several new mines under development in Kazakhstan, Canada and Australia, including Canada’s Rook I and Wheeler River, as well as Australia’s Mulga Rock and Dubbo Zirconia projects and BHP’s expansion of Olympic Dam.
Kazatomprom, the world’s largest producer of uranium, has secured exploration rights for new uranium deposits to bolster its resource base, also, including for the Vostochny block of the Zhalpak deposit, located in the Turkestan region. The miner is also exploring the opportunity to gain a foothold in the rare earth element space.
These renewed uranium exploration efforts could take years to bear fruit, however, with the average time frame from discovery to production being 16.5 years, according to some analysis. The WNA’s annual Nuclear Fuel Report notes that although immediate future demand is well known (near and medium term), longer-term sources of primary uranium production is much less so.
In the past Canada-based Cameco and France’s Orano had sought shares of mines in Kazakhstan to shore up supply, but Windsor says this is now very unlikely, with the country having both technology and expertise that it needs.
“It will be more about how Western countries manage their relationship with the state-owned miner,” he says.
This growing predicament around future supply is not lost on the US, which imported around 99% of the triuranium octoxide it used in 2023 and where much of the spending for new data centres is concentrated, doubling in the past two years alone.
The metal was recently designated a critical mineral, and as such covered in a March executive order by President Trump to slash regulation around production. Uranium was notably absent from his flurry of tariffs. Under the previous Biden administration $2.7bn was provided to build-out uranium enrichment capacity in the country.
Mining engineer Philip Duah believes these recent moves are encouraging, even more so considering they are bipartisan.
“A bipartisan consensus has emerged at both federal and state levels to strengthen nuclear energy development and uranium production,” he says.
Although uranium exploration is under way in several states, the fact remains that the US holds only around 1% of estimated reserves. This is perhaps why US Energy Secretary Chris Wright said in February he "would love to" see Australia supplying uranium for nuclear power.
Australia has the largest estimated share of uranium globally at 6.1 million tonnes (mt) of total recoverable resources. Yet the scheduled closure of the Four Mile mine in 2029 is projected to significantly impact Australian uranium production. Consequently, GlobalData predicts output is expected to decline by 8.3% from 7,200 tonnes (t) in 2029 to to 6,600t in 2030.
Australia has been anti-nuclear in the past but in recent months there has been momentum around lifting a mining uranium ban in Western Australia and introducing nuclear power into the country’s energy mix. Local mineral explorers have also voiced concerns about missing out on the uranium boom.
However, Parnham says miners like himself are just generally underfunded and this needs to change.
“You can pick any of the commodities, it is the same story,” he says.
This was echoed in the Red Book, which notes that while the declining uranium exploration and mine development expenditure has been reversed, substantial investment in new mining projects will be essential to meet nuclear power generation projections to 2050 and beyond.
Sufficient uranium resources exist to support both the continued use of nuclear power and its significant growth through 2050 and beyond, it adds, but this is only true if timely investments in new exploration, mining operations and processing techniques are sustained.
Windsor agrees. “If you want to boost domestic production from non-geopolitical areas like Kazakhstan, then you need to invest in it – and that commitment needs to be maintained for at least a decade to shift the dial,” he says.
To some extent this has started to happen, with the US and Canada providing grants and financial assistance, but Parnham says there also needs to be a loosening up of regulatory regimes, which he believes will happen as demand increases and supply of uranium becomes a political issue. However, it still takes a long time for new mining projects to go from discovery to production.
“Really, when I speak about the regulatory regime loosening up a bit [it is] to help companies move these projects quicker, because the investors need to have a return on their investment,” says Parnham.
“What we are finding is it is just taking way too long, from exploration to permitting to development, for these earlier investors to get their return,” he adds.
Parnham believes Trump could make the change happen. “He is moving at a rapid pace to eliminate this [bureaucratic] overhang of the system the US has developed over the years. So, he has definitely got the will, and I think he could make it happen in the US, for sure.”
He concludes by adding, however, there also needs to be a longer-term ‘thinking’ horizon: “China thinks 50, 100 years out. We [only] think four years or so, and you can't possibly integrate mining into a four-year cycle.”
"Uranium crunch: the race to fuel the West’s nuclear energy revival" was originally created and published by Mining Technology, a GlobalData owned brand.
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