Global scramble for Uranium spells trouble for UK’s nuclear plans

BY:RHODRI MORGAN

With no signs of easing, the UK must urgently factor a price surge into its nuclear plans

City A.M.’s energy editor Rhodri Morgan delves into the sector’s challenges in his weekly column.

The global rush for Uranium, and the consequential price spike, could pose a major headache for the UK’s nuclear power ambitions. 

Nuclear power currently provides about 10 per cent of the world’s electricity. And, despite this relatively small market share, – fossil fuels account for 61 per cent and renewables 29 per cent – nuclear energy, and by extension uranium production, is big business.

Over the last week, the price of Uranium concentrate – commonly known as U308 or yellowcake – has risen to a 15-year high of $80.25/lb.  The $139/lb high reached in 2017 came shortly after the world’s largest undeveloped uranium deposit flooded, driving panic around short-term supply. 

This time around, there’s no flood to speak of. In fact, there is a global uranium mining malaise. In order to be converted to nuclear reactor-ready energy sources, yellowcake needs to be converted and enriched, meaning buyers secure long term contracts for the ore from producers.

Over the years utilities have relied on existing over-supplied inventories until about 2018. This is where utilities – the primary user of uranium fuel – should have begun restocking supplies, but didn’t. 

Bram Vanderelst, head of uranium at Head of Uranium at Curzon Uranium, said it was a case of complacency, the effects of which are being seen fully now. 

“Utilities started running down stockpiles and bought as they needed it because uranium prices were at multi-decade lows and there was massive amounts of inventory,” he said. “When the market gets tight and stories come out about under-ordering and under-supply, that’s utilities panicking and covering.”

This is the wave uranium is riding, and will likely ride for the next year or two, as utilities rush to market to stockpile during a time when there’s not enough to go around, driving the price even higher. 

And to make matters more complicated, for Western states at least, Russia is the sixth largest producer of Uranium in the world.  Though Moscow appears to hold the cards, it can’t afford to withhold supplies from the West either as it tries to solidify its positions on reactor construction overseas. 

China is also aggressively buying up uranium. Its current total operable reactor net capacity is around 53,286 Megawatt electric (MWe), almost half that of the US. And it has 27,749 MWe capacity under construction, almost four times as much as second-place India. 

The required uranium for these projects is likely to deepen the already existing supply shortfall, sending prices, you guessed it, higher.

With no signs that the scramble is easing, the UK should urgently factor in this price surge into its nuclear plans.

West Cumbria’s nuclear expertise to shine in Paris

Posted on 26 Nov 2023 
Photo courtesy of McMenon Engineering

West Cumbria's nuclear capabilities are to be promoted by a delegation of key industry leaders at the World Nuclear Exhibition (WNE) in Paris next week. The three-day event, taking place 28-30 November in Villepinte, will bring together prominent stakeholders, innovators, and experts from around the world to discuss and explore the latest advancements in the nuclear sector. The delegation from West Cumbria will be based at the UK & EIC (Energy Industries Council) Pavilion).

Led by the Department for Business and Trade, the Northern Powerhouse delegation includes: Industrial Solutions Hub (iSH), www.par.com PAR Systems (UK) Ltd, McMenon Engineering Services Ltd, James Walker, FIS360, Nuclear Transport Solutions, Barrnon and Oakwood Engineering Solutions. The contingent represent the region’s commitment to excellence, innovation, and collaborative progress within the nuclear technology sphere.

John Maddison, managing director of iSH-based in Cleator Moor, said the role of iSH is to represent and highlight the capability of the West Cumbrian supply chain, acting as a voice for the businesses and academic institutions unable to attend themselves. He added: "West Cumbria has long been a hub for nuclear excellence, and our participation in the WNE underscores our commitment to advancing the industry globally. This is a chance to showcase our capability to a global market.

West Cumbria has a diverse and well-established skills base geared towards decommissioning. That learning and innovation can be used and harnessed elsewhere with our knowledge and learning shared across the world. The goal is to bring back collaboration opportunities for the SMEs who so ably support our nuclear services.”

PAR Systems (UK) Ltd is an advanced engineering company specialising in remote and material-handling solutions for the nuclear industry. Managing director John McGibbon said: “We are delighted to be participating at this year's event as part of the UK Pavilion. We look forward to showcasing our specialist expertise in remote/material handling systems; manipulator systems for in-cell operations; maintenance, site support and upgrade of nuclear cranes and decommissioning applications for the nuclear industry.”

Exploring new horizons
Anand Puthran, McMenon Engineering CEO, said: “As we navigate the currents of growth and diversification, attending the WNE marks a pivotal step in our journey. We are not just showcasing our prowess in providing flow and temperature measurement instrumentation for nuclear projects, but also highlighting the crucial role we can play in this dynamic industry. It is about more than presence it is a commitment to fostering collaborations, exploring new horizons, and solidifying McMenon’s position as a key player in the civil nuclear landscape.”

James Walker, a leading provider of sealing solutions, will demonstrate the crucial role of reliable engineering in nuclear applications. Mark Brook, James Walker manufacturing director, said: “Although James Walker has been supplying sealing solutions to the nuclear industry for many years, applications are constantly developing. We want to make sure that our materials and expertise are considered in these cases, so I will be using the visit to the WNE to carry out research into key application opportunities and to try to identify companies we may be able to partner with in developing solutions to new challenges.”

Frank Allison, CEO of FIS360 said: “FIS360’s participation at the WNE is an opportunity to highlight the importance of innovation and how it shapes the future of nuclear advancement. Our aim is to foster active connections, share insights and explore collaborative partnerships, ultimately contributing to the collective growth of, and innovation within, the nuclear sector.”

The WNE will provide an invaluable platform for these West Cumbrian entities to forge international partnerships, share knowledge, and contribute to the global conversation on the future of nuclear energy. The delegation's presence at the exhibition is a testament to West Cumbria's status as a hub for nuclear innovation and expertise.