Press Releases

Long-term growth for South African uranium industry remains optimistic

31 May 2017

Although, South Africa’s uranium production declined by 7.8% in 2016 from that of 2015, mainly as a result of the continuous fall in the uranium spot price and lacklustre demand growth.

Although, South Africa’s uranium production declined by 7.8% in 2016 from that of 2015, mainly as a result of the continuous fall in the uranium spot price and lacklustre demand growth, a rise in long-term production is forecast, supported by several upcoming projects. Also, a projected increase in demand for nuclear power as an alternative to coal-fired electricity provides an opportunity for the South African uranium mining industry according to research and consulting firm GlobalData.

South Africa is among the top five countries in the world in terms of uranium reserves, with 322,400t, or 6%, of known global uranium reserves. However, it is only the eleventh-largest producer, with 362.4t, or 1%, of global uranium produced as a by-product of gold and copper mining in 2016.

South Africa’s electricity sector depends heavily on coal, with state-owned power utility Eskom producing 219,979GWh of electricity in 2016, with 199,888GWh, or 91%, produced by coal-fired power plants. Eskom operates 28 power stations with a combined capacity of 42 810MW, with 36,441MW, or 85%, accounted for by coal-fired power plants and only 5.5% generated by nuclear power. Koeberg, with an installed capacity of 1,800MW, is the only nuclear power plant operating in South Africa, near Cape Town.

The country’s huge dependency on coal, coupled with sluggish uranium demand and a low commodity price environment, creates a challenge over the short-term for the domestic uranium end-use sector. “However, President Jacob Zuma indicated in his 2016 State of the Nation address that nuclear energy will remain part of the future domestic energy mix. He also mentioned that the country is planning to add 9,600MW of nuclear energy to the national grid by 2030.”

Whether this will materialise is uncertain, as the Department of Energy’s draft Integrated Resource Plan states that, by 2037, government aims to increase nuclear power capacity by only 1,359MW, owing to low demand and the high cost of nuclear power technology



Source: Company Press Release

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