- Region: Asia
- Energy and Natural Resources
- Overseas Investment Loans
May 1, 2007
Japan Bank for International Cooperation (JBIC; Governor: Kyosuke Shinozawa) signed on April 30 a loan agreement totaling 198.8 million US dollars for developing uranium deposits in Kazakhstan. The signing ceremony, held in the country's capital city of Astana, was attended by a joint high-level mission of the Japanese government and its private sector. The loan will finance a uranium mine development and production project in the province of Kyzylorda where Kyzylkum Limited Liability Partnership (LLP) will develop uranium deposits in the Kharassan-1 mining area and Baiken-U LLP will develop uranium deposits in the Kharassan-2 mining area. The loan was cofinanced with private financial institutions.
The uranium deposit development project in Kharassan is undertaken by Kazatomprom, a state-owned atomic company, and other participating Japanese companies: Marubeni Corp., Tokyo Electric Power Co., Inc. and Chubu Electric Power Co., Inc. A total of 5,000MTU uranium concentrate will be produced annually from the two deposits, with these participating Japanese companies having the right to obtain up to 2,000MTU.
Uranium is a fuel for nuclear power generation, which accounts for slightly more than 30% of Japan's total power generation. From the long-term perspective of securing stable supplies of energy sources and taking effective measures against global warming, the Japanese government plans to produce up to 30 to 40% of Japan's total power through nuclear power generation. While Japan relies totally on imports to meet domestic uranium demand, its price has been rapidly rising in recent years amid increasingly intense competition for energy sources. It is thus critically important for Japan to secure a long-term, stable supply of uranium. Although Kazakhstan has the world's second-largest proven uranium reserves, Japan currently imports only a minimal volume. From the viewpoint of diversifying supply sources, it is crucial to strengthen relations with Kazakhstan, a key producer and supplier of uranium. It is against this background that JBIC has decided to provide financing to help secure a long-term, stable supply of uranium and cement with Kazakhstan.
Based on the memorandum of understanding (MOU) signed last year with Kazatomprom on comprehensive strategic partnership, JBIC has held close discussions with it on various issues, including this loan. As Japan's official external financing institution, JBIC will continue to make constructive efforts, including project structuring and risk taking, to support the projects that will contribute to securing important energy resources for Japan.