2017: A Key Year for the Argentine Nuclear Industry

There is a distinct possibility that the almost seven-year bear market in uranium has finally run its course.

In 2017, Argentina committed to the construction of its 4th and 5th large nuclear power plants and is on schedule with refurbishment related with the life-extension and up-rating of the Embalse nuclear plant. Construction of the CAREM 25 small modular reactor (“SMR”) – one of only three SMRs under construction around the world – is reported to be progressing well.

Argentina continued importing all the uranium needed to fuel its reactors.  U3O8 Corp.’s Laguna Salada uranium-vanadium deposit, having an NI43-101 resource estimate and preliminary economic assessment, is well-placed to advance to production to provide an alternative source to imported uranium.

New Reactor Build

Electricity generation from nuclear in Argentina: Actual vs Planned

Electricity generation from nuclear in Argentina: Actual vs Planned. Data source: CNEA, IAEA

In April 2017, the government in Argentina ratified the agreement for the financing and construction of its 4th and 5th reactors.  According to the agreement, China is to provide 85% of the US$15 billion required for the projects.  Construction is to start on the 4th reactor later this year and on the 5th in 2020.

The Argentine government is also financing the construction of a prototype 25 megawatt (“MW”) SMR. The fuel for the SMR has already been purchased and is scheduled to be loaded into the core of the reactor later this year.  Nuclear industry spokespersons in Argentina have been quite open about the intention to use the prototype to attract interest in construction of SMRs elsewhere in the world as an export opportunity for the local technology.  After construction of the prototype, the plan is to construct a larger, 100-200MW SMR, using the CAREM technology, in Formosa Province in northern Argentina.

Current and Projected Electricity Generation from Nuclear

The amount of electricity generated by nuclear in Argentina is set to ramp up later this year when the Embalse reactor, which is being refurbished for a 30-year life extension and 6% power up-rating, comes back onstream.  The upward projection of nuclear electricity generation then accelerates with the 800MW 4th reactor coming onstream in 2024 and the 1,150MW 5th reactor in 2025.  Construction of these reactors will achieve the aim of generating 20% of the country’s electricity from nuclear by 2025.

Vanadium Leading the Uranium Market?

Uranium and Vanadium Prices

Uranium and Vanadium Prices. Source: Ux Consulting Company LLC, Cantor Fitzgerald, Assetmacro.com

Alongside nuclear, Argentina is also implementing an ambitious clean energy strategy that aims to generate 20% of its electricity from renewables by 2025: solar power from the Atacama Desert in the north and wind power from the Patagonian region in the south.

Energy storage could play an important role in efficient electricity distribution from solar in the extreme north, and wind and hydroelectricity in the extreme south, of the national grid.  Vanadium redox batteries (“VRB”) are proving to be viable for electricity storage on an industrial scale, and there is a distinct opportunity for this technology to be used to smooth and regulate power transmission through Argentina’s national grid.

Since U3O8 Corp.’s Laguna Salada Deposit would produce twice as much vanadium as uranium, the vanadium price has a significant impact on the economics of the Project.  It is exciting to see the vanadium price respond to the supply deficit after a decade-long bear market. With supply cuts in uranium production announced in November, there is a distinct possibility that the almost seven-year bear market in uranium has finally run its course.

Watch the interview and read Dr. Spencers’s article featured on Investor Intel.

About U3O8 Corp.

U3O8 Corp. is a TSX- and OTCQB-listed company (trading symbols TSX:UWE and OTCQB:UWEFF) focused on exploration and development of deposits of uranium and battery commodities in South America.  Battery commodities that occur with uranium resources include vanadium, nickel, zinc and phosphate.  The Company has resources, defined in accordance with NI 43-101, in three deposits, Laguna Salada in Argentina, Berlin in Colombia and Kurupung in Guyana.