Japans Mitsui plans to co-produce uranium in Russia

Japanese trading house Mitsui and Co. says it plans to jointly develop one of the world’s largest uranium mines in Russia to supply Japanese nuclear power plants.

Mitsui and the Russian state-owned nuclear fuel firm Techsnabexport (Tenex) will together spend nearly 29 billion yen (245 million dollars) to develop the mine, with the aim of beginning production in 2009, a Mitsui spokesman said.

Mitsui hopes to own 25 percent of the Yuzhnaya mine, located in the Sakha Republic in far-eastern Russia.

It will be the first case of a foreign company developing a uranium mine in Russia, said the spokesman, who declined to be named.

Mitsui and Tenex signed a contract Thursday in Moscow to start feasibility studies as a first step towards deciding on the percentage of exclusive negotiation rights it will take for commercial production, he said.

Mitsui will shoulder about 706 million yen (5.98 million dollars) for the initial studies on drilling methods and the environmental impact, he said.

The companies believe the mine, which has estimated reserves of more than 250,000 tons of uranium, could yield up to 1,000 tons a year by 2015.

“If we could obtain 25 percent (of that), the company could supply annually about 250 tons of uranium to nuclear power plants in Japan,” the spokesman said.

Resource-poor Japan relies on nuclear generation for some 30 percent of its electricity with annual uranium consumption of about 8,700 tons a year.

Former Japanese prime minister Junichiro Koizumi visited Central Asia in August as part of efforts to establish more diverse energy supplies.

Japan imports nearly all of its oil, mostly from the volatile Middle East including
Iran, which is facing possible international sanctions over its nuclear program.