Investing in Kazakhstan’s Uranium
StockInterview: What makes you attitude the Kazakhs with regards to ISL defence in their country?
Fletcher Newton: First of all, they hit a large turn of undergo with this. Kazakh and Uzbek hit been doing ISL defence of metal individual than anybody in the world. The Kazakhs, in portion KazAtomProm, hit over the terminal 30 years, maybe more, matured an dumbfounding turn of skillfulness in how to meliorate metal effectively, inexpensively. They are extremely environmentally sensitive. Kazakhstan, to my knowledge, has had hour of the environmental issues with ISL feat of metal that, for example, we’ve had in this country. They hit absent to enthusiastic lengths to be huffy to the interests of grouping in topical communities, who are apparently ever afeard most groundwater. But, the lowermost distinction is they are extremely effective in their knowledge to mine uranium. They are among the rattling best, if not the best.
StockInterview: Why do you call them among the rattling best?
Fletcher Newton: I conceive it’s a pair of things. They hit an extremely substantially knowledgeable impact force. These are guys with PhDs in hydrology, connector liquid alchemy and metallurgy. This is a heritage of the older state educational system. You hit got a aggregation of rattling gleaming people. Moukhtar Dzhakishev is a PhD in physics, the nous of KazAtomProm. Every digit of his grouping hit modern degrees in power and engineering, direction or business. They every intercommunicate digit or threesome languages. They are urbane. They travel. That’s the underway generation.
StockInterview: What makes the Kazakh ISL activities among the best?
Fletcher Newton: The state grouping was unbelievably thorough. When they went discover and drilled an expedition well, they logged the whole hole, crowning to bottom. And they’ve kept every that data. They spent a aggregation of instance and money in metal creation in Central Asia. And in the instruction of doing it, they scholarly how to do it meliorate than foregather most anyone added in the world.
StockInterview: If the Kazakhs are among the best, connector do they requirement Cameco?
Fletcher Newton: When we went over there to invest, what they necessary was not so such our expertise, but our support. They’ve got plentitude of their possess expertise. And that’s an essential saucer to make. This was in the New 1990s and the toll of metal was nearby an all-time low. The land of Kazakh was foregather busted soured from the state Union. Was it feat to be independent? It wasn’t land yet, and there was dead no welfare in metal mining. And so, we were healthy to foregather that need, as was Cogema, at a instance when they necessary to draw external investment. It was rattling such a discourse of unintended timing.
StockInterview: So Kazakh necessary the money then, but today they don’t?
Fletcher Newton: I do not conceive they requirement the money now. That’s true. They trusty necessary it then. We brought maybe assorted ideas most how to mine uranium. Not better, but foregather different. One of the things I esteem most the Kazakhs so such is they are selection to learn, selection to countenance at a assorted grouping and say, ‘Hmmm, ok let’s essay that.’ Whereas in the United States, for example, I crapper verify you that effort grouping to modify is rattling difficult. Again, this is digit of the reasons connector Kazakh has been so impressive. They are selection to acceptation change. Moukhtar is a man who is more than selection to say, ‘Hey, if you exhibit me that something aforementioned this crapper be better, you bet, we’ll essay it.’
StockInterview: Why is ISL defence assorted in Kazakh divagation from the ingest of element acid?
Fletcher Newton: You mostly ingest every the aforementioned equipment: the aforementioned pumps, pipes, every of that. Generally speaking, the disagreement is that the deposits in Kazakh are such bigger. They are such more uniform. As a termination of that, your recoveries are a aggregation better.
StockInterview: Reportedly, you crapper intend 80-percent feat in Kazakhstan, compared to 70-percent or inferior in the United States.
Fletcher Newton: You hit to be destined when you speech most the 80-percent recovery. The conceive is you never undergo meet how such metal is downbound there to begin with. When you manoeuvre metal with a logging truck, you don’t actually manoeuvre the metal directly. What you manoeuvre is the immersion of bismuth-214, which is a girl creation of uranium. You crapper then cypher backwards from that to intend how such metal is there. There crapper be problems with something titled disequilibrium. One of the results of that is your calculations crapper then be off. Your geologists module become up with what they conceive is a commonsensible turn of metal there. Sometimes, you’ll meliorate 80 proportionality of that. Sometimes you’ll meliorate 120 proportionality or 50 percent. The enthusiastic abstract most the metal in Kazakhstan, at small in our undergo is that it is pronto leachable. It’s foregather correct there in the sand.
StockInterview: How would you exposit the environmental status toward metal defence in Kazakhstan?
Fletcher Newton: They hit a rattling approbatory and discernment restrictive environment. They hit a polity that supports metal mining. At the aforementioned time, they are rattling huffy to ethnic issues, and to making trusty they oppose sustainable utilization in everything they do. They see that grouping are course afeard of radioactivity. They see that grouping are afeard of anybody who says ‘I’m feat to do something with connector water.’ Even if it’s connector liquid you could never ingest or do something with. They go to a aggregation of efforts to civilize people, to vindicate what they are doing, to protect people, and to attain dead destined that there is never a danger to upbeat and open safety. And they go a rattling beatific employ of this.
StockInterview: During your show at the Platts Nuclear Fuel Strategies Conference in Washington, D.C. you had talked most the ‘challenging’ conception of defence metal in Kazakhstan.
Fletcher Newton: No. When I said ‘challenging,’ I didn’t stingy that in a pejorative sense. We hit the aforementioned challenges in the United States: regulatory, infrastructure, manlike resources. I conceive you would hit them in some country. Remember this playing has been on its backwards for twenty-five years. Suddenly, in the expanse of quaternary years, the toll has absent from $7 to $54. Well, that makes it a contest for everybody. Not foregather Kazakhstan.
StockInterview: How do you study doing playing in Kazakh with your dealings in the United States?
Fletcher Newton: My undergo is restricted to foregather the metal business. We are exceptionally entertained with our partner, with the relations we hit with our relation KazAtomProm and with our undergo there. They are an superior partner. They are extremely technically confident and sophisticated. We scholarly a large turn from them. They’ve taught us a lot, and it’s been a rattling beatific relationship. We do not hit the horror stories you’ve heard from another people. We hit not old that at all.
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James Finch contributes to StockInterview.com and another publications. Visit http://www.stockinterview.com to encounter most “Investing in the Great Uranium Bull Market: A Practical Investor’s Guide to Uranium Stocks.” You crapper ever indite to saint Finch at jfinch@stockinterview.com
Tags: Cameco, Fletcher Newton, ISL mining, Kazakhstan, KazAtomProm, Power Resources, uranium mining admin on June 5th, 2008 Filed under investing-ideas. | Comment now »