Cameco‘s McArthur River uranium mine in northern Saskatchewan. The first shipments of Canadian uranium concentrate are expected to arrive on Chinese shores within a year.Reuters
Canada's vision to ship large quantities of oil and natural gas to China will be preceded by another key energy export: uranium.
Shipments of Canadian uranium concentrate are expected to arrive on Chinese shores within a year under a new agreement, once Parliament ratifies a new protocol for trade, says Saskatchewan Premier Brad Wall.
"I just don't see a lot of roadblocks" to an arrangement that is expected to open the door to some $3-billion in sales over the next decade, possibly starting as soon as six months from now, Mr. Wall said in an interview in Beijing this week. "It's very significant."
Saskatchewan-based uranium miner Cameco Corp. joined a major Canadian trade delegation here this month, encouraged by a supplementary protocol to the Canada-China Nuclear Co-operation Agreement negotiated earlier this year by Prime Minister Stephen Harper and signed by Foreign Minister John Baird this summer. The agreement will govern exports of uranium, used to fuel nuclear reactors.
China has 14 reactors now on line, 26 more under construction and several dozen more believed to be in the planning stages, part of its drive to move away from polluting fossil fuels in supplying its energy-hungry industries and population of 1.3 billion.
The country now imports most of its uranium from Kazakhstan, Uzbekistan, Namibia and Australia, and has faced difficulties in securing supply, making the Canadian market that much more important.
"Who knows the scope of it. The [potential] is very huge – if you look at 85, 86 reactors, it's a huge market," said Ryan Baerg, a senior specialist in government relations with Cameco. China is expected to have more than 80 nuclear reactors by 2030. "That's just massive growth in the nuclear program."
Cameco already has lengthy fixed-commitment contracts with China's two major nuclear utilities, but has been fulfilling these using operations in Kazakhstan rather than its primary mining operations in northern Saskatchewan.
With neighbouring Japan weaning itself off nuclear energy dependency following last year's horrific earthquake, tsunami and resulting radioactive emissions from the Fukushima plant, the Chinese market has become even more important to the nuclear power industry.
"China represents, in my opinion … the last frontier of growth for nuclear power in the world, especially after the Fukushima disaster," said Robert Alvarez, a senior scholar at Washington's Institute for Policy Studies, who under the Clinton administration served as senior policy adviser to the U.S. Secretary of Energy. "Because China is such a big, vast nation even a goal of a small portion of their energy demand could mean substantial growth for their nuclear power industry."
One issue in the protocol has been ensuring the uranium is kept for peaceful purposes. Though China is a signatory to the international Nuclear Nonproliferation Treaty, it is the sole regional ally to renegade nuclear state North Korea.
There are also concerns about how China may be modernizing its domestic nuclear weapons program, given its growing levels of military spending at a time when China has been rattling sabres over the ownership of uninhabited Pacific islands controlled by Japan, known as Senkaku in Japan and the Diaoyu in China, though scholars say China has been very careful to separate out its civilian nuclear power program.
"I think China has not been running around giving away nuclear secrets, or aiding and abetting proliferaters. It's not in their interest to do that," Mr. Alvarez said.
China already has two Candu 6 reactors operating at Qinshan, and the China National Nuclear Corp. earlier this year signed an agreement with Mississauga-based Candu Energy – now part of SNC-Lavalin – to expand a program feeding those reactors recycled uranium.
"Everybody understands safety, everybody understands what happened in Japan but at the end of the day that industry is going to move ahead, there is no question," said Lionel LaBelle, CEO of the Saskatchewan Trade and Export Partnership, part of this month's trade delegation.