De Beers announced on Tuesday that it will team up with Canada’s Cameco Corporation to look for uranium for the first time in the far North.
The Johannesburg, South Africa-based diamond company will allow Cameco to search its Aberdeen Lake property in the eastern Arctic territory of Nunavut for the mineral that is becoming increasingly valuable recently as nations such as China and the United States look to nuclear power to meet rising energy demands.
Uranium is used to fuel nuclear power reactors.
The property, where De Beers has been prospecting for diamonds since 1998, consists of 14 mineral permits covering approximately 2 300 square kilometres, about 150km west of the Baker Lake hamlet, the company said in a release.
”It’s the first such agreement that we’ve searched for uranium,” said spokesperson Linda Dorrington. ”We still remain dedicated to exploration and mining of rough diamonds. There’s no shift in focus, but we’re increasingly aware of the benefits to be derived from partnerships.”
”We are aware that we may be looking for a particular mineral, but there may well be other minerals on our properties,” she said.
De Beers announced a similar exploration deal with Inco in October 2004 to look for nickel on Baffin Island.
Cameco, the largest uranium producer in the world, must spend at least 300 000 dollars (US$245 000) in the first year of the agreement with De Beers and may spend up to 1,8-million dollars (US$1,5-million) on uranium exploration over the next four years. In return, it will earn a 60% interest in the
property.
If any uranium is found, Cameco will be responsible for mining and marketing the mineral.
A global uranium shortage of 45 000 tonnes is expected over the next decade, according to a May report by the Asia Pacific Foundation of Canada funded by Canada’s foreign affairs department, largely due to growing Chinese demand, prompting fierce competition recently among nations in this area.
The United States remains Canada’s primary customer, receiving half of the annual 11 600 tonnes of uranium produced here each year.
But, China is planning to spend billions of dollars to build 40 more nuclear reactors by 2020 to generate electricity and feed its booming economy while reducing its reliance on coal — currently nuclear power represents only one percent of its energy supply compared to coal at 66%. – Sapa-AFP