JSC National Atomic Company “Kazatomprom” (“Kazatomprom” or “the Company”) announced today its intention to continue to flex down production by 20% through 2021, compared to the planned levels under Subsoil Use Contracts. The Company will now begin working with joint venture partners to assess the impact and implement the plan across all of Kazakhstan’s uranium mines.
The decision to extend production curtailment reflects the fact that the uranium market is still recovering from a period of oversupply, and uranium prices remain low. As the largest uranium producer in the world, Kazatomprom recognizes the need for global output to better align with current demand.
The Company is announcing the plan well before year-end to ensure its mining subsidiaries and joint ventures will be able to incorporate the required changes into their 2020 capital expenditure budgets, accounting for the revised production levels in 2021. No decision has been taken regarding production levels beyond 2021 and the Company continues to monitor market conditions. However, Kazatomprom does not expect to return to full production until a sustained market recovery is evident, and demand and supply conditions signal a need for more uranium.
The full implementation of this decision would remove up to 5,600 tU from anticipated global primary supply in 2021. Kazatomprom’s 2021 production would remain below 23,000 tU (100% basis), which is expected to be in line with production in 2019 and 2020, where a 20% reduction of annual Subsoil Use Contract levels was reflected in previous reports (Competent Persons’ Report, IPO Prospectus 31 October 2018).
Galymzhan Pirmatov, Chief Executive Officer of Kazatomprom, commented: "Uranium recovered somewhat from the lows of 2016, but the market is still signaling that there is no need to bring back existing production capacity. Keeping production levels flat for now supports a return to long-term sustainability in the market, which will benefit all stakeholders. Delaying the return to planned output levels also demonstrates our commitment to the value-over-volume philosophy at the core of our strategy.”
Conference Call Reminder - 2019 Half-Year Operating and Financial Review
Kazatomprom has scheduled a conference call to discuss the full 2019 half-year operating and financial results, after they are released on Tuesday, 27 August, 2019. The call will begin at 17:00 (AST) / 12:00 (GMT) / 07:00 (EST). Following management remarks, an interactive English Q&A session will be held with investors (remarks in Russian with a simultaneous Russian translation of the Q&A available on a listen-only line).
Interested parties are invited to join the call using the following dial-in details. If calling from:
- Kazakhstan: +7 (8) 717 269 67 38
- United Kingdom: +44 (0) 80 0408 7373
- United States: +1 833 661 7897
To join the English call and participate in the live Q&A, enter conference room number 813569, with PIN 5207. To receive a reminder at the time of the call, participants may now pre-register for the English call at:
To join the call in Russian (listen-only Q&A), enter conference room number 357958, with PIN 6326. To receive a reminder at the time of the call, participants may now pre-register for the Russian call at:
A live webcast of the conference call will be available from a link at www.kazatomprom.kz home page on the day of the call. A replay will be made available after the call.
For further information, please contact:
Kazatomprom Investor Relations Inquiries
Cory Kos, Head of Investor Relations
Tel: +7 (8) 7172 45 81 80
Kazatomprom Public Relations and Media Inquiries
Torgyn Mukayeva, Head of Public Relations and Internal Communication
Tel: +7 (8) 7172 45 80 63
Powerscourt – London (Giles Read)
Tel: +44 20 7250 1446
Kazatomprom is the world's largest producer of uranium, with the company’s attributable production representing approximately 23% of global primary uranium production in 2018. The Group benefits from the largest reserve base in the industry and operates, through its subsidiaries, JVs and Associates, 26 deposits grouped into 13 mining assets. All of the Company’s mining operations are located in Kazakhstan and mined using ISR technology with a focus on maintaining industry-leading health, safety and environment standards.
Kazatomprom securities are listed on the London Stock Exchange and Astana International Exchange. As the national atomic company in the Republic of Kazakhstan, the Group's primary customers are operators of nuclear generation capacity, and the principal export markets for the Group's products are China, South and Eastern Asia, Europe and North America. The Group sells uranium and uranium products under long-term contracts, short-term contracts, and in the spot market, directly from its headquarters in Nur-Sultan, Kazakhstan, and through its Switzerland-based trading subsidiary, Trade House KazakAtom AG (THK).
For more information, please see our newly updated website at http://www.kazatomprom.kz
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