China, Canada Strategic Partnership Strengthened Over $3 B Uranium Sale
On Thursday, the governments of China and Canada renewed yet again their bilateral ties over a planned sale of some $3 billion uranium yellowcake exports to the world's second-largest economy.
Under the agreement, Canada will enable China gain access to its uranium produce provide the Asian nation uses it for civilian purposes, such as energy generation for its many existing and planned nuclear power plants. The strategic partnership is touted to be worth as much as $3 billion.
"This agreement will help Canadian uranium companies to substantially increase exports to China, the world's fastest growing market for these products," Canadian Prime Minister Stephen Harper said in a statement, during a trip to Beijing. "It will generate jobs here at home while contributing to the use of clean reliable energy in China."
"Today there are 14 nuclear reactors operating in China, there are 27 under construction today and many dozens more expected by 2020. That's growth we haven't seen [in the nuclear power industry] since the 1970s," said Tim Gitzel, Cameco Corp. Chief Executive and part of Mr Harper's delegation on the China trip.
Canada's entry effectively puts it into direct competition with China's other current suppliers of uranium from Kazakhstan, Australia and Russia. The world's second largest exporter, after Kazakhstan, and ahead of Australia, Canada sends most of its exports to the U.S., Europe and Japan.
According to the World Nuclear Association, Canada produces about a fifth of the world's uranium every year and exports more than 80 per cent of its production.
Chinese companies signed billion dollar worth of deals in aviation, finance, rail transit mining, telecommunications, environmental protection, education and drugs with their Canadian counterparts during Mr Harper's visit to China, Xinhua News reported. No details were provided.
Mr Harper met Vice Premier Li Keqiang briefly before the fifth China-Canadian Business Forum, at which the deals were signed, the Chinese state news organization added.
"We couldn't deliver Canadian uranium here until this agreement was signed so it opens the door for us to do that," Mr Gitzel said.
In 2010, Cameco agreed into a supply arrangement with China to sell about 52 million pounds of uranium for Chinese reactors over 15 years. Delivery is expected to start this spring. Cameco expects some $3 billion sales from the contracts.
Yellowcake is a concentrated uranium powder used to make fuel rods for nuclear reactors. It can also be used to make weapons. As part of the pact with Canada, China agreed to use any imported uranium only for peaceful civilian purposes.
Following the pronouncement of the two heads of state, the Canadian Manufacturers & Exporters ( CME ), expects Canada and China to finalise and renew their memorandum of understanding on nuclear energy cooperation to cover research and development activity on recycled uranium and thorium. This would further expand access to China's market for Canadian nuclear technology, the CME said.
CME is Canada's largest trade and industry association, and the voice of manufacturing and global business in Canada.