The government has given state-owned Terrafame the go ahead to recover and refine uranium at its mine in Sotkamo in Eastern Finland.
Finland’s government has given state-owned Terrafame the go ahead to recover and refine uranium at its Sotkamo mine in the east of the country.
The decision will make Terrafame the country’s lone uranium producer and may open the door for other energy fuel miners to advance projects in the Nordic nation.
There are currently four nuclear reactors in operation in Finland with several more in various stages of construction. The existing reactors produce 30 percent of the country’s electricity and are considered to be some of the world’s most efficient, with an average lifetime capacity factor of over 85 percent, according to the World Nuclear Organization.
Terrafame plans to refine the recovered uranium to produce yellowcake, a uranium oxide product critical in the manufacturing of the fuel used by nuclear power plants.
The battery metals miner initially applied for the uranium recovery permit in October 2017 after receiving the required chemicals and environmental permissions.
In June 2019, the Radiation and Nuclear Safety Authority in Finland (STUK) issued a statement in support of Terrafame’s application as well as a safety assessment for the project.
“The nuclear and radiation safety risks caused by the production of uranium to the environment and the residents in the area are minor,” STUK stated. “In practice, minor risks mean that the radiation exposure of the employees at the uranium recovery plant is minor and the production of uranium will not expose members of the public to additional radiation.”
Uranium mining is becoming increasingly important as fossil fuels are phased out in favor of green energy solutions like nuclear power. There are currently 440 nuclear power reactors around the globe supplying 10 percent of the world’s electricity.
There are also dozens of reactors under construction, underscoring the need to raise uranium output.
Terrafame is now waiting to hear if the decision will be appealed by the Supreme Administrative Court of Finland. The company has already spent 75 million euros on the uranium recovery plant at the mine and will invest another 10 million euros to complete the plant.
“The process of getting the uranium recovery plant ready for use will take approximately one year, during which time the plant’s organization will also be built,” states the announcement. “…Terrafame estimates it will take approximately two years until the (uranium recovery) permit has legal force.”
In the meantime, the U3O8 spot price remains rangebound at US$24 to US$26 per pound, making it hard for current producers to justify extraction.
Miners in the top producing countries have been steadfast in stressing that the spot price needs to be higher — above US$45 per pound, a price unseen since 2015 — for the market to remain healthy.
Forecasted supply shortfalls could be enough to move the price higher; however, much of the North American sector was stagnant in 2019, awaiting a decision from the Trump administration regarding the safety of the nuclear fuel cycle and domestic quotas.
The US is the largest consumer and buyer of U3O8, while the country produces less than 1 percent of the uranium it uses.
Don’t forget to follow us @INN_Resource for real-time news updates.
Securities Disclosure: I, Georgia Williams, hold no direct investment interest in any company mentioned in this article.