Africa is set to become one of the world’s nuclear development hotspots in the coming years, as the continent looks to build a low-carbon and sustainable energy system. This has sparked a surge in uranium mining activities, as prices for nuclear fuel reached their highest levels in over a decade.
According to data from Canada’s Cameco, one of the world’s largest producers, the uranium spot price had reached $81.25/lb by the end of November 2023, up from $56.38/lb in late July and $24.25/lb in October 2019.
The rising demand for uranium is driven by the growing interest in nuclear power as a clean and reliable source of energy, especially in the wake of the COP28 climate summit, where 21 countries pledged to triple their nuclear capacity by 2050.
Among the countries that have expressed their intention to deploy nuclear power are Egypt, Ghana, Kenya, Morocco, Niger, Nigeria, and Sudan, which have already engaged with the International Atomic Energy Agency (IAEA) to assess their readiness. Algeria, Tunisia, Uganda, and Zambia are also studying the possibility of nuclear power.
The IAEA’s Director General Rafael Mariano Grossi said “Africa is hungry for energy, and nuclear power could be part of the answer for an increasing number of countries”.
To meet the expected demand for uranium, miners have intensified their exploration and extraction activities in Africa, where some of the world’s largest and highest quality uranium deposits are located.
South Africa and Niger are currently the only African countries that produce uranium, ranking third and seventh in the world respectively. However, several new projects are underway or planned in other countries, such as Tanzania, Zambia, Malawi, and Botswana.
In Tanzania, AuKing Mining raised $1.25m in November 2023 to fund drilling at its Mkuju project, which has a resource of 36.9 million pounds of uranium oxide. The company expects to complete a feasibility study by mid-2024 and start production by 2026.
In Zambia, GoviEx Uranium is developing the Mutanga project, which has a resource of 48.9 million pounds of uranium oxide. The company is conducting a feasibility study and expects to start construction in 2025, with production commencing in 2027.
In Malawi, Lotus Resources owns 85% of the Kayelekera mine, which was Africa’s fourth-largest uranium producer before it was placed under care and maintenance in 2014 due to low prices. Lotus plans to restart the mine once uranium prices reach its commercial threshold of $65/lb.
In Botswana, Lotus also acquired 100% of the Letlhakane project, which has a resource of 190.4 million pounds of uranium oxide, through a merger with A-Cap in November 2023. The company plans to conduct further exploration and feasibility studies on the project.
The uranium boom in Africa is not without challenges, however. Some of the issues that miners face include environmental and social impacts, regulatory uncertainties, infrastructure constraints, security risks, and public acceptance.
Despite these hurdles, the outlook for uranium mining in Africa remains positive, as the continent seeks to harness the potential of nuclear power to achieve its development and climate goals.
Source: Africa Energy
