"El Comercio" analysed the Macusani's uranium opportunityJuan Saldarriaga from "El Comercio" has posted a good summary about the uranium opportunity in Macusani, including why its exploitation would be postponed for some time.
Uranium in Puno: Why is it once again a valuable resource for Peru?
The energy transition towards cleaner technologies opens a window of opportunity for the exploitation of Macusani uranium. China, the US and Europe reactivate the construction of nuclear power plants: there are 431 projects planned and proposed.
Forty years ago it was thought that Puno could produce enough uranium to start up several nuclear power plants. Can that dream be relived? (Photo: Getty)
Uranium is part of the landscape on the Macusani plateau (Puno). It is found in the hills, in the pastures and even in the tuber crops of the peasant communities.
"The community members who live in the area have planted their potatoes over uranium for centuries and live to be 90 years without problems", says Gregorio Tasayco, exploration manager at Macusani Yellowcake, alluding to the absence of harmfulness of the radioactive mineral in his natural state.
The people of Macusani have lived with the yellow mineral since immemorial time without knowing that it was uranium, until the late 1970s, when the Peruvian Institute of Nuclear Energy (IPEN) verified its existence and began its exploration.
Then a possibility of development was opened for them that has not yet become effective.
"The expectation for uranium has been going on for decades", says Edward Rodriguez, former mayor of the Carabaya province of Puno.
NUCLEAR ENERGY
When the Peruvian government began to explore Macusani, they had in mind to discover enough volume of uranium to operate one or more nuclear power plants of 300 MW of power each (electricity generation is its main use).
Uranium is used as fuel in nuclear power plants to generate electrical energy.
IPEN discovered that volume. But the long-awaited exploitation of the radioactive mineral was diluted with the collapse of its international price in the 80s and 90s.
In the 2000s, however, an unusual bubble - the price soared from $10 to about $140 a pound - sparked a uranium exploration fever that brought IPEN's work to the fore.
The Macusani plateau was once again buzzing with activity, but this time by a dozen Canadian, Australian and Chinese companies seeking to capitalize on the findings of the 1980s.
Then the Fukushima nuclear disaster (2011) occurred and interest in uranium faded again. Until quite recently.
ENERGY TRANSITION
The second quarter of 2020 saw a rebound in the price of the radioactive mineral for the first time in a decade. And analysts are forecasting a possible rally in the next two years.
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In 2011 an earthquake struck the Japanese city of Fukushima. The nuclear reactor at the site withstood the earthquake, but not the tsunami that followed. The disaster led many governments around the world to stop their nuclear plans (Photo: AFP).
The reason? The closure of several large uranium mines and the energy transition towards cleaner technologies (than coal and oil), a circumstance that is motivating the reactivation of the plans to build nuclear reactors, plans that were abandoned after Fukushima.
"There are currently 442 nuclear reactors in operation, 52 under construction and 431 planned and proposed, the majority in charge of China", says uranium specialist Guido Arroyo.
Another reason is the development of nuclear modular mini-reactor (SMR) technology, an innovative idea by Bill Gates that allows adding nuclear power quickly and cheaply, and which is being adopted by countries such as the United States and Canada.
In fact, Arroyo believes that it could be applied in Loreto, a region separated from the national interconnected system by the dense Amazon jungle.
"Several small reactors, 100 MW, could solve the energy problem in the jungle", says the specialist. In an ideal situation, the best thing would be to produce in Peru the uranium that these plants need, as IPEN envisioned it three decades ago.
But that aspiration would not be within reach, due to regulatory issues, the understandable fear of the population in the face of radiation and market priorities.
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Bill Gates has launched an innovative idea to solve energy supply problems: mini nuclear reactors, cheap, safe and easy to transport.
TECHNICAL REGULATIONS
"The problem of uranium exploitation is the waste it leaves behind", says Renan Ramirez, head of the IPEN authorization department.
He points to the case of the German Ronneburg mine, exploited by the Soviet Union during the cold war, which is costing Germany $8 billion in environmental remediation activities.
For this reason, the International Atomic Energy Agency (IAEA) recommends the implementation of special regulations for the handling of uranium.
This regulation is still incipient in Peru. Due to this, the Minem requested in 2019 the assistance of the United States government to elaborate the technical standards that allow to exploit and process the Macusani uranium.
These standards should have been published at the end of 2020. Everything indicates, however, that they would not be ready until the end of 2022, “if there is interest” in approving them, says Ramirez.
The problem, explains the official, is that the documents must go through a scrutiny process between IPEN, Minem (Ministry of Energy and Mines) and Minam (Ministry of Environment), in addition to the training of qualified professionals in the inspection and control of uranium mining, something that does not exist in Peru and could take up to five years. But there is another problem.
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The yellow cake or yellowcake is the best known presentation of uranium. To produce it, special regulations are required (Photo: Financial Tribune)
URANIUM OR LITHIUM?
When the Fukushima plant gave in to the forces of nature in 2011 (it withstood the 9-scale earthquake but not the tsunami) interest in uranium began to fade in the world and also in Macusani.
In subsequent years, the companies that packed the plateau were abandoning exploration, until only one remained monopolizing the "abandoned building": Macusani Yellowcake.
It was developing this solitary task that the Canadian discovered lithium in an area far from the uranium deposit, an extraordinary event that gave a second wind to the exploration in Macusani.
This finding, made in 2017, turned the company's strategy upside down: henceforth lithium, and no longer uranium, would be its focus.
For this reason it has been clarifying in recent months that both metals are separated and not together in the same ore. This means that lithium could be exploited without the need for a regulation for radioactive minerals.
“Between the uranium from Tantamaco and the lithium from Falchani there are 30 kilometers of distance. Therefore, it is not true that lithium and uranium from Macusani are associated”, assures Rolo Zapana, metallurgist from Macusani Yellowcake.
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Macusani Yellowcake maintains that the lithium and uranium mineralization at Macusani are far enough apart from each other to allow them to be exploited separately (Graphic: Macusani Yellowcake).
The company's goal is clear: to exploit the lithium first and keep the uranium for when the regulations for radioactive minerals are in place.
For this reason, Arroyo estimates that uranium exploitation would not occur before 2025. Furthermore, the United States Nuclear Agency ventures 2035 as the probable date.
Macusani Yellowcake has delineated 56,700 tonnes of uranium in Macusani, which would be equivalent to the energy potential of Camisea gas.
Note: For the preparation of this article, the Uranium Mining forum, organized by Elite Consulting, was of great help.