Uranium resources: Another look at Iran’s practical needs

States utilizing or considering adding nuclear power to their energy mix need to have confidence in their ability to obtain nuclear fuel in an assured and predictable manner. Iran, in spite of its large hydrocarbon resources, is not exception to that.  Albeit in the history of the nuclear industry, there has never been a disruption of supply that has led to a loss of electricity generation, utilities secure the efficacy of their fuel supply chain by securing uranium, conversion, enrichment, and fuel fabrication services. Like any other chain, the chain it is not stronger than its weakest link. If you are not able to buy enrichment services, you will likely have same trouble with buying uranium. Similarly, for the nuclear fuel, you need—in addition to uranium and enrichment—fuel fabrication technology to be totally independent.

Iran’s published energy plans include acquiring a 20,000 MWe nuclear capacity, and construction of four research reactors, which will be, inter alia, according to Iran, designed to produce isotopes for medical purposes. To support this, Iran has been developing supporting infrastructure, which includes two uranium mines (Gachine and Saghand), and a uranium conversion facility in Isfahan, where also additional installations for fuel fabrication are being planned or constructed. The Iranian government plans to develop up to 8 GWe net of installed nuclear capacity by 2025 in order to reduce its reliance on fossil fuels, beginning with the installation of three more units at Bushehr. It has reportedly been in discussions with the Russian Federation to expand co-operation and engaged in identifying potential sites for additional reactors.

This ambitious program will reduce reliance on fossil fuels, but it will need substantial uranium resources in support. Recently published OECD/IAEA Red Book on global uranium resources and productionindicates that Iran has very scarce domestic uranium deposits. According to the Book, which uses data given by the Atomic Energy Organization of Iran (AEOI), the annual uranium need for the Bushehr 915 MWe is 160 tonnes. According to this data provided by the AEOI, Gachine and the other milling facility in Ardakan produce about 70 tonnes uranium annually, which is less than half of current Iranian needs. Iran estimates that with the additional nuclear power reactors the need is, at least, 590 and 1,230 tonnes uranium annually, in 2020 and 2035, respectively. According to this assessment, Iran’s total recoverable uranium resources in Ardakan and Gachine are about 1,000 tonnes.

In other words, the nuclear program of Iran will depend heavily on uranium imports, a fact that was already recognized in 2003 in the debate in the Iranian Parliament, when several parliamentarians questioned the reasonability of investing in nuclear power when, in their view then (only Saghand mine was then known) only 15-20% of needed uranium could be covered from domestic resources, and only for one reactor. An additional argument in the forthcoming debate in the Majlis with regard to the agreement on the “practical needs” of the nuclear program to be concluded with the P5+1 will also be the price of domestic uranium. According to the Red Book, Iranian uranium will costs $80-130 /kg uranium, when the current international spot market had in August 2014 a price tag of $63 /kg uranium.[1]

What this means is that in considering Iran’s practical needs, the nuclear issue has other facets - that in actual fact – reduces the scope of what Iran can and should produce in a realistic assessment of a civilian nuclear path forward.