Clock - Uranium Supply Crunch and Critical ... - Andrew Johns

Canada Research | Page 12 of 87UraniumMine SupplyTaking a Conservative Approach on Primary Supply. Exhibit 9 lays out our global minesupply through 2030E. Key assumptions include continued growth of Kazakh productionbeyond 2012E (to 67 Mlbs in 2017E), successful Cigar Lake start-up in 4Q13E, and greenlights for the premier low-grade African projects (e.g., Imouraren, Mkuju River, Husab).In 2020E and beyond, the Olympic Dam expansion, Wheeler River, and Kiggavik-Sissonseach push forward.Exhibit 9: RJL Global Mine Supply by Major Production Center (Mlbs/year)3002752502252001751501251007550250CAGR2004-2011: 4.27%2012-2016: 8.26%2017-2021: 6.41%200420052006200720082009201020112012201320142015201620172018201920202021202220232024202520262027202820292030Other Countries Kazakhstan Other NIS Russia Other AfricaNamibia Niger U.S.A. Other Canada Cigar LakeMcArthur River Other Australia Ranger Olympic DamSource: Raymond James Ltd., UxC, WNA, NIW, Company ReportsOur model reflects a conservativeview on mine supply and includesseveral major high cost mines andexpansionsOver the past 7 years, Kazakhstan has emerged as a dominant producer, while outputfrom Canada and Australia has waned. We expect Kazakhstan to continue to be asignificant growth region, but its share of the global supply mix to drop as African minesramp-up and Canada and Australia rebound.Exhibit 10: Global Supply by Country in 2004A, 2011A and 2016E (Mlbs)Kazakhstan,8.6, 8.4%Uzbekistan,5.3, 5.2%Ukraine, 2.1,2.0%Russia, 8.4,8.1%Namibia,7.9, 7.6%China, 1.8,1.8%Niger, 8.5,8.3%S. Africa, 2.0,1.9%Other, 2.9,China, 2.2, Other, 2.6,Other, 2.0,China, 2.3,2.8% 1.6% 1.9% Australia,1.0% Australia,1.1%Australia,15.7, 11.4%20.5, 10.1%23.3, 22.6%U.S., 2.1,2.1%Canada,30.2, 29.2%Kazakhstan,50.6, 36.6%Uzbekistan,6.3, 4.5%Ukraine, 2.3,1.7%Russia, 8.0,5.7%Canada,23.8, 17.2%U.S., 4.0,2.9%S. Africa, 1.5,1.1%Niger, 10.8,7.8%Namibia,Malawi, 2.2, 8.5, 6.1%1.6%Kazakhstan,63.9, 31.4%Uzbekistan,6.3, 3.1%Ukraine, 4.8,2.4%Russia, 11.4,5.6%Tanzania,342.2%2004A 2011A 2016ESource: Raymond James Ltd., UxC, WNA, NIW, Company ReportsKazakhstan should remain thedominant supplier, but emergingAfrican and rebounding Australianand Canadian mines shouldcapture market shareMalawi,332.4%Canada,36.9, 18.1%U.S., 11.4,5.6%S. Africa, 2.0,1.0%Niger, 18.1,8.9%Namibia,17.1, 8.4%More Conservative than Other Groups. Our supply forecast is well above (i.e., moreconservative vis-à-vis prices) the reference scenarios from WNA (published September2011) and UxC (1Q12) through 2030, above WNA’s high scenario in the 2012 – 2027period (before dipping below as mines deplete) and below UxC’s high forecast until2022, two years after UxC peak production in 2020.Our mine supply curve is generallyhigher (i.e., more conservative visà-visprices) than those of UxC andWNARaymond James Ltd. | 2200 – 925 West Georgia Street | Vancouver BC Canada V6C 3L2