By Ryu Jin
Staff Reporter
A South Korean consortium composed of two state-run and two private energy and resources companies has signed a contract for joint exploration and development of a uranium deposit in Canada, according to their spokesmen Thursday.
Executives from the Korea Resources Corp. (KORES) and the Korea Electric Power Corp. (KEPCO) signed an agreement with CanAlaska Uranium for the 16-billion-won ($17.4-million) project to explore and develop the mine in Cree-East deposit.
SK Energy and Hanwha, the leading enterprises in the industry, also taking part in the joint project that will determine the size of the Cree-East deposit over the next four years.
Once the exploration phase is over, the four South Korean companies will take over a 50-percent stake in the deposit, which covers 559.35 square kilometers, roughly the size of Seoul, located in the southeastern part of the Athabasca Basin.
Government officials and industry sources attached much significance to the project, which they said presented a new model for participation of South Korean firms in overseas projects, as they formed a consortium made up of developers and users of resources.
South Korea, which relies heavily on imported natural resources for power generation, buys about 4,000 tons of uranium from overseas every year to power its 19 atomic reactors.
Uranium prices have been going up steadily. Uranium sold for $136 a pound on the international market this month, a substantial increase from the average of $75 five years ago, according to the Ministry of Commerce, Industry and Energy.
Industry sources worry about further price hikes due to a sharp rise in demand from newly emerging markets such as China and India. Moreover, uranium deposits are expected to dry up by around 2016, according to some experts.
``A lot of countries are making all-out efforts to acquire more uranium,'' an SK Energy spokesman said. ``We decided to join the project as domestic demand for future energy resources will increase 50 percent by 2016.''