Zoovch-Ovoo to start trial uranium mining in October

23th of 7, 2018

E. Od

A pilot production programme at the Zoovch-Ovoo uranium deposit at Zuunbayan Bag, Dornogovi aimag will begin in October 2018, according to Terry Pleasant, Executive Director of  Badrakh Energy, the name under which Areva Mines has been operating since January 2018.

Pleasant told media that construction of the processing plant started last year and would be finished in June 2018. The next three months would see arrangements being made for commissioning it, which will include getting the radiation safeguard plans approved by the General Agency for Specialized Inspection, getting permission from the Ministry of Environment and Tourism to transport and store the uranium, placing security deposits, and establishing a joint council. This last will comprise stakeholders and will be responsible for overseeing all work relating to beginning the pilot production, and ensuring that the operation is run in a responsible and reliable way. The security deposit is mandatory under the Law of Mongolia on Nuclear Energy. The company is currently negotiating with the Government on the amount of the deposit.

Badrakh Energy is legally obliged to enter into a cooperation agreement with authorities of Dornogovi aimag and some time ago submitted a draft agreement to the local administration. This has now been returned, with suggestions for some changes. Inspection and maintenance work on the railway from the project area in Zoovch-Ovoo to Zuunbayan Bag will be conducted between June and August. The company has begun talks with all relevant ministries and organizations to ensure that all preparatory work goes smoothly.

Pleasant revealed that 20 months after trial production begins, yellowcake output is expected to be 20 tonnes. Full production capacity will of course be higher. Strict environmental monitoring will be in place throughout.

The feasibility study of the Zoovch-Ovoo project study is being revised in great detail and should be ready in 2021, by which time the pilot programme will be over and the environmental impact assessment can also be taken up.

The French state-owned Areva Group has been in Mongolia since 1997. It holds radioactive exploration and mining licences through its subsidiaries, Areva Mongol and Cogegobi. Exploration work between 2005 and 2009 led to the discovery of the Dulaan-Uul deposit in Ulaanbadrakh aimag, and its 6,270 tonnes of uranium resources were registered in 2011. Another uranium deposit was discovered later, with registered resources of 4,700 tonnes. This has been named Dulaan and the company is going to ask for a mining licence soon. The Zoovch-Ovoo deposit was discovered during exploration work in Zuunbayan bag from 2007 to 2010, and its registered resources were 54,639 tonnes in 2013. The company hopes to add another 10,000 tonnes to this following more exploration in 2019.

Both Dulaan-Uul and Zoovch-Ovoo are listed as strategically significant deposits. Together they have some 75,000 tonnes of uranium ore, around 50% of Mongolia’s total. Areva Mines was established in 2013 -- with the Mongolian state-owned Mon Atom Co. owning 34% and Areva Mongolia the remaining 66% -- to implement the Zoovch-Ovoo project. Mon Atom has a cooperation agreement with Mitsubishi of Japan, which will invest the amount for which Mon Atom is responsible as 34% owner of the project.
The Mineral Resources and Petroleum Authority granted a mining licence for radioactive minerals to Cogegobi in June 2015. Cogegobi transferred this to Areva Mines in March 2016. Areva Mines started work at Zoovch-Ovoo in 2017 and renamed itself as Badrakh Energy in 2018.

Currently, Badrakh Energy holds three mining licences in two uranium deposits in Dornogovi aimag.
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