Nuclear Power, Uranium Supply and Demand Issues - by Lakeland Resources Inc. Advisor Tom Drolet

Nuclear Power, Uranium Supply and Demand Issues Zurich: Nov 12, 2013

For Lakeland Resources, LK: TSXV By

Thomas S. Drolet President, Drolet and Associates Energy Services, Inc.

[email protected] www.droletenergy.com

1-‐828-‐493-‐1523

PresentaTon’s BoVom Lines-‐Nuclear Power Plants

•  Baseload Nuclear Power Plants are required to enable a stable, reliable electricity delivery system for the more electricity driven future I see for our world.

•  Growth Leaders will be China, India, Russia, The Middle East, with some addiTons in Europe, South America, USA, Europe and SE Asia (435-‐720 by 2030).

•  Low prices are slowing supply… however.. This is a period to start to bring on supply to meet future increasing demand

•  There is a need for new types of centralized medium to smaller designs of nuclear plants (safer, beVer, more efficient)—Gen 4.

World % Fuel Use by Source Percent'

Oil$

Natural$Gas$

Coal$

Nuclear$

Renewables$

EE$and$Cons$

World Top 10 Countries in Nuclear GeneraTon

DistribuTon of World Nuclear Power Reactors

Number of Worldwide Nuclear Power Reactors

Issues to Consider re Announced Intent to Close Reactors

•  Japan—post Fukushima Dai-‐ichi (50 reactor swing) • Germany (17 reactor swing) • Switzerland (~4 reactor swing)

Main World Sources of Uranium

Mined World Uranium ProducTon by Country

Megatons to MegawaVs Program (MMP)

•  Agreement is from 19933-‐ to end of 2013 •  Private Industry players: Nukem, Areva, Cameco

•  It involved 25,000 Russian Warheads (500 Tonnes of HEU-‐ that is an average of 20 kg /warhead).

•  Most used in USA Commercial Reactors •  Injected 23 M lbs of U3O8 into the market. •  6 Million stayed in Russia •  17 M lbs between Nukem, Cameco and Areva

Uranium Sources and Grades SOURCE CONCENTRATION

•  Very high-‐grade ore 20% U 200,000 ppm U •  High-‐grade ore 2% U 20,000 ppm U •  Low-‐grade ore 0.1% U 1,000 ppm U •  Very low-‐grade ore 0.01% U 100 ppm U •  Granite 4-‐5 ppm U •  Sedimentary rock 2 ppm U •  Earth's conTnental crust (avg) 2.8 ppm U •  Seawater 0.003 ppm U

PresentaTon’s BoVom Lines Uranium Supply and Demand

•  DRIVER ISSUES: High U concentra/ons, reasonable extrac/on costs, U from Stable Countries of the World: all these issues will gradually see rising prices and increasing Partnership Opportuni/es for Canadian companies.

•  Uranium ProducTon Growth Regions 1.  Canada-‐Athabasca– 2.  USA—western basins (ISR) 3.  Australia 4.  ArgenKna 5.  Some parts of Africa, Mongolia

Total World Commercial Reactor Demand for Uranium as U3O8 in 2013

• Approximately 78,000 tonnes

or

• 170 + Million lbs

Nuclear Power Reactors under ConstrucTon 2012

OperaTon Country REACTOR Type MWe (net)

•  2012 India, NPCI Kaiga 4 PHWR 202 •  2012 Iran, AEOI Bushehr 1 PWR 950 •  2012 Russia, Kalinin 4 PWR 950 •  2012 Korea, KHNP Shin Kori 2 PWR 1000 •  2012 Korea, KHNP Shin Wolsong 1 PWR 1000 •  2012 Canada, Bruce Pwr Bruce A1 PHWR 769 •  2012 Canada, Bruce Pwr Bruce A2 PHWR 769 •  2012 Canada, NB Power Point Lepreau 1 PHWR 635 •  2012 ArgenTna, CNEA Atucha 2 PHWR 692 •  2012 India, NPCIL Kudankulam 1 PWR 950 •  2012 India, NPCIL Kudankulam 2 PWR 950 •  2012 China, CNNC Qinshan phase II-‐4 PWR 650 •  2012 China, CGNPC Hongyanhe 1 PW 1080 •  2012 China, CGNPC Ningde 1 PWR 1080 • 


•  2013 Slovakia, SE Mochovce 3 PWR 440 •  2013 Korea, KHNP Shin Wolsong 2 PWR 1000 •  2013 Korea, KHNP Shin-‐Kori 3 PWR 1350 •  2013 USA, TVA WaXs Bar 2 PWR 1180 •  2013 Russia, Rosenergoatom Leningrad II-‐1 PWR 1070 •  2013 China, CNNC Sanmen 1 PWR 1250 •  2013 China, CGNPC Ningde 2 PWR 1080 •  2013 China, CGNPC Yangjiang 1 PWR 1080 •  2013 China, CGNPC Taishan 1 PWR 1700 •  2013 China, CNNC Fangjiashan 1 PWR 1080 •  2013 China, CNNC Fuqing 1 PWR 1080 •  2013 China, CGNPC Hongyanhe 2 PWR 1080 •  2013 Slovakia, SE Mochovce 4 PWR 440 •  2013 India, Bhavini Kalpakkam FBR 470


•  2014 Finland, TVO Olkilouto 3 PWR 1600 •  2014 Russia, Rosenergoatom Vilyuchinsk PWR x 2 70 •  2014 Russia, Rosenergoatom Novovoronezh II-‐1 PWR 1070 •  2014 Taiwan Power Lungmen 1 ABWR 1300 •  2014 Japan, Chugoku Shimane 3 ABWR 1375 •  2014 China, CNNC Sanmen 2 PWR 1250 •  2014 China, CPI Haiyang 1 PWR 1250 •  2014 China, CGNPC Ningde 3 PWR 1080 •  2014 China, CGNPC Hongyanhe 3 PWR 1080 •  2014 China, CGNPC Hongyanhe 4 PWR 1080 •  2014 China, CGNPC Yangjiang 2 PWR 1080 •  2014 China, CGNPC Taishan 2 PWR 1700 •  2014 China, CNNC Fangjiashan 2 PWR 1080 •  2014 China, CNNC Fuqing 2 PWR 1080 •  2014 China, CNNC Changjiang 1 PWR 650 •  2014 Korea, KHNP Shin-‐Kori 4 PWR 1350 •  2014? Japan, EPDC/J Power Ohma 1 ABWR 1350 •  2014 Russia, Rosenergoatom Rostov 3 PWR 1070 •  2014 Russia, Rosenergoatom Beloyarsk 4 FNR 750


•  2015 Taiwan Power Lungmen 2 ABWR 1300 •  2015 China, CGNPC Yangjiang 3 PWR 1080 •  2015 China, CPI Haiyang 2 PWR 1250 •  2015 China, CGNPC Ningde 4 PWR 1080 •  2015 China, CGNPC Fangchenggang 1 PWR 1080 •  2015 China, CNNC Changjiang 2 PWR 650 •  2015 China, CNNC Hongshiding 1 PWR 1080 •  2015 China, CNNC Fuqing 3 PWR 1080 •  2015 China, Huaneng Shidaowan HTR 20 •  2015 India, NPCIL Kakrapar 3 PHWR 640


•  2016 France, EdF Flamanville 3 PWR 1600 •  2016 Korea, KHNP Shin-‐Ulchin 1 PWR 1350 •  2016 Romania, SNN Cernavoda 3 PHWR 655 •  2016 Russia, Rosenergoatom Novovoronezh II-‐2 PWR 1070 •  2016 Russia, Rosenergoatom Leningrad II-‐2 PWR 1200 •  2016 Russia, Rosenergoatom Rostov 4 PWR 1200 •  2016 Ukraine, Energoatom Khmelnitsky 3 PWR 1000 •  2016 India, NPCIL Kakrapar 4 PHWR 640 •  2016 India, NPCIL Rajasthan 7 PHWR 640 •  2016 China, CGNPC Yangjiang 4 PWR 1080

2015 China, CGNPC Hongyanhe 5 PWR 1080 2016 Pakistan, PAEC Chashma 3 PWR 300

•  2016 China, several others


•  2017 Russia, Rosenergoatom BalKc 1 PWR 1200 •  2017 Russia, Rosenergoatom Len II-‐3 PWR 1200 •  2017 Ukraine, Energoatom Khmelnitsky 4 PWR 1000

•  2017 India, NPCIL Rajasthan 8 PHWR 640 •  2017 Korea, KHNP Shin-‐Ulchin 2 PWR 1350 •  2017 Romania, SNN Cernavoda 4 PHWR 655

•  2017 Japan, JAPC Tsuruga 3 APWR 1538 •  2017 Pakistan, PAEC Chashma 4 PWR 300 •  2017 Bulgaria, NEK Belene 1 PWR 1000 •  2017 China, CNNC Taohuajiang 1 PWR 1250 •  2017 China, several others

Chernobyl, Ukraine

Chernobyl…. April 26, 1986.

•  A series of Operator errors , missed communicaKons and badly designed RBMK reactor system combine to cause a violent super heated steam explosion at the Chernobyl No. 4 nuclear power plant about 180 miles north of Kiev in the former Soviet Union.

•  The reactor had an inadequate containment building and very large amounts of radiaKon escaped.

Three Mile Island Unit 2 1979

Three Mile Island March 28, 1979.

•  The worst accident in U.S. commercial reactor history occurs at the TMI nuclear power staKon near Harrisburg, PA . The accident is caused by a combinaKon of mechanical malfuncKon and human error.

•  An open pressure relief valve permiXed coolant water to escape from the primary system, and was the principal mechanical cause of the lose of coolant and parKal fuel meltdown crisis that followed..

Japan’s Nuclear Energy Plants March 2011

Fukushima Dai-‐ichi Mark 1 BWR

Small Modular Reactor Design by B&W

One More BoVom Line Alternate Fuel Cycle Development

Molten Salt Reactors(MSR) Thorium?—not necessarily

BoVom Line on Uranium Supply and Demand (and Prices)

•  We need more mine producKon—in fact, a robust diversified series of new mined uranium producKon.

•  Uranium demand Partners will seek out Canadian listed companies and in Australia, ArgenKna and parts of Africa.

•  Prices will rise very moderately for the 2014 year as Japan sorts itself out and China, India and others ramp up.

•  Prices for Uranium will then ramp up post start 2015 Good Canadian picks in the Uranium space LK: TSXV, Cameco

End

This presentaTon will be available on

www.droletenergy.com

By Sunday 17 November 2013 And through Lakeland Resources, LK:TSXV

Thomas S. Drolet [email protected]

1-‐828-‐493-‐1523

Nuclear Power, Uranium Supply and Demand Issues - by Lakeland Resources Inc. Advisor Tom Drolet

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