Kazakhstan is the largest uranium producing country in the world, accounting for 40% of the global uranium supply in the 2017. In addition, due to their geological characteristics, the majority of uranium deposits in Kazakhstan are ISR conducive, meaning Kazakhstan accounts for approximately two-thirds of the total global reserves suitable for ISR extraction.

In 2017, Kazatomprom was the largest uranium producing company globally, with its attributable production accounting for 20% of the total global primary uranium production. We have maintained our share in the global uranium production at the level of at least 20% since 2011.

Our extensive asset portfolio comprises 13 uranium assets across Kazakhstan and we are able to grow our resource base with relatively limited investment.

As the national atomic company, Kazatomprom enjoy statutory pre-emptive rights over uranium-holding deposits in Kazakhstan.

Nuclear generation has some key intrinsic advantages over other sources of electricity. It is able to provide baseload capacity, unlike most other renewable sources of energy, and is associated with minimal environmentally-damaging air emissions such as greenhouse gases, compared to fossil fuel-based generation.

Demand for uranium products is overwhelmingly driven by nuclear power generation, which is expected to remain robust in the coming decades. According to UxC, the global nuclear generation capacity is expected to increase by 11% to 432 GWe in 2030 from 388 GWe in the year ended 31 December 2017. As at 30 June 2018, there are 443 operating nuclear reactors globally and 56 nuclear reactors were under active construction in 17 countries.

The Company believes that the supply side of the uranium market is undergoing a structural shift, following a prolonged period of depressed spot prices and oversupply, underpinned by the prevalence of legacy long-term contracts, the majority of which were concluded in the period between years 2005 and 2012.

Gradually expiring legacy long-term contracts, combined with production cuts by leading industry players, as well as declining secondary supplies from enrichers and government inventories are all expected to put significant constraints on the supply.

The Company believes, based on information provided by UxC, its average costs are consistently in the first quartile of the global uranium production cost curve.

According to UxC, Kazakhstan further accounts for 65% of the world’s measured and indicated resources suitable for ISR mining.

These low production costs are primarily driven by the geological structure of our deposits, which enables cost-efficient and environmentally friendly ISR extraction technology.

Together with our partners, Kazatomprom operates 8 out of the 10 largest ISR mines in the world, based on 2017 production volumes.

As the largest ISR producer, we have accumulated extensive experience and knowledge, which allows us to constantly increase the efficiency of our mining operations. In addition, the geological nature of Kazatomprom’s reserves, which are located below water table, excludes the risk of water cross-contamination resulting from ISR operations.

This structural cost advantage is further underpinned by a generally relatively lower cost base (such as costs of services, personnel, utilities) in Kazakhstan compared to developed markets such as Canada and Australia, which are the other major uranium producing countries.

The uranium mining industry, as well as the broader nuclear value chain, is characterised by the particularly long-term nature of supplier-customer relationships compared to the majority of other commodity industries.

Kazatomprom has proven to be a reliable supplier to the industry for the past 20 years since the Company’s foundation and has created a global sales and distribution footprint including THK in Switzerland and a representative office in the United States. As the largest uranium producer globally, we have established relationships with the majority of global consumers of civil uranium and developed a high quality blue chip customer base.

As at 30 June 2018, Kazatomprom had 16 customers from 8 countries.

We supply uranium to 8 out of the 10 largest operators of nuclear generation capacity globally.

We also benefit from Kazakhstan’s physical proximity to China, the fastest growing nuclear fuel market in the world. China is expected to be the fastest growing nuclear power market globally.

In addition to relationships with the industrial buyers – operators of nuclear generation capacity - in 2018 we entered into a long-term supply agreement with Yellow Cake Plc, а long-term corporate holder of physical uranium, listed on the London Stock Exchange.

The health and safety of our employees is our first priority, and we have established and implemented advanced health and safety, as well as environmental, policies and controls at all of our operations.

We have adopted an ISO-14001-based environment management system and OHSAS-18001-compliant health and safety management systems.

ISR technology is considered by the IAEA to have environmental and safety advantages as compared to conventional mining and milling. This, among other things, is demonstrated by the absence of any major environmental accidents in Kazatomprom’s operations since inception. We maintain robust monitoring systems over groundwater and soil in the ISR process, radiation protection and other environmental risks.

Supporting the International Social Security Association (ISSA)’s initiative of improving industrial safety, health and well-being, we became a partner of the Vision Zero international program, confirming our intention to reach zero injuries through adherence to the seven “golden rules” promulgated by the program.

The average radiation exposure for our personnel is currently 0.80 mSV, one of the lowest in the uranium sector. Our LTIFR amounted to 0.15 and 0.45 for the 2017 year and the first six months 2018, respectively.

Kazatomprom’s leading market position in the global uranium market, low-cost operations, ability to adjust production volumes and prudent financial policy collectively allow us to achieve a robust and sustainably strong financial performance under varying market conditions, as well as demonstrate strong resilience to uranium price fluctuations.

Resilience demonstrated during low uranium price environment such as the one prevailing during 2016-2018.

We are committed to a sustainable dividend policy aimed at ensuring predictable and equitable distribution of the generated cash flow to shareholders, while preserving financial stability and prudent leverage levels.

Our experienced management team has a proven track record of delivering on a focused strategy and achieving robust performance amidst a volatile industry and macroeconomic environment, as evidenced by its operating and financial results in recent years.

Kazatomprom benefits from the Company’s experienced and balanced Board of Directors, which includes three highly regarded independent directors with extensive international experience in the uranium and broader nuclear industry.

The Board of Directors, as well as each of its committees, are chaired by independent directors.

Although our primary focus is on our core business of uranium mining, we also produce fuel powder and pellets at UMP which has a track record of more than 60 years and is one of the suppliers of fuel pellets for nuclear power plants in China.

Kazatomprom is well positioned to capture any potential opportunities in other segments of the front-end nuclear value chain that may occur following a shift in the nuclear fuel market, primarily through selected business partnerships with our international peers.

Kazatomprom’s primary customers are operators of nuclear generation capacity, with the principal export markets for our products being China, South-East Asia, North America, Europe and the Asia-Pacific region.

We sell uranium and uranium products under long-term contracts, short-term contracts, as well as in the spot market through our Switzerland-based Trading House KazakAtom (THK) subsidiary.

As the national atomic company in the Republic of Kazakhstan, the Company has partnered with substantially all of the leading players in the uranium mining industry globally. We have built 10 successful asset-level partnerships with Cameco, CGNPC, Kansai, Marubeni, Orano (formerly Areva), Rosatom and Sumitomo, as well as the Energy Asia consortium.