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July 22, 2016 - China took center stage this week with news that the heads of Kazakh uranium producer KazAtomProm and China's CITIC Group have met to discuss attracting investment to the Central Asian country's nuclear energy sector. The talks build on agreements KazAtomProm signed with Chinese companies at year-end 2015, which include one for the development of Kazakh uranium mines and the construction of a nuclear fuel plant in Kazakhstan.
 
Chinese coal producer Shenhua Group Corp. is reported to be seeking a merger with state-owned China General Nuclear Power Corp., a deal that would create a utility giant with more than US$204 billion in assets. Any deal would combine China's largest coal producer with its largest nuclear power generator, giving Shenhua Group the ability to generate electricity from cleaner sources; both entities today denied working on a merger together. 
 
Separately, as part of Paladin Energy's strategic initiatives process, the company is proposing the sale of 24 percent of its Langer Heinrich Uranium Mine in Namibia, as well as the potential sale of up to 75 percent of its Manyingee Uranium Project in Australia, to raise in excess of $200 million. Paladin, which currently owns 75 percent of the Langer Heinrich Mine, signed a non-binding term sheet with an unknown "major participant in the global nuclear power industry" to sell 24 percent of its interest in the asset.
 
In the USA, Illinois lawmakers, Exelon, and other parties are working on providing the utility with a deal that could make the Clinton Nuclear Power Plant, currently scheduled for closure in June 2017, competitive in the power marketplace.
 
Lawmakers are exploring the creation of a zero emissions standard that would allow power prices at the plant to be subsidized, and for the plant to just break even. If a deal is reached with Exelon it will require approval from the Illinois legislature, which is scheduled to return in November. 
 
Market participants gathered in Washington, DC, this week for the Nuclear Energy Institute's Nuclear Fuel Supply Forum. While the tone of recent industry meetings has generally been negative due to unexpected US plant closures, the attitude of attendees at this week's meeting was more mixed. The spot uranium market saw a slight uptick in prices this week amid optimism about the potential for new demand to emerge in coming months. Several utilities—US and non-US—have indicated they intend to issue formal Request for Proposals (RFPs) for spot, mid-, and longer-term deliveries by year end. 
 
Although sellers are encouraged by the improved outlook for demand, current buying interest remains discretionary. A total of four transactions are reported for the week. Sellers included traders and producers, with utilities and traders acting as buyers.
 
TradeTech's Weekly U3O8 Spot Price Indicator is $25.25 per pound U3O8, up $0.25 from the July 15 Weekly U3O8 Spot Price Indicator and unchanged from the July 21 Daily U3O8 Spot Price Indicator. read more