Press Release on Kazatomprom and Cameco cooperation

On May 29, 2007, the National Atomic Company Kazatomprom announces signing the Memorandum of Understanding with Cameco Corporation (Canada) for establishment of Conversion Facility and increase of natural uranium production.

Pursuant to MOU terms and conditions, Kazatomprom together with Cameco will prepare Feasibility Study for construction of Uranium Conversion Facility on the basis of “Ulba Metallurgical Plant” JSC (subsidiary of Kazatomprom) in Kazakhstan having ownership ratio of 51% (Казатомпром) to 49% (Cameco). «Cameco» provides conversion technology for the project. In future, depending on world market requirements the possibility of construction of the similar conversion facilities outside the Republic of Kazakhstan is also considered.   

This MOU provides for increase of projected uranium production from 2000t to 4000t per year at Inkai deposit (South Kazakhstan oblast) developed by Inkai Kanadian-Kazakhstani Joint Venture. Extra incremental growth of uranium production in spite of shareholding (Cameco – 60%, Kazatomprom - 40%), will be distributed by the companies on parity basis 50% to 50%.

Inkai JV produces uranium by in-situ leaching method being today one of the most environmentally sound practice of deposit development. JV will achieve annual production capacity of 2000t U3O8 in 2010.

Inkai JV has been certified in accordance with BSI OHSAS:18001 and ISO 14001: 2004 -  worldwide recognized standards for labor protection, safety engineering and environment protection.

It is planned that more detailed agreements for this project legally covering relationships of the parties will be signed in 2007. In this respect Kazatomprom will submit additional information.

Note

CAMECO having Headquarters in Saskatoon, Saskatchewan province, Canada is the leading company in the world in uranium production, processing and conversion using the best state-to-the-arts technologies with low costs. It owns the processing plant which is only one in Canada. Cameco is the main producer of nuclear fuel components for heavy-water reactors of Canadian design. The company has been established by merging of two state uranium producing and processing companies.