Kazakhstan and Japan will produce rare-earth metals together

Experts discuss the possibility of Russian involvement in the project

A few days ago the Kazakh delegation, headed by the secretary of state Kanat
Saudabayev returned from Japan, where prospects in the sphere of nuclear power engineering wee discussed as well as political issues. As a result, the sides agreed on the creation of a joint company operating in the sphere of rare-earth metals.

Kazakhstan possesses enormous deposits of oil, gas and various metals.
There are about 810 thousand tonnes of uranium ore alone in Kazakh
steppe, making Kazakhstan second only to Australia in this regard. The
country has been increasing production of uranium in recent years.
Meanwhile, the Japanese have been making progress in the sphere of
uranium fission and mastering rare-earth metals. Japan has become the
world's largest importer of these substances. New areas of cooperation
with Kazakhstan will play an important
role in diversifying deliveries of rare-earth elements to the Japanese
domestic market. Rare and rare-earth elements are the basis for advanced
technological  products. They are extensively used in radio electronics,
instrument making, nuclear technology, mechanical engineering, chemical
industry and metallurgy. Rare-earth elements enter into the composition of
special-purpose glass; monocrystalline compounds of rare-earth elements are
used to create laser and other optically active and nonlinear elements
in optical electronics, and also in the production of rechargeable batteries for the
car industry( e.g. electric vehicles)

The ceremony of signing the constituent instruments concerning the creation of a
joint  enterprise - the Summit Atom Rare Earth Company (SARECO) in the sphere of rare
and rare-earth metals took place in the Ministry of the Economy, Trade and
Industry in Tokyo.
The document was signed by the president of "Kazatoprom" ,Vladimir
Schkolnik, and the president of the Sumitomo Corporation, Susumi Kato.
"Kazatoprom" will hold a 51% share in the company,
and the Sumitomo Corporation will hold a 49% share. The headquarters of SARECO
will be situated in Oskemen. The establishment of SARECO is the
realization of an order made by Nursultan Nazarbayev after his visit to
Japan in 2008. The aim of this project was defined as the creation of
a vertically-integrated company for producing rare-earth products with
high added value.

During the first stage SARECO will engage in project feasibility studies
for production of rare and rare-earth  metals. The project proposes the
construction and implementation of an ore-dressing complex, hydrometallurgical
production of collective concentrates of rare-earth metals, chemical
manufacturing of rare-earth metals separating into individual metal oxides. Uranium tailing dumps will be used in
the capacity of potential sources of rare and rare-earth compounds and
metals, solutions of in-situ leachings of uranium seams and mineral deposits of rare-earth metals. The new joint
enterprise will also export and sell the finished commodities. The Summit
Atom Rare Earth Company is expected to commence work in June.

The establishment of SARECO was preceded by the signing of a memorandum on
mutual understanding and mutually beneficial collaboration concerning the
project of rare-earth metals mine working in Kazakhstan between the
Sumitomo Corporation and the JOGMEC. It was also preceded by the signing of an
agreement concerning the foundations of joint work on a feasibility study and
analysis of production of rare-earth metals with the Sumitomo
Corporation. Both the documents were  signed last autumn in Astana in the
course of the 10th joint conference  of the Kazakh-Japanese and
Japanese-Kazakh committees for economic cooperation.

Experts think that the conclusion of these agreements will create favorable chances
for other Japanese companies with ties to the nuclear sector to enter the Kazakh
market. Meanwhile, the Japanese press reports that there is a real
possibility that Russia, with which an analogous
intergovernmental agreement has already been signed, could join these plans.


VC reference
The Sumitomo Corporation is one of the major Japanese companies. It was
founded in 1919. The company's field of activity includes metals, transport
and facilities, infrastructure, media market  and retail sales, chemistry
and electronics, mineral resources and energy sector projects, realty,
финансы finance and logistics. The distribution network of the  Sumitomo
Corporation is represented in 69 countries and employs around 40 thousand
employees. The Sumitomo Corporation has huge experience in implementing
large-scale projects in Kazakhstan. Since 2006 a joint enterprise АППАК
created by the joint-stock "Kazatomprom" together with the Sumitomo
Corporation and the Kansai Electric Power Co. has been operating in the
south of Kazakhstan. АППАК is engaged in the development of the "Western Mynkunduk" uranium deposit.


The joint-stock "Kazatomprom" is a national Kazakh operator in exporting
uranium and its compounds, rare metals, nuclear fuel for nuclear power
plants, special equipment and twofold purpose materials and technologies.
The main company's fields of activity are geological prospecting, uranium
mining, manufacturing production of the nuclear fuel cycle, the nuclear reactor
industry, nuclear power plants, manufacturing construction materials,
energy projects, science, social service and personnel education. As of
today there are 26 thousand people working for the company. "Kazatomprom" is one of the world's largest uranium-mining companies.