BUSINESS
PROFILE
GRI 102-1
Kazakhstan is an uranium mining industry leader, providing more than 45% of the global uranium demand annually, aimed at covering the world’s nuclear energy needs. As the national operator of the Republic of Kazakhstan for the exports and imports of uranium, and nuclear fuel for nuclear power plants Kazatomprom has the priority access to one of the world's largest resource bases.
KEY INDICATORS AND ACHIEVEMENTS
exploration
projects
%
of the global
uranium
production
mining
assets
%
of reserves can be
extracted by in-situ
recovery
UN SUSTAINABLE DEVELOPMENT GOALS
EN RU KZ

BUSINESS MODEL

Core Operations and Products

GRI 102-2

Kazatomprom is the largest global producer of natural uranium with priority access to one of the world’s largest uranium reserves.

Core operations:

Natural uranium
mining

Production of uranium
products

Prospecting and
explorationв

Producing rare
metals

Kazatomprom is:

Company's Asset Structure

14 mining assets operating in 26 deposits/blocks located in Kazakhstan, using the in-situ recovery (ISR) mining method, including:

Kazatomprom’s key assets in 2021

Company Asset description
Subsoil use
Subsoil use contracts that grant the Group's subsidiaries mining rights in relation to 17 uranium deposits/blocks located in Shu- Sarysu and Syrdariya regions of Kazakhstan Proven and probable ore reserves: 351,500 tonnes of UME
Measured and estimated mineral resources: 499,400 tonnes of UME
Subsoil use contracts that grant Group's joint ventures and associates mining rights in relation to 9 uranium deposits/ blocks in the Shu-Sarysu, Syrdariya, and North Kazakhstan regions Proven and probable ore reserves: 273,900 tonnes of UME
Total mineral resources (including measured, indicated, and inferred resources): 285,00 tonnes of UME
Production
Ulba Metallurgical Plant JSC Annual productivity:
  • 3,728 tonnes of U3O8
  • 317 tonnes of UO2 powder made from UF6
  • 155 tonnes of UO2 powder
  • 108 tonnes of fuel pellets
  • 1,626.9 tonnes of beryllium products
  • 141.9 tonnes of tantalum products
  • 25.2 tonnes of niobium products
Commerce
Trade House KazakAtom TH AG Uranium trading
Ancillary businesses
SKZ-U LLP
SSAP LLP
680,000 tonnes of sulphuric acid – total annual production capacity
Volkovgeologia JSC A prospecting and drilling company
Trade and Transport Company LLP Transport and logistics company serving production assets
Qorgan-Security LLP Security services for Kazatomprom, its subsidiaries, and affiliates
KAP Technology LLP Ensures local and corporate telephone communications, data transmission, and VHF radio communications services to Kazatomprom’s entities
Uranenergo LLP Electricity transmission and distribution, operations of power grid and stations, reliable and uninterrupted power supply to uranium mining enterprises of Kazatomprom
Science, Engineering and Education
Institute of High Technology LLP Addresses strategic objectives in Kazakhstan’s nuclear sector to drive its innovative development, technological upgrade, palpable improvement in the quality and competitiveness of knowledge-intensive products, conducts R&D activities, works to introduce innovations in the sector, employees training and retraining

Mineral assets

GRI 102-4

Company’s mineral assets are located in four key administrative districts of Kazakhstan:

Uranium Products Market Overview

Key highlights, 2021

GRI 102-4

Global uranium demand with regards to nuclear power plant reactor needs and commercial and strategic reserves

., k tU


Global uranium supply

., k tU


Global natural uranium
production

., k tU

Average spot quotes

$.05 (w)/$.28 (m)

Significant developments in the global uranium market

Green Taxonomy
of EU
The European Commission has decided to include nuclear energy and natural gas in the EU Green Taxonomy. Within the framework of the taxonomy, restrictions are introduced addressing nuclear energy projects in terms of minimizing radioactive waste. At the time of writing, it was decided that, in the absence of comments, the act on the adoption of taxonomy will take effect on January 1, 2023.
China Chinese government ratified its 14th Five-Year Plan, covering a wide range of economic goals and providing an overview of the country’s plans to develop its energy infrastructure. The plan continues to strongly support nuclear power, envisaging an increase of nearly 40% compared to 2020, with some 70 GW of nuclear power capacity by the end of 2025. By 2030, the capacity is expected to increase up to 100 GW.
Climate Strategy The UN Climate Change Conference 2021 (COP 26) took place between October 31 – November 13, 2021. According to the Agreement adopted by countries, COP 26 recognizes that limiting global warming to 1.5°C requires rapid, deep and sustained reductions in global greenhouse gas emissions, including a 45% reduction in carbon dioxide by 2030 compared to 2010 levels. The Climate Pact does not specify any technologies, but these decisions implicitly support the accelerated introduction of nuclear power due to its low emissions.
Financial investment companies In addition to various end-users of uranium products, in 2021 there was an active involvement of financial investment companies focusing on physical uranium storage and representing 'non-traditional demand'. The most significant event was the completion of Sprott Asset Management LP's acquisition of Uranium Participation Corporation (UPC) in July and the subsequent listing of Sprott Physical Uranium Trust (SPUT) on the Toronto Stock Exchange. SPUT used the proceeds of the ongoing investment units for an active campaign to procure natural uranium.
Covid-19 The world continues to struggle with the COVID-19 pandemic, with a focus on rolling out mass vaccination and revaccination campaigns. This adversely affected uranium production in a number of countries as operations were closed to protect employee welfare.

PRICING

As the sale of natural uranium and uranium products is the main source of the Company's income and profit, market prices for uranium products have a significant impact on the Company’s financial performance.

Supply-demand balance shapes the market price for uranium products, as for any commodity. The average sales price of uranium sold by any major producer is also quite dependent on the types of contracts concluded and the structure of their sales portfolio (terms, price formulae used in each contract, the proportion of spot and longterm contracts, etc.).

Kazatomprom expects that nuclear power, as a reliable source of carbon-free, base-load electricity, will underpin its position in the broader energy market, resulting in greater demand for uranium in years to come. Kazatomprom is well placed to benefit from this, as it is the key low-cost producer.

URANIUM OUTPUT IN 2021

GRI 102-7

In 2021, Kazatomprom produced 11,900 tonnes of uranium, which equals 24% of global production which ranked it first globally in terms of natural uranium production. In the context of continued production cuts by a number of key competitors, by the end of 2021, Kazatomprom ranks first in the world in the natural uranium mining.

In August 2021 Kazatomprom announced its intention to continue cutting production by 20% in 2022 against targets under subsoil use contracts. The decision to cut production for another year will reduce the projected global primary uranium output by 5,500 tonnes in 2022, but maintain the uranium production in Kazakhstan at a level similar to that expected in 2021.

At the same time, Kazatomprom plans to maintain production in 2023 at the same level as in 2022, which is expected to be 20% lower than the projected volumes under the subsoil use contracts, keeping production almost at the same level in 2022 and 2023.

On June 24, 2021 Kazatomprom announced the plan to develop blocks 6 and 7 of the Budenovskoye field for the period between 2021-2045 with a ramp up in production to 2,500 tons of uranium not earlier than 2024, and a maximum possible annual production capacity of up to 6,000 tons of uranium not before than 2026. Specific commissioning dates and future annual production volumes are subject to annual review, and actual production volumes are subject to change depending on Kazatomprom's ongoing analysis of market conditions. According to the written agreements with the JV partners, the entire expected production volume of the JV Budenovskoye between 2024-2026 is fully reserved for feedstock supply to the Russian civil nuclear power industry on market terms under an off-take contract.

Uranium prices, 2010–2021, USD per lb U3O87

Reactors commissioning and decommissioning in 2021

Analysis of Performance Dynamics

GRI 102-6, 102-7

In 2021, Kazatomprom retained its position as the world's largest uranium producer (based on its attributable share of production). According to UxC, the Company's uranium production in 2021 amounted to 24% of the total global primary uranium production. Kazakhstan accounted for more than 45% of global uranium production in 2021.

PRODUCTION HIGHLIGHTS

Kazatomprom's share in the global natural uranium mining market (based on its attributable share of production), %
In 2021, Kazatomprom maintained a stable share of the global primary uranium mining market (based on attributable share of production). In the reporting period, Kazatomprom's share increased by 1.5% compared to 2020, allowing it to maintain its position as the world's largest producer and leader uranium sales.
Kazatomprom's uranium output (attributable share of production), tonnes
In 2021, U3O8 production on both a pro rata and 100% basis was higher than the previous year, due to lower mine development activity and lower staff numbers in the second quarter of 2020 because of the impact of the COVID-19 pandemic.
Niobium product output, tonnes
In 2021, niobium production decreased by 7.87% compared to 2020, due to the change in demand for niobium products.
Beryllium product output, tonnes
Compared to the level of 2020, the output of beryllium products in volume terms increased by 2.79% in the reporting period, in response to an increased demand for beryllium products.
Tantalum product output, tonnes
Compared to the levels of 2020, the output of tantalum products increased by 9.13% in the reporting period in response to an increased demand from customers.
Fuel pellet output, tonnes
The volume of fuel pellets production in 2021 amounted to 43.517 tonnes. Compared to 2020, a 30% decline in production of fuel pellets occurred in the reporting period due to the timing of the acceptance procedure for the 2nd batch of pellets (34 tonnes) at CGNPC.

FINANCIAL HIGHLIGHTS

Group revenue, KZT billion
Group revenues were KZT 691.0 billion in 2020, a 18% YOY increase, mainly due to an increase in the average realization price spurred by a rising market spot price for U3O8 and the weakening of the tenge against the US dollar. The growth is also associated with a YOY rise in sales volumes in 2021 of 1%.
Earnings per share, KZT/share
Earnings per share in 2021 were 23% lower than in 2020, which primarily resulted from an increase in earnings attributable to non-controlling interests (NCI), as well as from the sale of the Company's 49% interest at ME ORTALYK LLP.
Dividends paid, KZT billion
In July 2021, the Company paid dividends of KZT 150.1 billion to its shareholders based on its 2020 performance, an increase of 52% compared to 2020 when it paid dividends of KZT 99 billion to the shareholders based on the 2019 performance. The increase resulted from higher operating cash flows and inclusion of proceeds from the Group’s 2020 sale of its interest in Uranium Enrichment Centre JSC into the calculation of consolidated free cash flow in line with the amended dividend policy approved by the Annual General Meeting of Shareholders in May 2021.

There are no arrangements stating refusal to either dividends payment or withdrawal.
Net profit, KZT billion
Net profit for the year was KZT 220.0 billion, a decrease of 1% against 2020.
Capital expenditure of mining companies (on a 100% basis), KZT billion
A 49% YOY increase in capital expenditures of mining companies was a result of mining operations deferred from 2020 to 2021 because of a four-month COVID-19 triggered suspension of mining and development in 2020, as well as a result of higher purchase prices for raw materials, supplies, and equipment, and higher cost of drilling. Capital expenditures were lower than normal in 2020, following measures taken that year to prevent the spread of the COVID-19 pandemic.
Operating profit, KZT billion
Operating profit in 2021 was KZT 238.2 billion, an increase of 6% compared to 2020 due to an increase in average realized price.
Adjusted earnings per share, KZT/share
In 2021, the adjusted earnings per share were in line with the increase in adjusted net earnings for the year. In 2021, there was no temporary effect affecting net earnings8.
Net debt/adjusted EBITDA
In 2021, the net debt to adjusted EBITDA ratio improved by more than 100% year on year due to increased profitability, reduced debt, and higher free cash including proceeds from the sale of a non-controlling 49% interest in ME ORTALYK LLP of KZT 185,858 million, (a one-time effect). Adjusted EBITDA in 2021 was KZT 350.3 billion, up by 8% year on year. The changes resulted mainly from higher operating profit and an increase in EBITDA of JVs and associates. In 2021, attributable EBITDA reached KZT 276.5 billion, down by 6% year on year, mainly due to a sale of a 49% interest in ME ORTALYK LLP.

Sales and Distribution

SALES OF URANIUM PRODUCTS

GRI 102-4, 102-6, 102-7

COVID-19 pandemic did not affect the performance of the Company's sales commitments in 2021. Kazatomprom completed all contractual obligations to customers.

In 2021, the Company sold uranium products directly and through its Swiss trading subsidiary Trade House KazakAtom AG (THK) to 21 clients in eight countries.

Consolidated sales of Kazatomprom uranium products by region, %9

TRANSPORTATION

GRI 102-9

Kazatomprom deploys safe, secure, and reliable logistics solutions to deliver uranium products to its customers across the globe. Uranium products are shipped by rail or sea in sealed containers and physically protected by armed guards and convoys until they reach their destination. All shipments are insured against any risks associated with the transportation of uranium products.

In 2021, Kazatomprom delivered U3O8 and finished uranium products to various destinations, based on customer needs and requirements including:

Converters. The Group transported U3O8 to licensed conversion facilities owned by companies such as Honeywell (US), Cameco (Canada), and Orano Cycle (France), first by rail from the Company’s operations in Kazakhstan most commonly to the port of St. Petersburg in Russia, then by sea to various ports in the US, Canada and Europe. Afterwards, the material was moved by rail or road to processing facilities and transferred to customer’s accounts.

China. When transporting material to China, Company delivered its cargo to the Alashankou railway station near the Kazakhstan-China border.

Russia. When shipping to the Russian Federation (recipients include Siberian Chemical Combine JSC (SCC)) Company delivered its cargo by rail to the Tomsk-2 railway station in Russia.

India. Company mostly delivered U3O8 to destinations in India by rail to the port of St. Petersburg, Russia, further by sea to the port of Mumbai, India. The customer would take title at the port and organised further transportation to the final destination.

Argentina. When delivering to Argentina customer would take title at the port and organized further transportation to the final destination.

Romania. Delivery was implemented based on DDP (Delivered, Duty Paid) terms.

The average cost of shipping products to the destinations indicated in the map below ranges from USD 0.5 to USD 3.5 per kilogram of U3O8. Where practical, the Group enters swap agreements in order to minimise delivery times (the physical transportation of materials takes, on average, 100 days, while deliveries under swap agreements can take up to 25 days), reduce transportation costs, and lower risks related to the transportation of uranium products.

Development Strategy


Mission

To develop our uranium deposits and value chain components to create long-term value for all Company stakeholders in line with sustainable development principles

Vision

To become a partner of choice for the global nuclear fuel industry

DEVELOPMENT STRATEGY IMPLEMENTATION IN 2021

GRI 102-15

Implementation of the Company’s 2021-2028 Development Strategy focuses on improving operational efficiency in core activities, continuing business transformation and improving corporate governance and HR management processes. All planned activities were completed in 2021.

KEY RISKS OF STRATEGY IMPLEMENTATION10

STRATEGY IMPLEMENTATION IN 2021

GRI 102-10


Strategic goals Key results
Focus on the core business Company continued to dispose a number of non-core assets as part of the 2021-2025 Comprehensive Privatisation Plan of the Republic of Kazakhstan:
  • KazPV project companies – (Kazakhstan Solar Silicon LLP, Astana Solar LLP, MK KazSilicon LLP) sold through auction bidding on the web portal of the state property register
  • Caustic JSC – December 30, 2021, Company signed sale and purchase agreement to sell 40% of shares by direct sale to one of the shareholders of Caustic JSC in accordance with the estimated market value. Pursuant to the terms of the agreement, the sale procedure comprises 3 stages. At the time of this report’s publication, the Company owns 28% of Caustic JSC shares
  • Kazatomprom-Damu LLP was liquidated
Optimise mining, processing and sales volumes based on market conditions
  • Our production expectations remain in line with the market-oriented strategy and production in 2021 was again reduced by 20% compared to the planned production levels under subsoil use contracts
Create value through enhanced sales & marketing capabilities/ channels
  • Successful operation of THK, Kazatomprom's trader
  • Company signed contracts to supply uranium products to 2 Chinese companies
  • Company signed a framework agreement on investing in a Kazakhstan physical uranium fund, where Kazatomprom acts as a key supplier. The initial capital contributions to this fund are scheduled for March 2022
Apply best-practice business processes
  • IT security processes were enhanced at headquarters and subsidiaries
  • An automatic monitoring system for radiation hazards at Kazatomprom-SaUran LLP has been developed
  • A draft pricing methodology was elaborated for uranium products (UF6, EUP, fuel pellets, fuel assemblies, etc.) in order to increase the market share through sale of those and thus to generate revenue and net profit growth
  • Methodology for natural uranium concentrate pricing was updated to enhance the export potential of the Republic of Kazakhstan by increasing the company's competitive performance in the global uranium market
  • A system for monitoring and analysis of the centrifugal pump units’ technical condition at JV Khorasan-U LLP (vibration, pressure, temperature sensors) has been developed
  • BI-analytical tool for determining ore bodies contour was developed and implemented at JV Khorasan-U LLP, Baiken-U LLP, Semizbay-U LLP
  • BI-analytical tools based on Apache Superset open source solution for mining subsidiaries and affiliates were developed to digitize production data for the process drilling phase
Develop industry leader corporate culture
  • We have confirmed the TÜV International Certification (Germany) for compliance with international requirements and standards on health care, occupational safety and environmental management
  • In 2021, information on identified hazardous conditions, dangerous actions, and potentially dangerous situations (Near Miss) was provided on an ongoing basis and all the data was available at the eKAP information system
  • We were assigned a Corporate Governance Rating – “A”. This rating serves as an evidence of increased efficiency of our internal systems. Significant qualitative growth has been achieved in observing shareholders’ rights, the work of the Board of Directors and the Executive Body, as well as in the processes of information transparency and disclosure
  • A project to diagnose Kazatomprom’s corporate culture was launched. We have achieved the target corporate culture level set in 2017. Using the study findings a 2022-2025 roadmap for further development of our corporate culture was elaborated

Business Transformation

TRANSFORMATION PORTFOLIO

Key changes in 2021 Transformation Portfolio

2 new events and 1 project added
  • Digitisation of process drilling data
  • Updating the pricing methodology for natural uranium concentrate
  • Implementation of a tool for determining the ore bodies’ contour based on machine learning technologies
3 projects completed
  • Development of an automatic monitoring system for radiation hazardous factors
  • Implementation of the ice formation monitoring system at Uranenergo LLP
  • Monitor the implementation of the Integrated Planning System at Semizbay-U LLP and JV Inkai LLP
4 events completed
  • Modelling production processes in mining companies
  • Paper-free KAP
  • Pre-project preparations for data analysis project. Stage I
  • Updating the pricing methodology for natural uranium concentrate
One project and one event withdrawn to operations and removed from the Portfolio
  • Developing the corporate culture
  • Centralisation of “Supplier selection” process

As of December 2021, the Company's transformation portfolio consisted of:

5 projects:

3 events:

TRANSFORMATION PROGRAM IMPLEMENTATION

Key results of 2021:

As part of the Transformation Program, the Company took the following measures:

Plans under the 2022 Transformation Programme

IT ARCHITECTURE DEVELOPMENT

Key events within the scope of the Company's IT architecture development in 2021
1. 24kap.kz introduction

The Company completed the following as part of the Corporate Portal upgrade:

2. Development of prototype geophysical research system (PGRS) using artificial intelligence technologies
3. IT Service Management (ITSM) replication in subsidiaries and affiliates

Replication of three IT processes in twelve subsidiaries and affiliates. Within the framework of replication, the following processes were launched:

4. Microsoft Licence Purity
New SAP PPM, SAP GRC and SAP HCM development projects 2021
1. GRC Access Control

A key tool to ensure compliance with internal company procedures for data protection, identification of access risks and correct assignment of authority to company staff. Business unit heads became SAP modules owners.

2. SAP Project and Portfolio Management (SAP PPM)

Ensures automation of project management processes and makes project portfolio management much easier. In addition, the Company worked to migrate data to the S/4HANA platform, including integration between SAS IPS and SAP PPM, SAP PPM and SAP ERP via the BW migration to the new SAP BW/4HANA version. BW is also the data transfer intermediary from SAP ERP to the Data Warehouse.

3. SAP MDG system

SAP MDG on the S/4HANA platform was launched in May 2021. As part of the Project, the system was configured to automatically generate short and full name of the Goods, Works and Services (hereinafter referred to as “GWS”) directory using the GWS classifier, maintenance of Plan of Accounts and Primary Cost Types directories, integration with public databases, approval processes for master data requests involving business units of companies, quite simplified system interface and much more. All of this has significantly improved the quality of master data, which has a major impact on procurement, production, logistics and other Company business processes.

4. Robotisation of business processes through RPAs

Transformation team together with the interested Company's structural units developed and implemented RPA robots aimed at automation of routine operations performed by employees both of the headquarters and of the Company's subsidiaries and affiliates. Kazatomprom introduced nine solutions covering treasury, accounting, marketing, industrial safety and other processes. The main areas of robotisation are data transfer between information systems, including SAP ERP, collection and processing of information from external and internal portals, building operational reporting, reconciliation and validation of information. In 2021, we developed and implemented an internal regulatory document governing the robotisation of business processes through RPAs.

5. Geological modelling based on machine learning

As part of Kazatomprom Transformation Programme, a project for implementation of a tool for determining the orebodies contour based on machine learning technologies is in the pipeline. The purpose of this project is to model the contour of orebodies represented by a plan using machine learning and geostatistics algorithms and, as a result, to automate the geological modelling process in terms of the task being studied. As part of this project, the Company internally developed the “Contour” tool, which allows geologists to run various modelling scenarios using accumulated historical data. Together with the staff of subsidiaries and affiliates, the tool is implemented and tested within the selected perimeter.

Additional projects in 2021

Project profile Results of 2021
Corporate Portal Upgrade
The Corporate Portal is a tool for the development of corporate culture, communications between management and employees, the headquarters and subsidiaries and affiliates. Playing an important role in maintaining the Company's IR and HR brand, the portal is the most relevant and effective tool that can significantly increase employee involvement in the priorities, principles, and beliefs that guide Kazatomprom and its subsidiaries and affiliates. To this end, the Company implemented a project focused on upgrade of Kazatomprom’s “Corporate Portal” information system
  • the process of approval and signing of HR-related orders has been automated (online approval, signing and familiarization)
  • onboarding new employees is being done online now (induction trainings, signing obligations, submitting employment application form, etc.)
  • for the convenience of employees, the processes of the Nuclear Industry Trade Union were automated. Employees can apply online for fitness, health resort treatment, children's camps, as well as submit an application for financial aid
AR & VR
With AR & VR technology, a computer simulation of a three-dimensional image or complete environment is created within a defined and controlled space, with which the user can realistically interact. The goal of virtual reality is to achieve the “immersion” effect
  • a virtual mine model has been developed by digitising the mine itself and its facilities with drones assisted LiDar technology
  • seven scenarios of hazardous production situations were developed: scenarios that might occur when acid is discharged from tankers into containers; when sulphuric acid is fed from a container to the process plant; when equipment is serviced and maintained at the sulphuric acid warehouse; when a sulphuric acid tray is maintained and operated at the sulphuric acid warehouse; when a mobile container for chemical treatment at the process plant is filled with sulphuric acid; and when emergency situations are handled; as well as general safety and health care requirements in emergency situations
  • training courses for operating staff were conducted. Using special equipment and helmet, employees and contractors are visually trained and briefed on safety during maintenance and repair
IDM
The goal of IDM implementation is to increase the level of information security maturity by implementing a tool that enables centralised management of accounts and access rights in various corporate information systems System introduction solved the following tasks:
  • auditing the use of accounts in information systems
  • creating roles and authority matrixes for the staff members included in the Project perimeter
  • automating and improving the efficiency of management of access to IS and resources, and managing the user identification information
  • providing convenient and efficient tool for generating requests for granting and changing access to the IS and resources, reducing the time required to carry out routine operations by employees of organisational units and information system administrators
  • ensuring flexibility, transparency, timeliness of processes of approval, provision and revocation of access to the Company's IS and resources
IT architecture development plans 2022

The Company has extensive plans for developing the Group's IT architecture and implementing digitalisation projects. In 2022, the plans are to:

Milestones 2022

INFORMATION SECURITY

Business transformation opens up new opportunities for real-time decision-making and increasing the productivity, flexibility, and agility of the industry, while at the same time requires special attention to ensuring information security, cyber resilience and business continuity of information systems.

In order to ensure an appropriate level of cybersecurity, Kazatomprom continuously monitors compliance with information security requirements and strives to develop an information security management system in accordance with the laws of the Republic of Kazakhstan and ISO/IEC 27001.

The Company continues to bring to action the Implementation and Development of Cybersecurity Project as part of the Action Plan for the execution of “Establishment of an Integrated Information Security Management System” mechanism under strategic objective on “Digitalisation and Transformation” to achieve the “Apply best practices in business activities” strategic goal as per the 2018-2028 Kazatomprom Development Strategy. Kazatomprom ensures roundthe- clock monitoring and response to information security incidents, and actively interacts with the Digital Security Service and the National Coordination Centre for Information Security. In order to improve and enhance the cyber culture and cyber hygiene in the Group, online training, cyber training sessions and special induction trainings are conducted on an ongoing basis.

In 2021, Kazatomprom and its subsidiaries and affiliates, as well as jointly controlled entities recorded 1,255 IS incidents, of which 67 were high-priority; 524, medium-priority; 664, low-priority, and 0 incident causing financial damage to the Company (1,000+ MCI (monthly calculated indicator)).

To raise awareness on information protection among employees, as well as to inform them about changes in internal documents governing the information security requirements in 2021, an interactive online training for top managers of subsidiaries and affiliates and line managers of the headquarters, and a thematic course for all employees of Kazatomprom were conducted.

As part of the intent on cooperation agreements in information security, the Company works to improve cyber hygiene and digital security, and to ensure participation in forums and meetings to discuss the digitalisation of the nuclear industry and plans for IT and IS systems development, both during the pandemic and in the post-quarantine period.

Information security development plans for 2022:

Kazatomprom will continue to monitor compliance with information security requirements in all existing and developing IT systems, as well as carry out activities to improve cybersecurity and information security awareness among its employees.

In addition, the Company intends to:

Association Membership and International Compliance

GRI 102-12, 102-13
Professional nuclear power organisations

World Nuclear Association, London, UK

www.world-nuclear.org
Member since 1993

Tantalum-Niobium International Study Center, Brussels, Belgium

www.tanb.org
Member since 1999

World Nuclear Fuel Market, Norcross, GA, United States

www.wnfm.com
Member since 2002

Nuclear Energy Institute, Washington, D.C.

www.nei.org
Member since 2018

World Nuclear Transport Institute, London, UK

www.wnti.co.uk
Member since 2019
National sectoral organisations

Nuclear Society of Kazakhstan, Nur-Sultan, Kazakhstan

www.nuclear.kz
Member since 2002

Association Of Legal Entities “Republican Association Of Mining And Metallurgical Enterprises” (AMME), Nur-Sultan, Kazakhstan

www.agmp.kz
Member since 2006

KAZENERGY Kazakhstan Association of Oil&Gas and Energy Sector Organisations, Nur-Sultan, Kazakhstan

www.kazenergy.com
Member since 2009

Atameken National Chamber of Entrepreneurs of Kazakhstan, Nur-Sultan, Kazakhstan

www.atameken.kz
Member since 2013
MINING ASSETS
ME ORTALYK LLP
Subsidiary

Company owns a 51% interest in the authorized capital of ME ORTALYK LLP (China National Nuclear Energy Group owns 49%). The LLP operates at the central block of the Mynkuduk deposit and at the Zhalpak deposit in the Suzak District of Turkistan Region.

Deposit

The Mynkuduk deposit was discovered in 1973, and the commercial operation of the central block began in 2008. A subsoil use contract to develop the Central Mynkuduk deposit block was concluded on 8 July 2005. The rights to the exploration, production and marketing of uranium are valid until 2043.

Pilot production was conducted at the Zhalpak deposit. The exploration contract was concluded on 14 December 2021. In the event of successful production, full-scale production will begin in 2042.

As of 31 December 2021, the total volume of ore reserves of the deposits (including annual depletion) was 37,200 tonnes. Total mineral resources (including reserves) stood at 37,200 tonnes.

FEATURES
Year of creation
2011
Production
1,579 tonnes
Location
Republic of Kazakhstan, Turkistan Region, Suzak District
Number of employees
471
CEO
Zhumagali Dzhumataevich Markenbayev
Date of the subsoil use contracts
2000-2043
Group’s ownership interest
51%
Deposit
1. Mynkuduk, central block
2. Zhalpak
RU-6 LLP
Subsidiary

Company is the only participant at RU-6 LLP.

In November 2018, Company transferred to RU-6 LLP its rights and obligations under a subsoil use contract to develop the North Karamurun and South Karamurun deposits in the Shieli District of Kyzylorda Region.

Deposit

The North Karamurun and South Karamurun deposits were discovered in 1979, and commercial operation began in 1997.

A subsoil use contract to develop the North Karamurun and South Karamurun deposits was concluded on 27 November 1996. The rights to the exploration, production, and marketing of uranium are valid until 27 November 202213.

As at 31 December 2020, the total amount of ore reserves in the deposits (including annual depletion) was 13,500 tonnes of uranium. Total mineral resources (including reserves) stood at 13,500 tonnes of uranium.

FEATURES
Year of creation
1983
Production
800 tonnes
Location
Republic of Kazakhstan, Kyzylorda Region, Shieli District
Number of employees
432
CEO
Iskakov Daurzhan
Date of the subsoil use contracts
1996–2022
Group’s ownership interest
100%
Deposit
1. North Karamurun
2. South Karamurun
KAZATOMPROM-SAURAN LLP
Subsidiary

Company is the only participant at Kazatomprom-SaUran LLP.

In November 2018, Company transferred to Kazatomprom- SaUran LLP its rights and obligations under subsoil use contracts for the Kanzhugan deposit, the south part of block No. 1 (South) and the north part of block No. 3 (Central) of the Moinkum deposit, the Vostochny block of the Mynkuduk deposit and the Uvanas deposit, together with related manufacturing assets.

Deposit

The Kanzhugan deposit was discovered in 1972, commercial operation began in 1997. A subsoil use contract to develop the Kanzhugan deposit was concluded on 27 November 1996. The rights to the exploration, production, and sale of uranium are valid until 15 November 202211.

The south part of block No. 1 (South) of the Moinkum deposit was discovered in 1976, the north part of block No. 3 (Central) in 1974. Commercial operation of the southern part of block No. 1 began in 1997, and the northern part of block No. 3 in 2017.

A subsoil use contract for the south part of block No. 1 (South) was concluded on 26 September 2000. The rights to the extraction, exploration, and sale of uranium are valid until 26 September 2021.

A subsoil use contract for the north part of block No. 3 (Central) was concluded on 31 May 2010. The rights to the extraction, exploration, and sale of uranium are valid until 31 May 2041.

The Uvanas deposit was discovered in 1963, and commercial operation began in 1997. A subsoil use contract to develop the Uvanas block was concluded on 27 November 1996. The rights to the exploration, production, and sale of uranium to be valid until 15 November 2022.

The Mynkuduk deposit was discovered in 1973, and commercial operation of the Vostochny block began in 1997. A subsoil use contract to develop the Vostochny block of the Mynkudyk deposit was concluded on 27 November 1996. The rights to the exploration, production, and sale of uranium are valid until 15 November 2022.

Currently, uranium mining in the southern part of block No. 1 (South) of the Moinkum deposit and the Uvanas deposit has been suspended due, to a depletion of reserves. Work is underway to return the territories to the state.

As of 31 December 2021, the total volume of ore reserves of deposits (including annual depletion) was 23,100 tonnes of uranium. Total mineral resources (including reserves) stood at 25,300 tonnes of uranium.

FEATURES
Year of creation
2015
Production
1,493 tonnes
Location
Republic of Kazakhstan, Turkistan Region, Suzak District
Number of employees
952
CEO
Askar Nurgaliyev12
Date of the subsoil use contracts
1996–2041
Group’s ownership interest
100%
Deposit
1. Kanzhugan (including the Kainarsky block)
2. Moinkum, block No. 1 (South), the southern part
3. Moinkum, block No. 3 (Central), northern part
4. Uvanas
5. Mynkuduk, East block
APPAK LLP
Subsidiary

Company holds a 65% interest in the charter capital of APPAK LLP (Sumitomo Corporation holds 25%, Kansai Electric Power Co., Inc. holds 10%).

The joint venture operates in the Western block of the Mynkuduk deposit in the Suzak District of Turkistan Region.

Deposit

The Mynkuduk deposit was discovered in 1973, commercial operation of the Zapadnoye block began in 2008.

A subsoil use contract was signed on 8 July 2005 to develop the Zapadnoye block of the Mynkuduk deposit. The rights to the exploration, production, and marketing of uranium are valid until 8 July 2035.

As of 31 December 2021, the total amount of ore reserves in the deposits (including annual depletion) was 16,300 tonnes of uranium. Total mineral resources (including reserves) stood at 16,300 tonnes of uranium.

FEATURES
Year of creation
2005
Production
805 tonnes
Location
Republic of Kazakhstan, Turkistan Region, Suzak District
Number of employees
329
CEO
Darkhan Abdimoldayev14
Date of the subsoil use contracts
2005–2035
Group’s ownership interest
65%
Deposit
West Mynkuduk
JV INKAI LLP
Subsidiary

Company owns a 60% interest in the charter capital of JV Inkai LLP (Cameco holds 40%).

The joint venture operates at block No. 1 of the Inkai deposit in the Suzak District of Turkistan Region.

Deposit

The Inkai deposit was discovered in 1976 and testing of block No. 1 began in 2002.

A subsoil use contract was signed on 13 July 2000 to develop the Inkai deposit, block No. 1. The rights to the exploration, production, and marketing of uranium are valid until 13 July 2045.

As of 31 December 2021, the total volume of ore reserves of deposits (including annual depletion) was 131,300 tonnes of uranium. Total mineral resources (including reserves) stood at 151,800 tonnes of uranium.

FEATURES
Year of creation
1996
Production
3,449 tonnes
Location
Republic of Kazakhstan, Turkistan Region, Suzak District
Number of employees
723
CEO
Elnar Kairatuly Pernesh
Date of the subsoil use contracts
2000–2045
Group’s ownership interest
60%
Deposit
Inkai, block No. 1
BAIKEN-U LLP
Subsidiary

Baiken-U LLP is owned 52.5% by the Company, with a direct share of 5% and 47.5% through EnergyAsia (BVI) Limited.

The joint venture operates at the Kharasan-2 block of the North Kharasan deposit in the Zhanakorgan District of Kyzylorda Region.

The deposit is the deepest uranium deposit in Kazakhstan mined using the ISR method

Deposit

The North Kharasan deposit was discovered in 1972, and commercial operation of the block began in 2010.

A subsoil use contract to develop the Kharasan-2 block of the North Kharasan deposit was concluded on 1 March 2006. The rights to the exploration, production, and marketing of uranium are valid until 1 March 2058.

As of 31 December 2021, the total volume of ore reserves of the deposits (including annual depletion) was 17,000 tonnes. Total mineral resources (including reserves) stood at 17,000 tonnes.

FEATURES
Year of creation
2006
Production
1,230 tonnes
Location
Republic of Kazakhstan, Kyzylorda Region, Zhanakorgan district
Number of employees
458
CEO
Nursultan Ondasyn Ondasynuly15
Date of the subsoil use contracts
2006–2058
Group’s ownership interest
52.5%
Deposit
North Kharasan, Kharasan-2 block
SEMIZBAI-U LLP
Joint venture

Company holds a 51% interest in the charter capital of Semizbai-U LLP (Chinese National Nuclear Power Group holds 49%).

The joint venture operates at the Irkol deposit in the Shielinsky District of Kyzylorda Region and at the Semizbai deposit in the Birzhan Sal district of Akmola Region.

Deposit

The Irkol deposit was discovered in 1976, commercial operation began in 2008. A subsoil use contract to develop the Irkol deposit was concluded on 14 July 2005. The rights to the exploration, production, and marketing of uranium are valid until 4 March 2030.

The Semizbai deposit was discovered in 1973, commercial operation began in 2009. A subsoil use contract to develop the Semizbai deposit was concluded on 2 June 2006. The rights to the exploration, production, and sale of uranium are valid until 2 June 2031.

As of 31 December 2021, the total amount of ore reserves in the deposits (including annual depletion) was 24,200 tonnes of uranium. Total mineral resources (including reserves) stood at 24,200 tonnes of uranium.

FEATURES
Year of creation
2006
Production
962 tonnes
Location
Republic of Kazakhstan, Kyzylorda Region, Shielinsky District and Akmola Region, Birzhan Sal district
Number of employees
513
CEO
Zeryhan Mukanov16
Date of the subsoil use contracts
2005–2030
Group’s ownership interest
51%
Deposit
1. Irkol
2. Semizbai
KARATAU LLP
Joint operations

Company and Uranium One Netherlands B.V. (part of Rosatom Group) each hold a 50% interest in the charter capital of Karatau LLP.

The LLP operates at block No. 2 of the Budenovskoye deposit in the Suzak District of Turkistan Region.

Deposit

The Budenovskoye deposit was discovered in 1979, and the commercial operation of block No 2 began in 2008.

A subsoil use contract was signed on 8 July 2005 to develop block No. 2 of the Budenovskoye deposit. The rights to the exploration, production, and marketing of uranium are valid until 8 July 2040.

As of 31 December 2021, the total amount of ore reserves in the deposits (including annual depletion) was 38,700 tonnes of uranium. Total mineral resources (including reserves) stood at 38,700 tonnes of uranium.

FEATURES
Year of creation
2005
Production
2,561 tonnes
Location
Republic of Kazakhstan, Turkistan Region, Suzak District
Number of employees
532
CEO
Saken Kalibekov17
Date of the subsoil use contracts
2005–2040
Group’s ownership interest
50%
Deposit
Budenovskoye, block No. 2
Subsidiary
Subsidiary

Company holds a 50% interest in the charter capital of JV Khorasan-U LLP (Uranium One Utrecht B.V. (part of Rosatom group) holds 30%, Energy Asia Holdings Ltd holds 20%).

The JV operates at the Khorasan-1 block of the North Khorasan deposit in the Zhanakorgan district of Kyzylorda Region.

Deposit

The North Khorasan deposit was discovered in 1972, and commercial operation of the Kharasan-1 block began in 2008.

A subsoil use contract to develop the Khorasan-1 block of the North Khorasan deposit was concluded on 8 July 2005. The rights to the exploration, production, and sale of uranium are valid until 8 July 2058.

As of 31 December 2021, the total amount of ore reserves in the deposits (including annual depletion) was 36,600 tonnes of uranium. Total mineral resources (including reserves) stood at 36,600 tonnes of uranium.

FEATURES
Year of creation
2014
Production
1,579 tonnes
Location
Republic of Kazakhstan, Kyzylorda Region, Zhanakorgan district
Number of employees
11
CEO
Adai Esirkepovich Umirbekov
Date of the subsoil use contracts
2005–2058
Group’s ownership interest
50%
Deposit
North Kharasan, Kharasan-1 block
JV AKBASTAU JSC
Joint operations

Kazatomprom and Uranium One Amsterdam B.V. (Part of Rosatom Group) each hold a 50% interest in JV Akbastau JSC.

The JSC operates at blocks No. 1, No. 3 and No. 4 of the Budenovskoye deposit in the Suzak District of Turkistan Region.

Deposit

The Budenovskoye deposit was discovered in 1976 and commercial operation of blocks No. 1, No. 3, and No. 4 began in 2012.

Subsoil use contracts to develop blocks No. 1, No. 3 and No. 4 of the Budenovskoye deposit were concluded on 20 November 2007. The rights to the exploration, production, and marketing of uranium in area No. 1 are valid until 20 November 2037, and in blocks No. 3 and No. 4 until 20 November 2038.

As of 31 December 2021, the total volume of ore reserves of the deposits (including annual depletion) was 37,900 tonnes. Total mineral resources (including reserves) stood at 37,900 tonnes.

FEATURES
Year of creation
2006
Production
1,545 tonnes
Location
Republic of Kazakhstan, Turkistan Region, Suzak District
Number of employees
49
CEO
Bakhtiyar Kulmanovich Amirov
Date of the subsoil use contracts
2007–2038
Group’s ownership interest
50%
Deposit
Budenovskoye, blocks No. 1, No. 3, No. 4
JV ZARECHNOYE JSC
Associate

Company and Uranium One Holland B.V. (part of the Rosatom group) each own 49.98% of the shares of JV ZARECHNOYE JSC, and Karabaltinsky Mining Plant JSC owns 0.04%.

The joint venture operates in the Zarechnoye deposit in the Otyrar district of Turkistan Region.

Deposit

The Zarechnoye deposit was discovered in 1977, and commercial operation of the deposit began in 2007.

A subsoil use contract to develop the Zarechnoye deposit was concluded on 23 September 2002. The rights to the exploration, production, and marketing of uranium are valid until 23 September 2025.

As of 31 December 2021, the total amount of ore reserves in the deposits (including annual depletion) was 5,200 tonnes of uranium. Total mineral resources (including reserves) stood at 5,800 tonnes of uranium.

FEATURES
Year of creation
2001
Production
655
Location
Republic of Kazakhstan, Turkistan Region, Otyrar District
Number of employees
361
CEO
Zhandos Nurlanovich Bekbaev
Date of the subsoil use contracts
2002–2025
Group’s ownership interest
49.98%
Deposit
Zarechnoye
JV KATCO LLP
Joint venture

Company holds a 49% interest in the charter capital of JV Katco LLP, (Orano (formerly AREVA) holds 51%).

The joint venture operates in the northern part of block No.1 (South) and at block No. 2 (Tortkuduk) of the Moinkum deposit in the Suzak District of Turkistan Region.

In April 2017, the Company and Orano concluded an agreement under which 60% of the profit distributed by the joint venture is due to the Company from 2022.

Deposit

The Moinkum deposit was discovered in 1976, the commercial operation of block №1 began in 2001.

A subsoil use contract to develop the northern part of block No. 1 (South) and block No. 2 (Tortkuduk) of the Moinkum deposit was concluded on 3 March 2000. The rights to the exploration, production, and sale of uranium are valid until 4 March 2039.

As of 31 December 2021, the total volume of the ore reserves of deposits (including annual depletion) was 52,400 tonnes of uranium. Total mineral resources (including reserves) stood at 54,900 tonnes of uranium.

FEATURES
Year of creation
1996
Production
2,840 tonnes
Location
Republic of Kazakhstan, Turkistan Region
Number of employees
1 256
CEO
Pascal Bastien18
Date of the subsoil use contracts
2000–2039
Group’s ownership interest
49%
Deposit
1. Moinkum, block No. 1 (South), the northern part
2. Moinkum, block No. 2 (Tortkuduk)
JV SOUTHERN MINING AND CHEMICAL COMPANY LLP
Associated Organization

Company holds a 30% interest in the charter capital of JV Southern Mining and Chemical Company LLP (Uranium One Rotterdam B.V. (part of Rosatom Group) holds 70%).

The joint venture operates at the Akdala deposit and at block No. 3 of the Inkai deposit in the Suzak District of Turkistan Region.

Deposit

The Akdala deposit was discovered in 1982, and commercial operation began in 2004. A subsoil use contract to develop the Akdala deposit was concluded on 28 March 2001. The rights to the extraction, exploration, and sale of uranium are valid until 28 March 2026.

The Inkai deposit was discovered in 1976, and commercial operation of block No. 4 began in 2007. A subsoil use contract was signed on 8 July 2005 to develop block No. 4 of the Inkai deposit. The rights to the exploration, production and sale of uranium are valid until 8 July 2029.

As of 31 December 2021, the total amount of ore reserves in the deposits (including annual depletion) was 77,900 tonnes of uranium. Total mineral resources (including reserves) stood at 80,000 tonnes of uranium.

FEATURES
Year of creation
2014
Production
2 321
Location
Republic of Kazakhstan, Turkistan Region, Suzak District
Number of employees
846
CEO
Erlan Lesbekovich Tashimov
Date of the subsoil use contracts
2001–2029
Group’s ownership interest
30%
Deposit
1. Akdala
2. Inkai, block No.4
JV BUDENOVSKOYE LLP
Associated Organization

Company holds a 51% interest in the charter capital of JV Budenovskoye LLP (Limited Liability Partnership Stepnogorsk Mining and Chemical Combine holds 49%).

The joint venture operates at block No. 6 and 7 of the Budenovskoye deposit in the Suzak District of Turkistan Region.

Deposit

The Budenovskoye deposit was discovered in 1982, and commercial operation of block No. 6 and 7 is planned in 2022.

As of 31 December 2021, the total amount of ore reserves in the deposits (including annual depletion) was 114,200 tonnes of uranium. Total mineral resources (including reserves) stood at 114,200 tonnes of uranium.

FEATURES
Year of creation
2016
Production
-
Location
Republic of Kazakhstan, Turkistan Region, Suzak District
Number of employees
42
CEO
Medeo Rustam
Date of the subsoil use contracts
2020–2045
Group’s ownership interest
51%
Deposit
Budenovskoye, block No. 6, 7