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. Last Updated: 07/27/2016

Russia, Kazakhstan Sign Nuclear Deal

Russia and Kazakhstan signed off Tuesday on three joint ventures in the nuclear sector, with a focus on uranium mining and enrichment and on the development of new atomic reactors.

The deal marks a compromise between the two sides, lending Russian high-tech know-how to Kazakhstan's nuclear-energy ambitions in return for plugging the deficit in Moscow's uranium needs, experts said.

"Dreams of an integrated technology chain like that of Minsredmash" -- the Soviet-era nuclear ministry -- "are now a reality," Sergei Kiriyenko, head of the Federal Atomic Energy Agency, said Tuesday during a working visit to Aktau, a town on Kazakhstan's Caspian Sea.

In January, President Vladimir Putin forged a nuclear alliance with counterparts from Ukraine and Kazakhstan. Putin welcomed Uzbekistan into the alliance later that month. Russia aims to boost cooperation with its CIS neighbors to secure access to nuclear facilities that were scattered after the Soviet collapse.

Under the newly signed venture memorandums, state nuclear fuel trader Tenex will work with Kazhakstan's state-controlled Kazatomprom to mine the Budyonovskoye uranium deposit. A second joint venture would then process the mined ore, which in enriched form is used as fuel for nuclear reactors.

Kazakhstan has 17 percent of the world's uranium reserves, with Kazatomprom holding the world's second-largest reserves, said Mikhail Stiskin, a Troika Dialog analyst.

Russia currently mines just 35 percent of its uranium needs, he said. This year mining will also begin at Kazakhstan's Zarechnoye deposit, in which Russia has a 49 percent stake and a $1 billion contract to receive 1,000 tons of uranium per year.

The third of the newly created joint ventures will develop a reactor along the lines of the small BVER-300 fast-neutron reactor. "We will be able to build this kind of reactor in Kazakhstan and Russia," and promote it on the global market, Kiriyenko said.

"Kazakhstan wants to break into the high-tech club of nations, and a reactor like the BVER-300 would perfectly suit a large country with a small, dispersed population," said Alexander Pikayev, a nuclear expert at the Institute of World Economics and International Relations.