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Namibia’s ambitions of riding the rising tide of the global uranium market might be dampened by a familiar foe – water. The Bank of Namibia (BoN) has cast a shadow over the industry’s jubilant growth, predicting a significant slowdown in 2024 due to water supply constraints.
This comes as a sobering blow after a stellar year for uranium mining in Namibia. The sector, a significant contributor to the national GDP (N$4.7 billion in 2023), experienced a robust 24.5% growth in 2023. However, Governor Johannes !Gawaxab of the BoN painted a less optimistic picture for the year ahead.
“Despite the surge in uranium prices, water supply interruptions are expected to result in uranium mines adjusting production downwards,” !Gawaxab remarked in the Bank’s latest economic outlook update for March 2024.
This isn’t the first time water scarcity has threatened Namibia’s mining ambitions. The country is grappling with the effects of a prolonged drought, leading to dwindling supplies at crucial sources like the Omaruru Delta aquifer. Mines are being forced to adapt, with some anticipating “stripping activities” – a process that removes waste rock to expose more uranium ore – further impacting output.
The slowdown isn’t solely due to water woes. The BoN report also highlights “production adjustments at mines” as a contributing factor. These adjustments could be due to various reasons, including planned maintenance or strategic decisions based on market conditions.
While uranium faces a cloudy outlook, the news isn’t all bad for Namibia’s mining sector. Diamond production, however, is anticipated to decline due to a combination of low international prices and dwindling reserves.
The Bank of Namibia’s forecast serves as a cautionary tale for Namibia’s uranium boom. While the global market presents exciting opportunities, the nation’s growth hinges on overcoming its water challenges. Finding sustainable water solutions will be critical to ensure Namibia’s nuclear ambitions don’t run dry.
