Areva - Reference Document 2016

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BUSINESS OVERVIEW

6.4 Operations

Operations and highlights Key events in 2016 in the Mining Business Unit were as follows:

The first phases of exploration consist of detecting surface or subterranean mineral indices using aerial or ground geophysics (gravimetry, electromagnetics, radiometry) as well as surface geological surveys. AREVA selects targets for their promising geological history. This is followed by test drilling which, if the results are positive, is used to develop an initial estimate of the deposit’s resources. Once the attractiveness of the deposit has been confirmed, the drilling grid is tightened to refine the estimate of resources and confirm their mining feasibility, both technically and economically. This work, which requires an exploration permit that eventually confers mining rights, take an average of 10 to 15 years. Once the technical and economic feasibility of mining projects has been demonstrated, mining facilities are built and uranium ore is mined in an open pit, an underground mine, or by in-situ recovery (see Glossary) , depending on the characteristics of the deposit. p Whether for open pit or underground mines, the extracted ore is milled and leached, usually with acidic solutions. Leaching may be static (heap leaching) or dynamic. In the processing plant, the uranium is extracted from the resulting solutions using solvent extraction techniques or by fixation on ion exchange resins. The purified uranium is then precipitated and dried to produce a uranium concentrate called “yellowcake”. This product is packaged and shipped to the conversion plant of the customer’s choice. p The in-situ recovery technique is used when the confinement and permeability properties of the deposit allow the uranium to be dissolved directly in the ground. In that case, oxidizing solutions are pumped into the ore bed between injection wells and producing wells. The resulting solution is pumped to the surface and processed in the same manner as for open pit or underground mines. Mining rehabilitation is an important activity that calls for specific mining and civil engineering techniques and involves many areas of expertise. The purpose of this activity is to minimize the residual environmental impacts of the mining sites with a view to sustainable development. The environmental impacts of mining operations must be monitored and limited throughout the development and production cycle.

p in April, Katco produced its 30,000 th metric ton of uranium. Its operations began in 2004 and reached 4,000 metric tons of uranium per year starting in 2013; p in June, AREVA received the regulatory permit from the Canadian government to increase the production of uranium concentrates at the McClean Lake mill up to 24 million pounds of U 3 O 8 ; p in July, AREVA was authorized to transfer the mining licenses from Cogegobi to the operating company AREVAMines LLC. The process for activating the AREVA Mines LLC joint venture, enabling the transfer of 34% of the state company Mon-Atom, is in progress; p in July, AREVApublished its ResponsibleGrowthReport for themining operations on a dedicated website for the second time (http://www.rse-mines.areva.com). This report is audited by an independent third party to confirm AREVA Mines’ alignment with the guidelines of the International Council on Mining and Metals (ICMM), including the ten sustainable development principles. It also meets the standards of the Global Reporting Initiative (GRI), an internationally recognized non-financial reporting benchmark. The Cigar Lake mine in Canada confirmed its ramp-up this year, ahead of forecasts, with 17 million pounds of uranium concentrates produced in 2016. Good progress was also made in 2016 on the competitiveness plan set up in early 2015 to cope with the deteriorated market conditions. By controlling its production costs and the level of its capital expenditure, theMining business maintained good operating and financial performance in 2016, despite a context of falling prices. In 2016, AREVA produced 8,432 metric tons of uranium in AREVA’s equity share, corresponding to 10,739 metric tons of uranium in financial consolidation share: p Somaïr produced 2,164 metric tons of uranium (on a 100% basis) (AREVA’s share: 63.4%); p Cominak produced 1,313 metric tons of uranium (on a 100% basis) (AREVA’s share: 34%); p Katco produced 4,002 metric tons of uranium (on a 100% basis) (AREVA’s share: 51%); p McArthur River/Key Lake produced 6,944 metric tons of uranium (on a 100% basis) (AREVA’s share: 30.2%); p Cigar Lake produced 6,665 metric tons of uranium (on a 100% basis) (AREVA’s share: 37.1%).

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2016 AREVA REFERENCE DOCUMENT