Uranium jerky: The strange path through a decade of peculiar developments – Part I

Uranium jerky: The strange path through a decade of peculiar developments – Part I
Processing uranium yellowcake. Image: Orano via IAEA

Back in early 2010, I took note of an interesting milestone in the Iranian nuclear program.  Iran had, to all appearances, recently achieved the ability to sustain her program and move it forward using uranium newly sourced from her own mining operations.

The Iranians had claimed, shortly before my February 2010 article, that they were indeed converting and enriching their own uranium, and were no longer relying on a supply purchased from a South African company in the 1970s, when the Shah was still in power.

At the time, one of my chief concerns was that the accompanying shift in feedstocks to the uranium conversion facility at Esfahan could have been cover for funneling some of Iran’s uranium processing activities into underground chambers.  Iran gaining a new, ongoing feedstock meant that the IAEA had perforce to lose accountability on how much uranium was flowing through Iran’s fuel cycle.  The Iranian mines were not subject to monitoring, so the first accountability touchstone for IAEA occurred when the uranium came in the door at Esfahan.

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That was too late for a full accounting.  Between mid-2008 and late 2009, it became impossible for IAEA to be certain whether any uranium was being diverted or not.  Underground facilities that had clearly been excavated at both Esfahan (conversion) and Natanz (enrichment), based on satellite imagery from years before, went uninspected.  Tunnels dug at Esfahan had been visited by IAEA in 2004, but the tunnels at Natanz have never been inspected, and the 2004 visit at Esfahan was the last one.

Compounding the evidence about Iran’s new mining and milling was an abrupt drop in both uranium conversion and uranium enrichment during the same period in 2008 and 2009.  By the end of 2009 both processes were in recovery, with a climb in capacity continuing in the following months.  But with all of the indicators seeming to go out of phase, so to speak, in the very same timeframe, it looked like something significant had happened.

Iranian media showcase the Saghand uranium mine in 2014. Via YouTube

I ended up calling this period the “Uranium Jerk.”  It seemed to be connected to some subsequent developments as well, although the enduring significance of those developments is uncertain.

It is in hindsight, however, and with a substantially broader view of the decade from 2005 to 2015, that Iran’s Uranium Jerk and other events appear to take on an intriguing but as yet unclarified significance.

A handful of other developments, with odd connections on their margins, were startlingly (even freakishly) contemporaneous with the Iranian Uranium Jerk.  One of them American newshounds are already familiar with.  The period 2008-2009 is when the FBI had an informant providing reports on alleged bribes going to the Clintons from inside the U.S. subsidiary (Tenam) of Russia’s state uranium enterprise (Rosatom).

It was in the wake of this period – i.e., in 2009 and 2010 – that Hillary Clinton was the U.S. Secretary of State and Russia’s Rosatom subsidiary ARMZ applied to purchase controlling interest in the Canadian company Uranium One, which held major mining concessions in the United States.

Another contemporaneous drama was one hardly anyone is aware of today.  The short summary on it – which we’ll expand a bit below – is that Goldman Sachs, taking advantage of a dubious loophole in financial-house regulations, bought up nearly a million pounds of physical uranium in a convoluted series of deals that took place in 2008 and 2009.

Goldman Sachs didn’t just buy the uranium (in the form of yellowcake).  As part of the 2009 deal, the company purchased – and entirely took over – the uranium trading firm Nufcor, which at the time was the sole marketing agent for Uranium One.

The uranium purchase, a huge one that got considerable notice in the industry media at the time, made Goldman Sachs a very large holder of uranium yellowcake.  Buying Nufcor put Goldman in the uranium trading market, and of course, Goldman was already in the commodities speculation market for uranium.  Somehow, Goldman Sachs got away with this for several years afterward, until Congress began demanding some answers as to what was going on.

But now, in 2020, one of the main things we’re interested in is that connection to Uranium One.  We’re not uninterested, for that matter, in the part where Goldman had under its control 900,000 pounds of uranium yellowcake (which eventually became a lot more).

Uranium yellowcake. New Mexico Bureau of Geology and Mineral Resources

A third drama occurring in this exact same period was that of the mysterious cargo ship M/V Arctic Sea, which readers may recall was supposed to have been hijacked in the Baltic Sea, and went missing for weeks in July and August of 2009 during a transit from Finland to Algeria, ostensibly with nothing but a load of Finland’s finest timber.

There is quite a bit of detail to sort through in the saga of Arctic Sea.  We can’t hope to compass it all here, although we’ll take a look at some highlights.  What makes it of interest, aside from the timing of the event, is a handful of the story’s features.

These include the fact that the ship was insured by the insurance arm of Renaissance Capital – yes, that Renaissance Capital, the one that paid Bill Clinton $500,000 for a speech in 2010 just before Hillary signed off on the Uranium One deal; the bizarre detail that Russia wanted an Interpol Red Notice issued on the chief of Estonia’s intelligence service, claiming that he was behind the supposed “hijacking” of Arctic Sea; and the truly spectacular coincidence that the Russian navy announced it had located the rogue Arctic Sea near the Cape Verde Islands on 14 August 2009, the one day in history when U.S. Secretary of State Hillary Clinton was in the Cape Verde Islands for a brief official visit.

The explicit potential that this weird episode had something to do with uranium is not missing.  Nothing ever came of these details in official channels, largely because Russia had physical custody of the ship after mid-August 2009.  But Artic Sea had undergone interior modifications in Kaliningrad just a few weeks prior to her departure on the voyage to Algeria.  And there were reportedly indications – never confirmed (or apparently pursued) – of radioactive material on Arctic Sea before she left the Finnish port in July 2009.

One more development should be mentioned, although it is harder to see it as a single event or episode.  It culminated in the abrupt “purge” in Kazakhstan, in 2009, of two oligarchs who had been instrumental in arranging the uranium (and other mining) deals with Frank Giustra in the mid-2000s, at least one of which is thought to have involved Bill Clinton.  The Kazakh oligarchs were Mukhtar Dzhakishev, head of Kazatomprom, who was removed from that position in May 2009 and subsequently charged with embezzlement, and Mukhtar Ablyazov (see link below), head of the national bank, BTA, who fled the country in February 2009 ahead of similar charges.

The special interest of this side drama is not just its connection to Giustra and Clinton, and hence indirectly to Uranium One.  (In that regard it bespeaks, in my view, an effort by Vladimir Putin to reclaim decisive leverage over the natural resources of Central Asia, which outside interlopers like Giustra had been making raids on since the collapse of the Soviet Union in early 1992.  The timing of the moves in Kazakhstan, immediately after Barack Obama’s inauguration, can’t fail to be of interest here.)

But as noted in a previous article, Mukhtar Ablyazov is also linked to Stephan Roh, the Switzerland-based lawyer for Joseph Mifsud, who formed a number of companies for Ablyazov during the period (2005-2007) when the Kazakh oligarch and politician was making Giustra- and Clinton-involved mining deals.

And the Roh connection leads to the Ireland-based shell company Vinkins Holdings Limited, which changed its name from Severnvale Nuclear Trading in March 2008 – the beginning of our period of interest – and is linked to Russian companies run by Roh associate Alexei Klishin, a Kremlin-connected Russian lawyer and businessman.  The Klishin link is a springboard to the Russian energy services industry, including, most interestingly, the company formerly called Khimprom (now part of Tenex, the Rosatom subsidiary), which manufactures gas centrifuges for uranium enrichment, and its one-time owner, Clinton donor Viktor Vekselberg.

Alexey Klishin (standing) appears at a Link Campus U. even in December 2016 with LCU’ Vicenzo Scotti, Joseph Mifsud, and Stephan Roh (far R)

The odds are very low that all these events, with their interlinked personalities and interests, could occur in the same timeframe and not be related.  As we will see, expanding the timeline just a few years on either side, and considering other developments in the nuclear power and uranium industries, sheds light that makes the concatenation of occurrences even more interesting.

We’ll develop that larger narrative later.  Meanwhile, let us look at two of the development threads in 2008 and 2009 – the Goldman Sachs saga and M/V Arctic Sea – in a bit more detail.

Goldman Sachs goes all in on physical commodities

Much of the information in this tale comes from the report of a 2014 Senate investigation into what the heck – not to put too fine a point on it – Goldman Sachs was doing owning physical minerals, including uranium; trading in physical minerals; and speculating on the trade in minerals, all under the same roof.  Indeed, when Goldman first jumped into this venture, the firm also bought shares in power companies and other energy enterprises, which were customers of the commodities (e.g., coal and uranium) Goldman was holding, trading, and speculating on.

At the outset, it can’t fail to be of interest that Goldman Sachs announced its entry into commodities holding and trading on the fascinating date of 20 January 2009; i.e., Barack Obama’s inauguration day.  As the Senate report makes clear, it was a dubious reading of a “grandfather clause” loophole in U.S. regulations governing financial-company operations that Goldman invoked as its authority to make this foray.  One gets the sense that the company was waiting for the departing Bush administration to be out the door before making its announcement.

Obama’s inauguration on 20 Jan 2009. U..S. Presidential Inauguration video, YouTube

But the preparations for the venture were in the works somewhat earlier.  Justifying physical commodity ownership as a form of investment was done via the construct of holding the commodities and selling them at the most profitable time – a procedure for which gaining market power by holding a lot of a commodity would have obvious advantages.  Commodities-market media wrote this up as a reflection of the growing influence in Goldman’s senior ranks of executives from a subsidiary, boutique commodities trader J. Aron & Company, which Goldman had taken over in the 1980s.

The Senate report’s account of Goldman’s decision process can be found in the discussion on pp. 124-129, Section 3(a), “Proposing Physical Uranium Activities.”

These points being noted, however, it would be actively stupid to ignore Goldman Sachs’s extensive history of links to Bill and Hillary Clinton – who were profiting mightily from their various connections with commodities kingpins in the 2000s – and the firm’s notable distinction as the top private donor to the Obama 2008 presidential campaign.

Given those relational red flags, it becomes impossible to believe that announcing Goldman’s new venture on Obama’s inauguration day was a mere coincidence – or that a venture into uniquely valued commodities, particularly uranium, had nothing to do with someone’s political interests.  I’m not postulating that the interest was solely or even mainly Obama’s, or the Clintons’.  But it did apparently matter who was in the Oval Office when the new venture, predicated on a “grandfather clause loophole” in U.S. regulations, took off.

WSJ video, YouTube

A brief chronology must begin in 2008, however.  On 26 June 2008, Nufcor – long the trading arm of South Africa’s uranium industry – was bought by Constellation Energy, a U.S. power consortium, through its UK subsidiary Constellation Energy Commodities Group.  Along with representing South African uranium miners, Nufcor was the sole marketing representative for Uranium One.  (Ironically, Nufcor was also the marketer that sold South African yellowcake to the Shah’s Iran back in the 1970s, a factoid mentioned in virtually every report on Nufcr’s more recent doings.)

Uranium One had acquired Frank Giustra’s mining company UrAsia – the one that obtained uranium concessions after Bill Clinton’s trip to Kazakhstan – the year before; i.e., in 2007.

Constellation Energy Group at that point was thus the parent company of Uranium One’s sole marketing agent.

In July 2008, Nufcor bought 620,532 pounds of uranium from “a major international player for fourth-quarter delivery.”  The major international player was unnamed.

In September 2008, Goldman Sachs announced its intention to become the fourth largest bank holding company: the instrumentality by which the firm would go on to trade in and hold physical commodities.  See the Senate investigation report (link above) for detailed discussion of how this loophole came about.

Interestingly, in the fourth quarter of 2008, George Soros increased his holdings in Goldman Sachs by just over 40%.  That may or may not have special significance, but Soros and his executives would certainly have been aware of Goldman’s major move to become a bank holding company, and probably knew of the firm’s intention to use that status to trade in physical commodities.

On 20 January 2009, President Obama’s inauguration day, Constellation Energy Group announced the sale of most of its UK subsidiary – which now owned Nufcor – to Goldman Sachs.

Goldman was thereby purchasing power companies, trading companies, physical coal and natural gas, and Nufcor’s 900,000 pounds of uranium (the figure in the Senate report), along with a uranium trading infrastructure that included exclusive market representation for Uranium One.

Goldman in the catbird seat

Take a moment to consider that this meant Goldman would have access to everything needed to trade legally in uranium: not just the ability to speculate on market trends, but the infrastructure supporting the legal purchase and sale, and approved transport and holding of uranium.  Nufcor’s connections gave Goldman such access in South Africa and Canada, where the legacy companies had mining interests, at a minimum.  As outlined in the Senate report, Nufcor bought and sold in the U.S., UK, and France as well.

The Senate’s focus in 2014 was on the advisability of this from the standpoint of market integrity and radioactive-materials safety.  Those are important concerns.

Goldman Sachs headquarters at 200 West Street, New York. YouTube video

But we must also consider that allowing one of the biggest financial houses on the planet to hold vertically integrated interest in uranium would also be extremely fascinating to people with an interest in uranium – as opposed to an interest in profiting off uranium futures.  Goldman could do more than make money off uranium on paper.  Goldman Sachs could move actual uranium around.

Goldman’s purchase of the UK Constellation subsidiary was approved and complete by June 2009.  (Interestingly, the EU approval took less than four weeks.)  I can find no public records of what happened, specifically, to Nufcor’s 900,000 pounds of uranium after that.

The Senate report indicates, however (p. 5) that Goldman Sachs significantly increased Nufcor’s annual amount of uranium trading:  “[A]fter Goldman bought Nufcor, the uranium company, it increased Nufcor’s trading activity tenfold, going in four years from an annualized rate of 1.3 million pounds of uranium to trades involving 13 million pounds.”

In another interesting twist, the Senate report records the following about Goldman’s purchase of Nufcor in 2009 (see p. 118):  “Because no employees who conducted Nufcor’s business joined Goldman after the sale, Goldman employees ran the business.”

A detail like this raises more questions about the transaction and what purposes Goldman – and/or someone connected to Goldman – had for it.

A path to the Uranium One sale in 2010

All of this was happening as the Russians’ Rosatom bid for Uranium One was in development.  (Did I mention that Goldman Sachs was advising Rosatom’s ARMZ on the Uranium One deal?)

A key event in that tale took place in August 2008, when the FBI began investigating a Rosatom subsidiary, Tenam, for allegations of bribery and corruption.  Tenam is the U.S. arm of Rosatom’s export company Tenex (which, as we reviewed a few weeks ago, became the parent company in 2010 of the Russian firm Khimprom, maker of gas centrifuges for uranium enrichment.  Alexei Klishin, the associate of Stephan Roh and Joseph Mifsud, and principal in a company connected to Vinkins Holdings Limited, had worked out a sale of Khimprom to Clinton donor Viktor Vekselberg in 2006-2007).

The FBI probe of Tenam reportedly benefited from an insider informant, William Campbell, who passed on updates about bribes allegedly going to the Clintons from the firm in 2009.

Bill Clinton at Renaissance Capital’s symposium in June 2010 for the $500,000 speech. (Image: Renaissance Capital via Breitbart)

Meanwhile, a brief excursion into what Goldman Sachs bought with Nufcor is of interest in the Uranium One drama.  As we might expect, given all the other connections to Uranium One (including Goldman’s advisory role with ARMZ for the 2010 purchase), there is another whiff of Uranium One links in the mix.

The Senate report summarizes on p. 123 what Goldman’s holdings came to with the Nufcor purchase.  Nufcor had originally been formed in South Africa in the 1960s to process and market uranium.  Additional entities were created in later decades as business expanded:

In 1999, Nufcor incorporated a new subsidiary in London, Nufcor International Ltd., to undertake trading in nuclear fuel cycle products and services.  Nufcor also created an investment adviser, Nufcor Capital Ltd., which managed an investment fund, Nufcor Uranium Ltd., for uranium-related investments.  By the mid-2000s, Nufcor and its related affiliates were actively engaged in owning physical uranium, trading financial products related to uranium, and advising investors on uranium-related investments.

Thus, Nufcor International Limited was the entity that handled the physical commodities.  It was Nufcor International Ltd. that interested the Constellation Energy Group in the 2008 buy, and the same entity that Goldman subsequently bought for development in 2009.

Goldman did buy at the time both Nufcor International and Nufcor Capital, and an 8% stake in Nufcor Uranium.

But Nufcor Uranium Limited, the investment fund, basically spent the year 2009 being sold off, while Nufcor Capital was “wound down.”  Since its formation in 2006, Nufcor Uranium Ltd. had been one of two publicly traded uranium investment funds, the other being Canada-based Uranium Participation Corporation (UPC).  In September 2009, Nufcor Uranium Ltd.’s name was changed to Uranium Limited, and its stock ticker symbol from NUL to UML.  The investment firm was to trade under that symbol on both the London and Toronto exchanges.

In January 2010, however, Uranium Limited merged with UPC in an all-shares buyout conducted with little fanfare.

And that’s where we get the other whiff of Uranium One.  Reportedly, at the time of Rosatom ARMZ’s 2010 acquisition of a 51% stake in Uranium One, UPC was one of the remaining shareholders (i.e., in the 49%), with a “significant stake” in Uranium One until ARMZ completed the buyout and took Uranium One private in 2013.

Goldman Sachs would of course have known that at the time of the all-shares acquisition by UPC, both because Uranium Limited had been a Nufcor property and because Goldman was advising ARMZ on the Uranium One purchase.  In hindsight, Goldman was pretty cozy with everyone coming and going around Uranium One.


But more than that, in 2009 Goldman Sachs got a big foothold in inventories of physical uranium. The Senate report has a few informative passages on the results of Goldman’s foray into commodities holding and management.  As mentioned earlier, there were no legacy personnel kept on from Nufcor International Ltd.

“No employees conducting Nufcor’s business stayed on after Goldman acquired it,” says the Senate report’s description, “and as a result, Goldman employees in the GS Commodities group took on management of Nufcor’s operations.  As a result, Nufcor International Ltd. became a shell company whose business activities were conducted exclusively by Goldman employees.  As one Goldman document put it, Nufcor’s uranium activities were ‘treated as [the] firm’s own activities.’” (p. 130)

The nature of Goldman’s activities via Nufor International Ltd. is also outlined on p. 130:

Since acquiring Nufcor in 2009, Goldman has used Nufcor International Ltd. to engage in a wide array of uranium-related activities.  The activities included buying and selling physical U3O8 and physical UF6 on the spot markets; forward contracts to buy and sell physical U3O8 and UF6; options on U3O8 and UF6; uranium futures contracts; and Conversion Service Credits.  Goldman also took ownership of hundreds of thousands of pounds of physical uranium, and became a supplier of uranium to utilities with nuclear power plants.

As alluded to above, Goldman significantly increased both the trading volume and the uranium inventory of Nufcor (which I will henceforth refer to a simply “Nufcor,” on the understanding that the capital and Uranium Limited investment firm entities were not involved in this set of activities).

Nufcor’s fortunes under Goldman management through 2013. From p. 131 of the 2014 Senate report.

The Senate report summarizes it on p. 140:  “By 2013, Goldman controlled millions of pounds of uranium in storage facilities in the United States and Europe.”

Congress began to be uneasy about Goldman’s uranium venture, and the Senate investigation was evidence of that.  Although the uranium enterprise was launched in 2009, it wasn’t until after the beginning of Obama’s second term that the Senate geared up to look into the matter.  We must inevitably reflect that this also meant the probe came after Hillary Clinton left the State Department at the beginning of February 2013.

By the time of the Senate report, its authors had this to recount (p. 133):

In 2014, Goldman put Nufcor up for sale.  Goldman told the Subcommittee that because it did not receive an acceptable bid for the business, Goldman was in the process of winding down Nufcor over the next several years.  Goldman told the Subcommittee that, as part of the wind down, it has stopped building its inventory of physical uranium and expects its physical and financial uranium positions to steadily decrease over the next few years.  Goldman explained that it currently has one uranium supply contract that continues until 2018, and expects to complete that contract.

Possibly the lamest sentence in the entire report is the one that comes next on p. 133:  “When asked why Goldman is exiting the uranium trading business, a Goldman representative replied that it was because the physical uranium business was ‘easy to misunderstand.’”

If that seems like a curiously opaque, almost frivolously worded reason for proposing to exit the uranium trade, the subsequent history adds a quizzical fillip to it.  Goldman did put Nufcor on the market in 2014; it turned out that Deutsche Bank had also entered uranium commodity holding at around the same time Goldman did, and decided to sell the business off at the same time as well.  Market analysts tended to put this down to depressed uranium prices following the tsunami-induced near-catastrophe at the Fukushima nuclear power plant in Japan in 2011.

Goldman didn’t find a satisfactory buyer, however, and as the Senate report indicates, Goldman explained that it was in the process of winding down the Nufcor uranium business.

Goldman still hasn’t sold off or ceased to operate Nufcor International Ltd., however.  It remains a UK-incorporated company, with its parent listed as Goldman Sachs.  An assets report for the year 2018 indicates assets of about $177 million – not an exact counterpart to the $241.8 million reported by the Senate for 2013, since we don’t know how much of the 2018 total represented uranium holdings, but still indicating quite a bit in assets stashed in a “winding down” company.  Interestingly, Nufcor reports taking out loans in 2018 in the amount of $93,290,000 for “group undertakings”: a rather healthy amount of risk being assumed by a dying cat.

The last filing from Nufcor listed at the Companies House website is from April 2020.  Information at the international LEI company search website shows the latest filing by Nufcor as dating to 3 August 2020.  Nufcor International Ltd., the company Goldman Sachs was going to start winding down back in 2014, isn’t wound down yet.

In Part II, we will look at the remarkable M/V Arctic Sea incident in the summer of 2009, an event for which there has never been a satisfactory explanation.

J.E. Dyer

J.E. Dyer

J.E. Dyer is a retired Naval Intelligence officer who lives in Southern California, blogging as The Optimistic Conservative for domestic tranquility and world peace. Her articles have appeared at Hot Air, Commentary’s Contentions, Patheos, The Daily Caller, The Jewish Press, and The Weekly Standard.


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