Australia gets ready to mine a uranium boom David Lague September 20, 2008 AUSTRALIA'S newly liberated uranium miners are poised to cash in on a global revival for nuclear energy as decades of restrictions fall away.
In the lead-up to his election victory last year, Prime Minister Kevin Rudd removed the major obstacle to expansion when he convinced federal Labor to abandon its 25-year-old policy opposing any new uranium mines outside the three in operation.
Now the incoming Western Australian Liberal government's support for uranium mining clears the way for the development of at least four potentially lucrative deposits.
For an industry that argues that the politics of fear, suspicion and ignorance has singled it out for special treatment, these new freedoms are an early signal that uranium could eventually become part of Australia's mainstream resources industry.
Australian Uranium Association spokesman Simon Clarke says the industry would like to see uranium treated the same as any other commodity and to be left to compete in the market on its merits.
But in the short term, at least, uranium mining is likely to remain controversial, with the Greens in Western Australia threatening a spirited rearguard action to block new mines on environmental grounds.
Political analysts have suggested that a factor in Labor's defeat in WA was outgoing premier Alan Carpenter's pledge to strengthen the state's existing restrictions on uranium mining.
This would have been a major setback for prospective miners, including Canada's Cameco and Mitsubishi Development of Japan, which last month jointly paid about $500 million to buy Rio Tinto's massive Kintyre uranium deposit in the Pilbara.
While miners immediately welcomed the electoral outcome in Western Australia, the industry warns that Australia has failed to fully exploit booming demand for nuclear fuel.
Australia has between 36% and 40% of the world's easily recoverable uranium, while supplying only 19% of global demand, according to the Australian Uranium Association.
The Australian Bureau of Agriculture and Resource Economics (ABARE) reported this month that the value of Australian uranium exports last year jumped 34% to $887 million.
Total exports of uranium oxide, or yellowcake, the form in which the fuel is exported, reached 10,151 tonnes, according to ABARE.
In an indication of mining company confidence, Bureau of Statistics said this month that spending on uranium exploration more than doubled last year to $231.5 million.
And global demand for nuclear fuel is expected to expand rapidly.
There are 34 nuclear reactors being built around the world, along with 439 reactors operating, supplying about 15% of global electricity demand, according to the Geneva-based International Atomic Energy Agency.
The Nuclear Energy Agency, an arm of the OECD, forecast in June that world nuclear energy capacity could increase by up to 80% by 2030.
Nuclear energy authorities have also said that uranium mining will come under pressure to expand output as secondary sources of nuclear fuel, particularly decommissioned nuclear warheads, are gradually exhausted.
Toronto-based Mega Uranium, which has a deposit in WA's Eastern Goldfields, this week said in a stock exchange announcement that it was likely to be the state's first uranium miner. Another prospective miner, the Adelaide-based Toro Energy, welcomed the green light for mining in WA and said it would step up development of its Wiluna project.
However, Australia's existing three uranium mines are unlikely to face any short-term competition.
Industry experts said the mineral composition of uranium deposits tended to differ widely and lengthy evaluation was often required to develop appropriate extraction and processing techniques.
"We would think at the very optimistic end of assessments, there would not be a uranium mine operating in Western Australia for at least three years," Mr Clarke said
