in response to other thread regarding Areva and "YRR"AREVA SA,...

in response to other thread regarding Areva and "YRR"

AREVA SA, the world's biggest maker of nuclear power stations, plans to boost its uranium reserves by buying Australian deposits or securing alliances with producers there amid soaring demand for the metal used in atomic reactors.

Areva, already the world's third-biggest supplier of uranium, wants to double production by 2010, Philippe Portella, managing director of the French company's Australian uranium mining and exploration unit, said.

"If we want to increase our production very rapidly, acquisition is part of our strategy," said Adelaide-based Mr Portella, who was previously Areva's chief geologist in Paris. "It's not only Australia. It's worldwide."

Areva, based in the French capital, aims to expand uranium production after prices doubled in a year, spurred by rising demand for electricity. Worldwide spending on nuclear power is forecast to exceed $200 billion by 2030, according to the International Energy Agency.

The French company made a bid in December to develop the Angela uranium deposit in central Australia against 40 rival bidders including Cameco of Canada, the world's biggest uranium producer, Mr Portella said.

Uranium prices reached $75 a pound on February 14, buoyed by delays to Cameco's Cigar Lake project in Canada, in which Areva has a stake.

Areva, controlled by the French Government, expects to more than triple worldwide spending on uranium exploration to about €50 million ($66 million) in 2008 from 15 million euros in 2005. Production should increase to 12,000 tonnes by 2010, Mr Portella said.

"We want to be much more active, and Australia is part of this strategy to develop our exploration work," he said.

Areva last week formed an alliance with Northern Uranium, its first with an Australian explorer, where it will take over management of Northern's undeveloped Gardiner-Tanami Super project in Western Australia and the Northern Territory.

"We will try to have more relationships with Australian explorers and miners, we can assist some explorers to bring their assets to production," Mr Portella said.

Australia holds 40 per cent of the world's known uranium reserves, yet supplies just 23 per cent of global demand because of bans on new mines in all but one of the eight states and territories. The Federal Government is trying to get state governments to drop the ban.

The Northern Territory is the only place in Australia where uranium mines can be developed as the Federal Government took over authority for approvals there in 2005. Labor's policy banning new mines is due to be reviewed in April, supported by South Australian Premier Mike Rann.

"Australia's got the largest share of reserves in the world and if you're a serious uranium company, and Australia's open for business again to some degree, then you need to at least stake a claim here," said Gavin Wendt, senior resources analyst at Fat Prophets Funds Management in Sydney. "Overseas companies such as Areva seem to be banking on a change of heart by the authorities here, they're prepared to play a waiting game."

South Australia and the Northern Territory are the two regions in Australia where political leaders are most supportive of uranium mining, said Kent Grey, Adelaide-based head of the uranium focus group at lawyers Minter Ellison.

Areva's most advanced project in Australia is the Koongarra deposit in the NT, which is stalled due to opposition from indigenous groups.