Uranium upside yet to be determined: Patersons Michael Vaughan Tuesday, 25 July 2006
AUSTRALIA'S budding uranium producers can look forward to unprecedented demand and prices for their yellowcake in the next decade and beyond because the Chinese dragon is still half asleep from a nuclear perspective, according to Patersons Securities head of research David Johnson.
Speaking at the opening of the Australian Uranium Conference in Fremantle, Western Australia, Johnson told delegates that nuclear power currently only provides about 3% of China's energy needs compared with about 25% in Japan and 40% in South Korea.
China's reliance on liquefied natural gas and coal will, in some part, be replaced with nuclear power, according to Johnson, leaving a huge opportunity for uranium producers in Australia.
"China is not a player yet in this game and I do stress the word yet," Johnson said.
He forecast energy demands in the Asia-Pacific region would rise about 5.6% per annum over the next decade compared with just 3% in the rest of the world.
This means by 2015, the Asia-Pacific region's energy needs will be about 90% higher than what was seen in 2005, with more than half of the growth coming from China.
Johnson admitted the role of India was difficult to predict and could provide further upside.
The result of this increased demand will see an upsurge in exploration and development in Australia over the next decade, according to Johnson.
"We've got to get the stuff out of the ground and that's what I see happening in the next 10 years," he said.
"The whole industry is set to meet that challenge and I haven't finalised the numbers yet … but I certainly think it's [uranium demand] going to go much higher than it is."
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