Australian uranium exports to double

Australia’s uranium exports stand to double in value within the decade to above A$1 billion from A$570 million currently as the nation steps up to increasingly fill the gaps between world uranium supply and demand.

The prospect was outlined at the 2007 Paydirt Australian Uranium Conference in Adelaide by Australian Uranium Association Executive Director, Michael Angwin. “Australia cannot isolate itself form the search for additional energy sources,” Angwin told the record 380 delegates to the conference. “Significantly, middle Australia has shifted ground considerably and positively on uranium exploration and mining and there is now a much larger groundswell of support for an expansion of this potential,” he continued.

“This shift has occurred under the influence of a high level of economic understanding, including the link between jobs and exports, awareness about climate change and growing appreciation that uranium does not produce carbon dioxide emissions in generating electricity. Uranium demand is expected to increase by 50% in the next 25 years and will exceed supply within the next decade, allowing an opportunity for Australia to double its uranium exports and double its uranium earnings within the next few years.”

Angwin warned that while uranium mining had shifted into the Australian mainstream, it needed bipartisan acceptance. He said this would create a more stable uranium mining investment climate in Australia in parallel with a ‘fit-for-purpose’ regulatory environment. “Australia’s uranium industry has an excellent operational record and this should generate public confidence in our ability to expand our local exploration and mining,” Angwin said.

Also at the Paydirt Conference was Paul Holloway, Minister for Mineral Resources Development, who noted that the number of delegates attending the conference had doubled from the 2006 figure, showing the rapidly increasing focus on uranium issues and uranium mining in Australia.

The conference was held on March 22-23 in Adelaide, South Australia, the state that Holloway commented has been the clear leader in mining policy development in the country for the last three years. “Here in South Australia we are very proud of our PACE initiative – our Plan for Accelerating Exploration. We launched it about this time three years ago. At that time our exploration expenditure was just under A$40 million, which represented 4.9% of the national spend. In 2006, that figure reached A$191 million, which is 13.2% of the national spend. There is the proof that PACE is working.

“Had we just maintained our 4.9% share our total would be approximately A$71 million. But our share is growing, proving that our exploration expenditure really is accelerating and that PACE is working. Adding to the excellent exploration data is confirmation from the Fraser Institute that the performance of South Australia’s mining sector is among the best in the world. According to the respected Canadian institution’s annual Survey of Mining Companies, South Australia now ranks fourth in the world in terms of mineral potential – a rise from sixth place in last year’s survey, and 18th place the year before that.

“There are many reasons to explore in South Australia, but I especially want to mention two. The first is that in South Australia, we help fund exploration. The drilling partnerships are a well-known part of our PACE initiative. The second reason is that if you find something you want to mine here, you will pay the lowest royalty in the country for new mines – 1.5%. I suspect our low royalty rate is not too well known outside of South Australia. We feel well justified when we claim that South Australia is THE pro-mining state in Australia.

“This state has also led the debate about changing the ALP’s ‘no new mines’ policy. The Premier wants it to change, the Deputy Premier wants it to change, I want it to change, and in recent times you may have read that our Transport and Energy Minister Patrick Conlon also wants the policy to change. Importantly, the Federal Party Leader Kevin Rudd has also publicly supported policy change in this area. According to the ABS, 56% of the uranium exploration activity in Australia is taking place right here in South Australia.

“During the past twelve months, the money spent on exploring for uranium in South Australia has topped $30 million – that’s the highest figure for 25 years. With around 60 exploration companies and prospectors currently holding more than 200 exploration licences for uranium in South Australia – and a growing list of Adelaide-based uranium explorers listing, or proposing to list, on the Australian Stock Exchange – this state’s uranium industry is in very good shape.

“South Australia’s two – soon to be three – mines operate under the strictest, most environmentally protective, most anti-proliferation legislation in the world. If Australia doesn’t supply the demand for uranium, other countries that take these responsibilities far less seriously, such as Kazakhstan, will. This is an important matter for our state.

“It makes me smile every time I think about that mine to our north but it’s not just about Olympic Dam. That mine is already approved. Changes to the policy won’t affect them. The ALP needs to change its policy because here in South Australia, there are projects that are well on the way to beginning the approvals process. Projects such as Curnamona Energy’s Oban prospect and the Quasar/Alliance Resources Beverley Four Mile deposit.

“Potentially, we have two mines up for approvals in the next 12 months. This represents millions of dollars of investment and hundreds of jobs. Other projects such as Marathon’s Mt Gee deposit are coming along nicely. The State Government is very confident that the no new mines policy will change, allowing South Australia’s competitive advantage in the uranium sector to come to the fore.

“When the federal policy changes, it is likely that it will then be up to each state to change its own policy. It’s my opinion that South Australia will move fairly quickly to change our policy. I encourage investors to remember that they will be welcome here in South Australia,” concluded Holloway.