Nuclear power accounts for around 16%
of the world's electricity supply and a major component of power
generation in many countries - USA (20% of domestic electricity
production), Japan (29%), Germany (32%), Hungary (34%), South Korea (38%),
Sweden (52%), Lithuania (72%) and France (78%).
There are 441 reactors operating in
30 countries with total installed capacity of 368GWe. Another 24 reactors
are under construction with new capacity expected to be added in China,
India, Japan, Russia and South Korea. China has ambitious plans and India
has announced plans to build 24 new reactors.
The outlook for nuclear power is changing due to concerns over global
warming. The industry's has an excellent safety record, and progress
is being made on waste disposal issues.
All of the foregoing factors suggest increasing demand for uranium.
Uranium spot prices have risen from around US$10.00/ lb U3O8
in early 2003 to over US$40.00/lb U3O8 by March
The latest nuclear fuel market forecast, published by the World Nuclear
Association in September 2005 ("The Global Nuclear Fuel Market, Supply and
Demand 2005-2030"), forecasts global uranium requirements to rise
from the current level of about 178 million pounds U3O8
per annum to 186 million pounds per annum by 2010 and further to
approximately 220 million pounds U3O8 per annum by
Uranium supplies for nuclear fuel are mainly provided by a mix of:
- mine production;
- reprocessing of spent nuclear fuel
- drawdown of inventories.
As secondary supplies decline, additional primary production will be
required to satisfy increasing global requirements. Current production
(2004) totals around 105 million pounds U3O8 per
year which must expand to around 195 million pounds per year by about
This "primary production gap" will need to be filled from three sources:
- scheduled production from
facilities already in operation
- undeveloped projects
- future discoveries.
Recent uranium price forecasts
suggest that future prices are likely to remain in the range of
US$35.00-45.00 per pound U3O8 over the next decade
although the price weakening into the US$mid-20 per pound U3O8
range cannot be discounted.
AUSTRALIA’S ROLE IN THE
Australia is the second largest
uranium producer in the world, with 22.3% (8,982 tonnes) of world mine
supply in 2004. Canada is the largest producer with 28.8% (11,597 tonnes)
of world mine supply. The next largest producers are Kazakhstan (9.2%),
Niger (8.2%), Russia (8.0%) and Namibia (7.6%).
However, Australia has approximately 30% of the world's uranium resources.
Other countries resources include Kazakhstan (17%), Canada (12%) and South
Most of Australia's total uranium
resources are held within only six deposits:
- Olympic Dam in the Gawler Craton
region of South Australia, the world's largest uranium deposit.
- Ranger, Jabiluka and Koongarra in
the Alligator River region.
- Kintyre in the Rudall Province and
Yeelirrie in the Yilgarn Craton of Western Australia.
Virtually all of Australia's
significant uranium deposits were discovered between 1969 and 1980 during
a period of high exploration expenditure for uranium by major companies
with large budgets and using advanced exploration techniques and
This was followed by a long period of relative inactivity and low
exploration expenditure for uranium-only mineralisation from 1982 onwards,
during which only one deposit (Kintyre in Western Australia) was
discovered. Australia increased its resource base since 1982 only because
of the ongoing delineation of resources at the known deposits.
As a result, much of Australia, including the Gawler and Curnamona Cratons
have not been explored for uranium for over 20 years.
THE POLITICAL LANDSCAPE
In the last ten years, there
have been important positive changes to Commonwealth government policies
relating to the mining and export of uranium, headed by the abolishment of
the "Three Mines Policy" in 1996.
The current Australian Federal government's objective is to encourage the
development and growth policy is to develop the export potential of
Australia's uranium industry by allowing mining and export of uranium
under stringent environmental requirements and strict procedures fro the
export of uranium strict international agreements designed to prevent
nuclear proliferation. This compliance is monitored by the Australian
Safeguards and Non-Proliferation Office.
Proponents of new uranium mines in Australia are required by legislation
to complete a comprehensive environmental impact assessment process, which
calls for public comments on the proposal. The projects are assessed
jointly by Commonwealth and State / Territory government agencies. For
approval, the projects must meet strict requirements for environmental,
heritage and nuclear safeguards.
The States and Territories control the licencing of uranium mining and
have a wide range of policies on the development of uranium mining. The
South Australian State Labor government currently permits uranium mining
at Olympic Dam and Beverley, and supports the planned expansion of Olympic
Dam. In addition, the State government is actively promoting and partially
funding, exploration for uranium-bearing deposits. While it currently
maintains the "no new mines" policy of the Federal Labor party, the South
Australian State government is in favour of reviewing this policy at the
next Federal Labor party conference in 2007. This contrasts with the State
governments in Western Australia and Queensland which have policies
against the development of uranium mines.