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The uranium sector took a hit last week as Anthony Albanese announced the end of the mineral lease on Jabiluka in the Northern Territory and the intention to add the area to Kakadu National Park. The decision is a major win for the Mirarr native title holders who have opposed mining on the site, while nuclear enthusiasts have derided the decision due to the size of the deposit during a resurgence in demand for nuclear energy. This week ABSI explores the controversial uranium policies of Australia and how a change in policy could see riches from a global push into nuclear energy as a low-carbon alternative to fossil fuels. 

Uranium and nuclear power have always been a controversial topic. While Australia continues to debate the viability of nuclear energy, globally it has been embraced by many nations and provides ~10% of the world’s electricity from the ~440 reactors in service. These generators, with a combined capacity of ~390GWe, require 80kt of uranium oxide concentrate (U3O8) containing ~67.5kt of uranium each year. Moreover, each GWe of new capacity will see demand increase by ~150 tpa of uranium.

Source: World Nuclear

On the supply side, total production in 2022 from mining came in at ~58.2kt U3O8 containing ~49.4kt uranium (U). The supply deficit was filled from stockpiles and other secondary sources such as ex-military weapons-grade uranium blended down. Kazakhstan is by far the global leader in mine supply with ~21.2ktU mined (43%) followed by Canada’s ~7.4ktU (15%) and Namibia’s ~5.6ktU (11%). Australia ranked 4th in 2022 with ~4.5ktU mined, which is down from ~6.6ktU back in 2019.

Source:  World Nuclear

Australia's production of uranium is respectable at ~10% of global production and provided ~A$812m in export value in FY23. However, these figures could be significantly higher if the country were able to tap its true uranium potential given it holds ~1.7mtU or ~28% of global economic reserves, the most of any country.

Government policy and regulation are what stand in the way of Australia benefiting from the nuclear boom. Currently, uranium mining is banned in NSW, Victoria, Tasmania, and Queensland. Western Australia has a ban on new mines but has four projects with prior approval to proceed with none yet to begin production. The Northern Territory requires Commonwealth Government approval for mine approval but uranium mining has occurred historically with the last operating mine, Ranger, ceasing mining in 2012 and stockpile processing in 2021. That leaves South Australia as the only Australian state with a uranium economy hosting the world’s largest uranium deposit in the BHP-owned Olympic Dam and the privately-owned Four Mile uranium mine.

Source:  World Nuclear

Unfortunately, uranium mining is currently collateral damage in the political debate around nuclear power generation in Australia, an entirely different subject. The conservative opposition is pro-nuclear power and is running on a platform of nuclear power undertaking the heavy lifting to reach net-zero. In contrast, the current Labor government is anti-nuclear and also looking to strengthen their indigenous credentials following the failed voice referendum; thus the move to cancel the Jabiluka lease. For the record, cancelling the Jabiluka lease is the right move for that community but this enmity towards uranium mining is unwarranted. 

Nuclear power is an expensive but reliable low-carbon energy solution that will play a vital role in the energy composition of the net-zero global economy. In Australia, nuclear power is unlikely to prosper given the country’s low-cost natural renewable energy resources but that doesn’t mean the country shouldn’t become a major supplier in the global nuclear economy. Australia has the opportunity to do its part in the global push for net zero by supplying the world with uranium. It's now up to the state and federal politicians to put partisanship aside and work together to create a bureaucracy and regulatory framework that will support the mining of uranium in Australia.

A quick detour to announce the BPC NRL Tipping Competition! 

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