Opportunity for smaller uranium deposits

Addressing a uranium conference, Toro Energy’s managing director, Greg Hall, said this market dynamic was however, creating a unique opportunity favouring the more urgent development of smaller economic deposits in Australia.
“There is no doubt long-term uranium demand is there, even with current short-term supply and price volatility but demand is double what it used to be five years ago,” Hall said.
“Something like 150 million pounds of uranium is being put into long-term contacts every year and the reality is that a one gigawatt power reactor will come on line every month for about three years from 2014,” he said.
“This will be a significant time in the global uranium market and Australia has a place to play.
“However, most of the Australian production from existing mines or new expansion over the next 10 to 15 years is already allocated with major utilities or customers - and very little domestic uranium can now be termed “unallocated”.
It is an environment that has driven Toro’s decision to bring its Wiluna project into production as soon as possible. Predicted to produce around 700 tonnes a year, Wiluna’s output is not allocated output, a position which Hall said the company will protect for as long as possible.
On long term prices, Hall said he expected them to swing back towards US$75-85 a pound even though there was some persistent softness in the spot market currently.
“The Chinese bought about 3,700 tonnes of concentrate last year and they bought carefully in the downtimes,” Hall said.
“There is a lot of buying going on, however, and this will firm as more reactors come on line and supply is increasingly locked into longer term contracts.”

Lack of energy policy endangering Australia’s future
Professor Ian Plimer also addressed the conference, sending a clear message to Australian governments that the lack of a cohesive long-term energy policy in Australia will hold back its development and could have devastating long-term financial implications.
“The sector also has to deal with existing community perceptions that uranium mining is ok but ‘not in my backyard’, in addition to over prescriptive regularity regimes and access to sufficient skills and expertise to develop projects,” said Plimer, Professor of Mining Geology at the University of Adelaide.
He warned that a lack of regulation and coherent centralised planning would land Australia on “the road to bankruptcy”.
“Without an energy policy, without going down the nuclear path in addition to our coal fired power, we are putting ourselves on the road to bankruptcy,” Professor Plimer said.
“The reality in Australia is that we have a lot of cheap energy which attracts employment, and that energy has to be looked after, especially our precious hydro resources.
“Solar and wind power are a total waste of energy to build, biofuels are starving people in Third World countries, and with nuclear, we have lost the skills and expertise we once had – although we now know that nuclear is a potentially cheaper option than coal.
“We have two countries (Australia and Canada) holding 80 per cent of the world’s uranium, but what we have is people who are not going to accept nuclear, waging a war against coal, and refusing to listen to any of the science.
“That means that energy for this country is under threat,” Professor Plimer said.