INTERVIEW - Nova Looks to China to Dig Uranium in Australia
Date: 19-Jun-06
Country: CHINA
Author: Nao Nakanishi
Following a nuclear tour in China, Nova managing director Tim Sugden told Reuters that nuclear plant operators such as China Guangdong Nuclear Power Holding Co Ltd were looking into all options, including uranium exploration overseas.
With uranium oxide prices already up at US$45 a pound this week, compared with below US$10 in 2001, plant operators saw the need for safeguarding the fuel supply, especially as China planned to add around 30 gigawatts of nuclear capacity by 2020.
"They are looking at the whole spectrum. They are taking a 30-year timeframe," Sugden said. "How do we guarantee the supply ... We do whatever we have to do -- that's their view."
The tour was organised after the nuclear safeguards deal in April set the stage for uranium imports from Australia, the world's number two uranium producer. Australia has about 40 percent of the world's known reserves.
Nova Energy, one of many junior uranium miners sprouting up in Australia and Canada, has uranium deposits in Western Australia, a state that at present does not allow uranium mining because of its anti-nuclear policy.
But Sugden hopes for a political change in Australia in the next few years, which should allow Nova to develop the mine after 2009 -- ahead of an expected expiry of the US-Russion programme that has made available former weapons material for civilian use.
The programme has helped cover the world's annual uranium need since its beginning in 1995, with low international uranium prices slashing the global annual output to about 60 percent of the fuel needed per year.
"We are focused on being able to develop the mine from 2009 onwards," he said. "If you wanted to develop a uranium mine anywhere in the world now, it would take you five years ... So it's a good position."
Sugden said Nova was to invest A$2 million for a feasibility study of the Lake Way & Centipede Uranium deposits after raising A$6 million through initial public offering in August last year.
If all goes well, the mine would produce about 800 tonnes of uranium oxide a year, with total reserves currently estimated at around 15,000 tonnes, he said.
"It's small but very profitable. Our operating cost is actually probably about $20 a pound," he said. "The gap between supply and demand gets quite critical around 2013."
