With the world's highest recoverable uranium resources, Australia will benefit from supplying the resource to India, one of the world's fastest growing energy markets.
Australia has now signed a bilateral "nuclear co-operation" agreement for the supply of uranium to India. This comes after the Federal Government's overturn of a longstanding ban on uranium sales to India in 2011 and a further two years of negotiations between the countries.
The agreement makes India the first country that is not a signatory to the Nuclear Non-Proliferation Treaty to receive uranium from Australia. Despite this, the safeguards set out in the bilateral agreement aim to ensure that the uranium provided to India remains for exclusively peaceful use, effectively placing India in line with Australia's obligations under the Nuclear Non-Proliferation Treaty.
The bilateral agreement is not yet publically available and it will now need to be tabled in Parliament and be considered by the Treaties Committee. However, we expect that the bilateral agreement will reflect many of the key terms of the Nuclear Non-Proliferation Treaty, as well as those required by the International Atomic Energy Agency, including: that Australian uranium is only transferred to third parties with Australian consent; that the uranium is kept physically secure; and that Australian uranium is not used for, or diverted to, nuclear weapons programs.
With the world's highest recoverable uranium resources, Australia will benefit from supplying the resource to a country that is one of the world's fastest growing energy markets. India is predicted to become a major user of nuclear energy over the next 15 years, increasing its nuclear capacity to 14.6 GW. India currently has 21 operable nuclear power reactors, six under construction and a further 57 that are the in early planning stage.
The Commonwealth Government policy on uranium has gradually shifted over the past 10 years, with the abandonment of its "No New Mines" Policy in 2007 after entering into the Australia-China Transfer of Nuclear Material Agreement and the Agreement for Cooperation in the Peaceful Uses of Nuclear Energy (AC Agreements) in 2006. Australia now exports uranium to the European Union, Japan, USA, China, South Korea, Canada and Taiwan. Although Australia entered into a bilateral agreement with Russia in 2010, Australia announced a ban on uranium exports to Russia in September 2014 until further notice.
Over the last 15 years we have seen a significant change in Commonwealth, State and Territory uranium mining policy with the lifting of the Federal "two mines policy" and Western Australia, Northern Territory and South Australian governments all now support uranium exploration and mining.
In New South Wales, the Government overturned the 26 year stance against the exploration for uranium in 2012.
The ban on uranium mining in Queensland was removed in July of this year and the Mary-Kathleen uranium mine near Mt Isa will be open for tenders in the coming months. The reopening of Mary-Kathleen is said to unlock $4 billion worth of mineral resources, with "a potential royalty value for the State of more than $100 million".