Rio sticks by uranium mining plans in wake of Japan crisis

Rio Tinto says it will soldier on with plans to mine uranium, even though it acknowledged the sector could remain unmoving for several years in the wake of Fukushima.

The mining giant’s chief executive Tom Albanese said in a speech there is no doubt the recent nuclear meltdown in Japan had affected the growth of uranium mining and nuclear power sectors..

”For us, I think maybe the growth rate of uranium over the next 10 years could be slower than it would have been, post-Fukushima,” he said.

”There will probably be, over the next five years, an extended delay in some new construction as a consequence of studies, more community challenges in getting new facilities planned, permitted or built.”

Rio has an interest in the Rossing mine in Namibia and a controlling stake in Energy Resources of Australia and is currently one of the biggest uranium producers.

Despite the debate surrounding the industry and the decision by Italy, Germany and Switzerland to abandon nuclear power, Albansese said the demand will not decrease.

In the wake of the earthquake in Japan, nuclear energy is at the forefront of most people’s minds right now as the world is looking for ways to generate baseload electricity with minimal greenhouse gas emissions.

A report by Resource Capital Research (RCR) states that of the 13 reactors on Japan’s northern coast impacted by the quake and tsunami, those that completely failed were the oldest, which were constructed before 1980.

Of the four that were impacted, at least three will remain closed permanently, the report says, and restarting the other reactors which shut down automatically when the quake hit will be delayed due to damage to related facilities and infrastructure.

It goes on to say that Japan has 55 nuclear reactors with annual uranium consumption of between 12 and 13 per cent of the global uranium demand, at 21.3mlbs.

Professor Stephen Grano, director of the Institute for Mining and Energy Resources at the University of Adelaide told Australian Mining the debate about nuclear energy is not one exclusively for politicians, but rather should be determined by the industry, importers and investors.

“Why should there be a political debate and not a debate on the benefits?” he asked.

“It’s not only political, it’s economic.

“If a company can see value in enriching uranium at the source through value adding, it will be under our conditions of energy supply costs, our conditions of capital and human costs, our conditions of transport, relative to their enrichment plants already operating overseas.”

Grano sees a future for the Australian uranium market in export, but says enriching uranium for local consumption would not make sense because more energy could be exported in uranium than would be used locally.

Albanese has echoed Grano’s comments that the world should not rule out uranium because of the incident in Japan.

”Our intention is to stay in the uranium business,” he said.

”We’ve had a look past the next five or 10 years, past 2020, so from my perspective Rio Tinto will stay in the uranium business.”

”If I look forward to the next 10 years, I see underlying strength in demand for the products we produce,” Albanese said.

But Albanese acknowledged uranium mining will not be simple, but Rio is ready for the challenge.

”We are going to find a wall of worry over the next 10 years, I hope we climb it.

Be ready for the waves, be ready for the ocean turbulence between here and there because there is going to be some rough sailing.’