Australia Prepares to Overtake Canadian Uranium Production – by Marilyn Scales

Marilyn Scales is a field editor for the Canadian Mining Journal, Canada’s first mining publication. She is one of Canada’s most senior mining commentators.

Australia will quadruple uranium production pushing itself ahead of Canada as the world’s largest producer. Australian state premier Mike Rann made this boast to a group of Indian journalists at the Citi Australia and new Zealand Investment conference earlier this month, according to a report in The Hindu of March 8, 2009.

The single project that would rocket Australian uranium production ahead of Canadian is the expansion of BHP Billiton’s Olympic Dam mine. The company is looking at the feasibility of expanding output from 4,300 t/y to 19,000 t/y. That would create a single mine that could produce 35% of the world’s current uranium needs.

The newspaper account did not specify whether all those tonnes per year were elemental uranium or uranium oxide. A quick peek at the BHP Billiton website confirmed that the annual output is tonnes of U3O8.

An expanded Olympic Dam mine would become the world’s largest, bumping Escondida in Chile down to second spot. With the expanded uranium production comes increased rates for copper and gold, making Olympic Dam the fourth largest copper mine (730,000 t/y) and fifth largest gold mine (500,000 oz/year). Reserves are sufficient for at least 100 more years, if what was reported in The Hindu was correct.

Australian uranium output has been growing steadily since 2002 as Canadian output shrinks. In 2007, the latest figures I could find, Canada produced 9,476 tonnes of uranium and Australia 8,611 tonnes. The switch in positions may not come this year or next (BHP Billiton just cut 85 jobs at Olympic Dam), but the change is probably inevitable.

Seeing Canada lose its first-rank standing in anything is tough. But if the nuclear power generating industry grows as expected, there will be strong demand for Canadian uranium as well as Australian.