The Australian Nuclear Horn (Daniel 7)

West Australian uranium mines win approval as prices rise

As output slows elsewhere, Australia's export market has big potential

GEOFF HISCOCK, Contributring writer

SYDNEY -- Canadian uranium mining giant Cameco Corporation has won approval for a big new mine known as Yeelirrie in Western Australia, bringing to four the number of projects in the Australian state that are ready to swing into production if world uranium prices continue to improve from a 12-year low reached in November 2016.

Australia is the world's third largest uranium producer, behind Kazakhstan and Canada. It has no nuclear power industry of its own and exports its entire uranium output, primarily to nuclear power station operators in Japan, China, South Korea, Taiwan, Europe and the U.S.

The Liberal National government in Western Australia, which faces a state election on March 11, approved the Yeelirrie uranium project, 650km northeast of the state capital Perth on Jan. 16. It follows similar state approvals in the past month for two other uranium projects -- Vimy Resources' Mulga Rocks and Toro Energy's Wiluna.

Cameco, the world's biggest listed uranium producer, earlier won federal and state approval in 2015 for another uranium project known as Kintyre, about 750km north of Yeelirrie in the East Pilbara region. Cameco's partner in Kintyre is Japan's Mitsubishi Development.

Cameco bought 100% of the Yeelirrie project in the state's Goldfields region from BHP Billiton in 2012, paying $430 million for a mine that will have an operational life of 18 years. But since then, it has held back the project amid unfavorable market conditions in the uranium industry.

Conditional go-ahead

Western Australia's state Environment Minister Albert Jacob gave Yeelirrie a conditional go-ahead despite a recommendation against approval from the state's Environmental Protection Authority, which warned of a potential threat to tiny prawn-like subterranean creatures known as stygofauna and troglofauna that live in the area.

Cameco Australia's Managing Director Brian Reilly said state government approval was a "significant step forward" and that the company was taking prudent steps to prepare the Yeelirrie project for "improved market conditions."

Yeelirrie's measured and indicated resource base is 127.3 million pounds of U3 O8 (a mixture of uranium oxides known as yellowcake), making it one of the largest potential mines in Australia.

As yet, no uranium mines operate in Western Australia, and the opposition Labor Party opposes uranium mining. But the party has said that if it wins office in the March state election, it would not overturn approved projects because of the damage it could do to investment risk perceptions.