Australia's Labor Party split over uranium mining

Sydney, Apr 29: Australia's opposition Labor Party, riding high in opinion polls ahead of a general election this year, was beset by an internal rift today over uranium mining.

The Western Australia state Labor government defied an about-turn on uranium mines by the centre-left party at a federal level, saying it would continue to ban such mining in the vast mineral-rich state.

The federal Labor Party on Saturday scrapped its 25-year ban on new uranium mines in a move miners said would encourage new investment and which could propel Australia to become the world's leading uranium supplier ahead of Canada.

But Western Australia's ruling Labor Premier Alan Carpenter said he would not be bound by his party's new policy, and he would use his state powers to ensure the vast untapped uranium reserves in his state would be left in the ground.

''Whilst I'm the premier in Western Australia, there won't be uranium mining. I don't feel under any pressure whatsover,'' Carpenter told reporters on the sidelines of the Labor Party's national policy conference in Sydney.

The premier of Queensland state, Peter Beattie, has also said he would continue to ban uranium mining, meaning the country's two biggest mining states would not be part of an expanded uranium sector.

While Labor is in opposition nationally, the party holds power at the state level across the country. State governments continue to hold the right to approve or veto mining developments.

There are currently only three uranium mines, in South Australia and the Northern Territory, but more than 40 listed companies are actively exploring for the mineral, encouraged by a four-fold increase in uranium prices since 2005.

But Australia has no nuclear power stations or enrichment industry.

World'S Biggest Mine

Uranium mining is dominated by the world's biggest mining companies, BHP Billiton Ltd/Plc and Rio Tinto Ltd/Plc.

BHP Billiton owns and operates the world's biggest uranium mine at Roxby Downs in the remote north of the South Australia, and has plans for a major expansion of production there.

The Rio-controlled Energy Resources Australia operates the Ranger Mine in the Northern Territory, while the third mine, Beverly, is operated by General Atomics.

Rio Tinto Group chief executive officer Leigh Clifford said on Friday that global warming had put nuclear power back on the agenda, and Rio, as the world's second largest uranium producer, was keen to expand capacity.

''Uranium is well and truly back on the agenda. Around the world, people are talking about new nuclear stations,'' he said.

But Carpenter's comments mean Rio will remain unable to develop its Kintyre deposit in Western Australia, which has about 25,000 tonnes of uranium.

The Australian Uranium Association hailed Labor's new national policy as a significant development, with bipartisan support for uranium mining nationally for the first time in 30 years.

The Minerals Council of Australia said the new policy was welcome, but Queensland and Western Australia now needed to support new uranium mines.

Conservative Prime Minister John Howard is a strong supporter of uranium mining and wants Australia, the world's biggest coal exporter, to consider nuclear energy as a clean source of domestic electricity.

Australia was on track to export 10,800 tonnes of uranium in 2006/07, worth about (653 million dollars), the Australian Bureau of Agricultural and Resource Economics said.

Uranium was the source of about 16 percent of the world's electricity from over 430 nuclear power reactors, the Association of Mining and Exploration Companies said, with global demand for electricity and uranium expected to increase by 50 percent over the next 25 years.

Reuters>