As global demand for uranium surges due to a nuclear energy revival driven by decarbonisation efforts, Australia finds itself at a crossroads. Despite holding nearly a third of the world's known uranium ore deposits, the nation may miss out on the coming boom due to restrictive state bans on uranium mining.
Currently, only two Australian states—South Australia and the Northern Territory—permit uranium mining. In South Australia, there are two operating uranium projects. However, other states, including Western Australia, have imposed bans on the mining of this crucial fuel. The bans stem from environmental and safety concerns, which have contributed to a reluctance to embrace the industry more broadly.
The global uranium market has seen substantial growth this decade, with prices more than tripling as anticipation builds for increased consumption of the fuel. This rise is linked to major economies such as the United States, Japan, and France, which, along with 19 other nations, have committed to tripling nuclear energy capacity by 2050.
Uranium’s growing importance will be a focal point at the annual Diggers & Dealers conference, which began on Monday in Kalgoorlie, Western Australia. This key event draws resources executives and financiers to discuss industry trends and opportunities. Notably, Western Australia, known for its mining heritage, imposed a ban on uranium mining in 2017, although it exempted four previously approved projects that have yet to reach production.
Jonathan Fisher, CEO of Cauldron Energy Ltd (ASX: CXU), a Sydney-listed uranium explorer, criticized the bans as detrimental to Australia's potential economic gains. Fisher argued, “The bans in some states like Western Australia, which is known for its mining history, are nonsensical and leave the nation at risk of missing out on soaring global demand. The time is now to remove these bans — there’s a real economic cost to not doing it.”
Australia’s limited role in uranium production is also influenced by historical environmental concerns. The lasting impact of the Chernobyl and Fukushima nuclear disasters, coupled with ongoing issues from toxic leaks at the Ranger project in the Northern Territory—operated by Rio Tinto Ltd (ASX: ASX:RIO)—has contributed to the cautious approach towards uranium mining in the country.
As global demand for uranium continues to rise, Australia's current stance on uranium mining could have significant implications for its future in the global energy market.