Australia: New report takes Queensland one step closer to resuming uranium mining

Key Points:

After 31 years uranium mining in Queensland is a step closer to recommencing.

The Uranium Mining Implementation Committee (UMIC) headed by Councillor Paul Bell AM has released its report Recommencement of uranium mining in Queensland: A best practice framework. The Report was commissioned by the Queensland Government following its announcement in October 2012 to allow uranium mining to recommence in Queensland.

Given that the last uranium mine in Queensland, Mary Kathleen, closed in 1982 the UMIC was asked:

"To report to the Government recommending a best practice policy framework for the orderly development and operation of a recommenced uranium mining and export industry in Queensland. The framework should ensure that the uranium mining recommences with world best practice environmental and safety standards, whilst creating an attractive environment for investment."

Queensland has an estimated $10 billion in uranium deposits. The four main regions are the McArthur Basin (Westmoreland), the Mt Isa Province (Mt Isa to Cloncurry), the Gilberton Basin (near Georgetown) and Charter Towers Region (Ben Lomond).

Environmental and planning issues for uranium mining

The community sensitivities to the uranium and nuclear industry require the framework to meet best practice and alleviate community concerns about environmental and safety issues associated with the uranium industry.

The Report has made a number of recommendations. Significantly, it does not propose a new legislative regime in Queensland to approve and regulate uranium mining but finds that existing mine, environmental approval, safety, and radiation framework can be used with some adaptation, such as the creation of uranium mining specific policies and procedures, to ensure best practice is applied.

The Report recommends utilising the "co-ordinated projects" process in the State Development and Public Works Organisation Act 1971 (SDPWO Act) for the approval of uranium projects. The use of the SDPWO Act would mean that uranium mining projects would be administered by the Coordinator General and allows a holistic approval process for approvals to be used. It also means conditions could be imposed for both on and off mining leases.

How should uranium be transported?

The Report also finds that the preferred transportation routes should be by road to ports in Darwin or Adelaide, and at this stage it is unlikely to use Queensland ports. It acknowledged that since uranium is such a concentrated material it is unlikely that road infrastructure investment would be required specifically for uranium transportation.

Currently in South Australia approximately 6,000-7000 tonnes of uranium oxide (around 10% of the annual world demand) is transported to Port Adelaide for shipping overseas each year. In transportation terms this can be managed by 150 to 200 truckloads per year.

The Report notes that if a request is received to export through a Queensland Port the Government would assess that under the co-ordinated projects process in the SDPWO Act.

What should the uranium royalty rate be?

In relation to the royalty rate the Report recommends a 5% royalty rate with the possibility of an initial concessional rate of 2.5% for the first five years. This is similar to South Australia that has a concessional rate of 2% for the first five years of a new mine, then increasing to 5%.

However, the Report also recommends the option of a higher stepped royalty rate be investigated which could come into force when the market price for uranium is very high.

Other recommendation affecting uranium mining

The Report also makes a number of other recommendations, including:

  • utilising a bilateral agreement with the Commonwealth Government for the assessment under the Environmental Protection and Biodiversity Conversation Act 1999;
  • establishing a whole of Government Uranium Mining Oversight Committee to oversee uranium mining implementation, operations and rehabilitation which will include representatives from the relevant Government departments;
  • the Government should seek independent specialist scientific advice and that advice should be sought from the Supervising Scientist Division of the Australian Government;
  • a Uranium Mining Stakeholder Committee should be established which includes representatives from stakeholder groups and should be responsible for ensuring that appropriate communication and education strategies are developed to inform the community about uranium mining;
  • in relation to environmental aspects the Report recommends the Department of Environment and Heritage Protect review the model conditions for environmental authorities for relevance to uranium mining, consider water impacts and in particular high rainfall events. The Australian Government's leading practice guidelines should be used for in situ uranium mining and particular consideration on impacts to the Great Artesian Basin; and
  • the Queensland Government should update guidelines for the industry.

The Report recommends immediate implementation of the recommendations and the first action should be the establishment of the Uranium Mining Oversight Committee. After 31 years uranium mining in Queensland is a step closer to recommencing.

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Clayton Utz communications are intended to provide commentary and general information. They should not be relied upon as legal advice. Formal legal advice should be sought in particular transactions or on matters of interest arising from this bulletin. Persons listed may not be admitted in all states and territories.

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