With the world's highest recoverable uranium
resources, Australia will benefit from supplying the resource to
India, one of the world's fastest growing energy
Australia has now signed a bilateral "nuclear
co-operation" agreement for the supply of uranium to India.
This comes after the Federal Government's overturn of a
longstanding ban on uranium sales to India in 2011 and a further
two years of negotiations between the countries.
The agreement makes India the first country that is not a
signatory to the Nuclear Non-Proliferation Treaty to receive
uranium from Australia. Despite this, the safeguards set out in the
bilateral agreement aim to ensure that the uranium provided to
India remains for exclusively peaceful use, effectively placing
India in line with Australia's obligations under the Nuclear
The bilateral agreement is not yet publically available and it
will now need to be tabled in Parliament and be considered by the
Treaties Committee. However, we expect that the bilateral agreement
will reflect many of the key terms of the Nuclear Non-Proliferation
Treaty, as well as those required by the International Atomic
Energy Agency, including: that Australian uranium is only
transferred to third parties with Australian consent; that the
uranium is kept physically secure; and that Australian uranium is
not used for, or diverted to, nuclear weapons programs.
With the world's highest recoverable uranium resources,
Australia will benefit from supplying the resource to a country
that is one of the world's fastest growing energy markets.
India is predicted to become a major user of nuclear energy over
the next 15 years, increasing its nuclear capacity to 14.6 GW.
India currently has 21 operable nuclear power reactors, six under
construction and a further 57 that are the in early planning
The Commonwealth Government policy on uranium has gradually
shifted over the past 10 years, with the abandonment of its
"No New Mines" Policy in 2007 after entering into the
Australia-China Transfer of Nuclear Material Agreement and the
Agreement for Cooperation in the Peaceful Uses of Nuclear Energy
(AC Agreements) in 2006. Australia now exports uranium to the
European Union, Japan, USA, China, South Korea, Canada and Taiwan.
Although Australia entered into a bilateral agreement with Russia
in 2010, Australia announced a ban on uranium exports to Russia in
September 2014 until further notice.
Over the last 15 years we have seen a significant change in
Commonwealth, State and Territory uranium mining policy with the
lifting of the Federal "two mines policy" and Western
Australia, Northern Territory and South Australian governments all
now support uranium exploration and mining.
The ban on uranium mining in Queensland was removed in July of
this year and the Mary-Kathleen uranium mine near Mt Isa will be
open for tenders in the coming months. The reopening of
Mary-Kathleen is said to unlock $4 billion worth of mineral
resources, with "a potential royalty value for the State of
more than $100 million".
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.
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