russia signs deal

Russia, Australia ink uranium deal

Friday, 7 September 2007

A DEAL has been signed for Australia to export uranium to Russia for use in it's civilian nuclear reactors.



Russian President Vladimir Putin, who landed in Sydney today ahead of this weekend's APEC Summit, and Prime Minister John Howard signed the deal after talks this morning.

Russia is a signatory to the Non-Proliferation Treaty (NPT) and is one of the five nuclear powers recognised by that agreement.

Earlier today, Foreign Minister Alexander Downer rejected concerns on ABC Radio over whether Putin could be trusted not to divert Australian uranium for military use or to sell it on to countries such as Iran.

"The Russian nuclear power industry is completely under international atomic agency safeguards in the way that America's is or France's or whoever else we may sell uranium to," he said.

Last month, Australia officially decided to ship uranium to India even though India is not a signatory to the NPT.

Meantime, the spot price for uranium dropped dramatically in August from $US123 per pound at the start of the month to $85/lb at month-end, uranium specialists TradeTech said.

"This decrease in the price is largely due to the presence throughout the month of sellers driven by cash requirements, such as the US Department of Energy," TradeTech said.

However, Australian uranium play Paladin Resources' managing director John Borshoff yesterday described the dip in uranium spot prices as "almost shenanigans".

"There will be an adjustment and it will then continue on an ever upward path," Borshoff said at the Africa DownUnder Conference in Perth.
Borshoff said the uranium exploration and mining sector did not have the capacity to meet global demand for uranium.

"We are talking about building a whole new mining supply industry from a sector that has been dead in the head for 20 years, but now faces trying to meet massive demand from a sleeping mode starting point," Borshoff said.

"Some 32 reactors are under construction and a further 288 are planned across 28 countries.

"Current global output is 103 million pounds of uranium oxide but this will grow to 190 million pounds by 2010 and 250 million pounds by 2020.

"That means we will need at least 25 new uranium mines in production within 13 years."

Shares in Paladin were trading up 6c at $5.86 this morni