The Conversation (0)
Nov. 22, 2011 04:42PM PST
In an interview with Uranium Investing News, Simon Clarke, Communication Director for the Australian Uranium Association (AUA), detailed his cautionary optimistic viewpoint for the uranium industry, “Indian investors are likely, once permitted, to look for potential investments in Australian uranium assets.”
By Dave Brown – Exclusive to Uranium Investing News
Following a difficult year in many ways for the uranium industry, Australia and India have made some progress in changing the outlook for economic prospects.
Australian prime minister, Julia Gillard is attempting to change the country’s current policy which does not permit uranium sales to India. The hope is that the initiative could further enhance Australia’s mining boom while securing some of the insatiable energy requirements of the emerging Asian powerhouse.
In an interview with Uranium Investing News, Simon Clarke, Communication Director for the Australian Uranium Association (AUA), detailed his cautionary optimistic viewpoint for the uranium industry, “It is very early days. The policy change still has to be accepted by the ALP (Australian Labor Party), then adopted formally by the Government, with a special safeguards framework and bilateral treaty to be developed between Australia and India. This is likely to take several years and, in the meantime, India will be expected to enter supply arrangements with a number of other countries.”
Positive outcomes
As a possible outcome of this trade liberalization of Australian uranium assets might be “that Indian investors are likely, once permitted, to look for potential investments in Australian uranium assets. Chinese and Japanese investors have been actively seeking investment opportunities in uranium and Indian investors are likely to follow. This would be welcomed by the Australian [uranium] industry, which is always ready to consider equity participation and potential uranium off-take arrangements with new investors.”
Capacity limitation
Australia is currently the world’s third largest producer of uranium, responsible for approximately 11 percent of global uranium production. However, investors will note that this significantly under represents the country’s estimated reserves. Forecasting potential global implications of supply and demand shifts regarding policy changes becomes complicated for Australian uranium mining and exploration interests.
Clarke offered, “The scale of likely demand from India for Australian uranium if and when sales are permitted is therefore almost impossible to predict. However, looking at the current situation, it would be true to say the Australian industry would not be in a position now to supply uranium to India without the addition of mining and processing capacity. Considerable additional capacity is likely to be added in coming years, with proposed expansion to the Ranger and Olympic Dam mines; the prospect of new mines being brought into production in Western Australia, the Northern Territory and South Australia.”
As a longer term outlook Clarke indicated, “Our view of official forecasts and company information suggests that Australia could double its production and exports by 2020 and could be exporting as much as 30,000 tonnes per annum of uranium oxide by 2030.”
Increasing uranium demand long term
In keeping with the megatons-to-megawatts program and current global nuclear policy context Clarke proposed, “There is unlikely to be a surplus of production capacity in the short to medium-term. Most forecasts are for a possible shortfall in supply of mined uranium for a period from 2013 onwards, after the completion of current arrangements between the USA and Russia for the downblending of former Soviet Union weapons material for use in civilian reactors and secondary supply provides less of the overall global uranium requirement. Indications are that the global nuclear fleet will continue to grow, though possibly at a slightly slower rate and to a somewhat smaller extent than forecast pre-Fukushima. Uranium producers are currently more concerned about continuing relatively low prices and the AUA notes that official and market observations suggest there is considerable room for Australian production capacity to expand to meet the forecast uranium supply gap if price signals are appropriate.”
Uranium policy changes initiated by India more favorable for uranium producers
Earlier this month, India published new rules to provide liability limitations for uranium producers and equipment suppliers in the case of a serious accident at Indian nuclear power plants.
Last year, India approved legislation to permit nuclear facilities to have a ‘right of recourse’ against equipment suppliers. No other nuclear country includes a similar standard of exclusive liability and financial responsibility in the case of an accident.
The result of this clause so far has been that many global uranium producers have considered India to impose an extra risk premium which has led to some stagnation in the market place. While uranium producers have not indicated if these recent developments provide a more acceptable commercial structure for conducting business, there have been some industry observers that have questioned whether the unusual nature of last year’s Civil Liability for Nuclear Damages Bill might even be subject to international assessment.
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Yath Project - Nunavut, Canada
The Yath Project is Generation Uranium’s flagship project. This 100 percent owned property covers about 120 square kilometers within the underexplored Thelon Basin in Nunavut, Canada. The project is located where the Yathkyed and Angikuni sub-basins meet, which is a region known globally for high-grade uranium potential. It sits directly along the same trend as the Angilak Project owned by ATHA Energy (TSXV:SASK, OTCQB:SASFK, FWB:XSU.F), which contains the Lac 50 deposit, one of the highest-grade uranium resources found outside of the Athabasca Basin with a historical mineral resource estimate of 43.3M lbs at an average grade of 0.69 percent U3O8.
The Yath Project is contiguous to the Lac 50 trend and is crossed by several regional faults and basin boundaries. Past exploration work has already identified high priority targets, while surface sampling in the area has produced uranium grades from boulders, with some testing at 9.81 percent, 3.95 percent, and 2.14 percent U3O8.
The company has commenced its initial field program at the site, set to define and rank drill targets. Historic showings will be combined with new anomalies from the MMT geophysics survey, preparing the project for an anticipated drill permit.
Management Team
Michael Collins - CEO & Director
Michael Collins is a professional geoscientist with nearly 30 years of experience in mineral exploration. He has co-founded several public companies, including Exploits Discovery, Prime Mining (acquired in 2025), and Nuclear Fuels (merged with Premier American Uranium in 2025). He is also currently a director of First Atlantic Nickel.
Christoph Bruening - Director
Christoph Bruening is the founder and managing partner of Value Relations GmbH, a full-service investor relations and public relations agency in Frankfurt with over 25 years of excellence, focusing on mining, exploration, biotech and health care. In addition, he has listed over 600 companies on the Frankfurt Stock Exchange and is a speaker and author of several publications, including on rare earths and uranium.
Dallas Miller - Director
Dallas Miller has been working within the international mining industry for over 15 years, working with BHP and Santos Ltd. He has experience on the ground from an operational standpoint, as well as being an integral part of raising millions of dollars in capital funding for both private and public companies in recent years.
Roger Leschuk - VP Corporate Development
Roger Leschuk has been in corporate management for over two decades, with the past 15 years dedicated to corporate development and investor relations. He has experience participating in and assisting with mergers and acquisitions, and was an investment advisor for various services such as stocks, mutual funds and tax-sheltered investments. He is a Chartered Investment Manager and a Fellow of the Canadian Securities Institute.
Monty Sutton - CFO
Monty Sutton brings over 35 years of experience in public markets and corporate governance. He previously served as CFO for Nuclear Fuels from its IPO through its acquisition.
