Australia, China sign uranium trade deal

By Michelle Nichols

CANBERRA (Reuters) – Australia and China signed a nuclear
safeguards deal on Monday that set the stage for huge uranium
exports to Beijing for its power industry, but Canberra said
the trade was unlikely to start for some years.

Australian Foreign Minister Alexander Downer and his
Chinese counterpart, Li Zhaoxing, signed the nuclear safeguards
deal in the presence of visiting Chinese Premier Wen Jiabao and
Australian Prime Minister John Howard.

“Given China’s high projected growth in electricity demand
over the coming years, there are clear environmental benefits
in diversifying from fossil fuels to low greenhouse-emission
technologies such as nuclear power,” Downer said in a
statement.

China is expected to build 40 to 50 nuclear power plants
over the next 20 years and needs steady supplies of uranium.
Its own uranium stocks are dwindling, not very rich and
difficult to extract.

Australia has about 40 percent of the world’s known uranium
reserves, but it will only export to countries that have signed

the UN Nuclear Non-Proliferation Treaty (NPT) and who also
agree to a separate bilateral safeguards deal.

India also wants to buy uranium from Australia, but has not
signed the NPT and Howard has said he was not planning to
change his strict uranium trade policy just because New Delhi
signed a nuclear technology deal with the United States.

The U.S.-India deal agreed last month requires New Delhi to
separate its military and civil nuclear facilities and open
civilian plants to inspections in return for U.S. nuclear fuel
and technology, but still needs approval from the U.S.
Congress.

Australia only has three operating uranium mines, owned by
BHP Billiton, Rio Tinto and General Atomics of the United
States, and Resources Minister Ian Macfarlane has said big
uranium exports to China were unlikely to start until 2010.

Macfarlane said China’s predicted uranium consumption was
estimated at 20,000 tons a year, while Australia currently
produced only about 10,000 tons a year from its existing three
mines. He said extra capacity would be needed to supply China.

“WORLD LESS SAFE”

Australia has 19 bilateral nuclear safeguard agreements
covering 36 countries, including the United States, France,
Britain, Mexico, Japan, Finland and South Korea.

The NPT requires the five nuclear-weapon states — Russia,
the United States, United Kingdom, France, and China — not to
transfer nuclear weapons, other nuclear explosive devices, or
technology to non-nuclear-weapon states and non-NPT countries.

“I’m firm in the belief that with the considered effort of
both countries, China-Australia relations and cooperations will
yield rich fruits,” Wen told a lunch at Parliament House.

About 25 human rights protesters gathered out the front of
Parliament House in Canberra in opposition to Wen’s visit,
including a former Chinese diplomat who granted residency in
Australia after he first sought political asylum.

Minority Australian Greens party politician Christine Milne
said Australia was putting money before human rights and global
security by allowing communist China to import uranium.

“Make no mistake — selling Australian uranium to China
will make the world less safe,” Milne said in a statement.

Australia and China are also negotiating a free trade deal
and Wen said the two countries had agreed to accelerate talks.

“That is in the next one or two years China and Australia
should work together to strive for breakthroughs on major
issues related to the FTA negotiation … to lay the foundation
for the arrival of an overall agreement,” Wen said.

Howard praised Wen and said that the nuclear and other
deals signed on Monday highlighted the countries developing
ties.

“You represent a leader of a remarkable nation which is
destined to play an even greater role in the affairs of the
world and a nation with which Australia seeks to build an ever
closer, more effective and more permanent partnership,” Howard
said.

Some analysts say the safeguards deal with China will test
Australia’s skills at juggling growing ties with Asia’s
emerging power and its strong alliance with the United States,
which is wary of Beijing’s military and economic ambitions.

($1=A$1.40)