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Client Update: Uranium mining ban lifted in Queensland

24 October 2012

In brief: Queensland Premier, Campbell Newman has announced that Queensland has overturned its long-standing ban on uranium mining. Senior Associate John Hedge reports on the change in policy and the consequences for development of uranium projects in Queensland.

Background

Uranium mining ceased in Queensland in 1982, and although successive Queensland governments have not granted leases for uranium mining since then, they have been willing to grant exploration permits for the resource.

As recently reported, in September the Queensland Government flagged an intention to reopen the debate on whether uranium mining should be permitted in Queensland.

Uranium mining and exports then stayed in the headlines due to the Federal Government's recent agreement to commence negotiations with India on safeguards which would allow uranium sales for power generation in that country.

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The announcement

On 22 October, the Premier and Minister for Natural Resources and Mines announced the decision to overturn the existing policy ban on uranium mining in Queensland.

The announcement opens the door to uranium mines being developed in Queensland to supply traditional export markets for Australian uranium and emerging markets such as India. It also brings Queensland into line with a number of other Australian jurisdictions (Western Australia, South Australia and the Northern Territory), which permit uranium mining.

The announcement has been widely welcomed by resources industry bodies and uranium companies, but remains opposed by some environmental groups and the Queensland Opposition.

The announcement is restricted to uranium mining for export and confirms that there are no plans to consider nuclear energy production or nuclear waste disposal in Queensland.

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Implementation in Queensland

As the policy was never enshrined in legislation, there is theoretically nothing preventing companies holding uranium exploration tenements in Queensland applying for mining leases in the near future.

However, the Premier indicated that the resumption of uranium mining in Queensland is to be overseen by a three-member implementation committee (the members of which are yet to be announced) that will report to the Queensland parliament in three months. Consequently, there is likely to be a short interim period in which the Government seeks to define the policy parameters surrounding future grants of uranium mining leases.

It is anticipated that the proponents of the most advanced Queensland projects will eagerly await the outcomes of that report and the Government's reaction to it, which it is hoped would:

  • confirm the major principles of the future regulatory framework to apply to uranium mining in Queensland; and
  • provide the degree of investment certainty required for project proponents to obtain financing and consider proceeding to a mine development decision.

In the meantime, it would be expected that the most immediate impacts of the announcement will be a reinvigoration of interest in uranium exploration in Queensland by providing a more certain pathway to production if commercially viable discoveries are made, and creating a greater potential for acquisitions in the sector, including existing tenement holders selling down stakes in projects with a view to funding exploration and development costs.

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