Uranium miners face new hurdles as Fukushima disaster worsens

Wed Aug 21, 2013 4:14am EDT
 
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By James Regan

SYDNEY (Reuters) - Revelations of more toxic leaks from Japan's Fukushima Daiichi nuclear power plant will raise second-thoughts about Japan's nuclear future, but won't halt the long-term global expansion of the industry, the head of a uranium mining company said.

"It reinvigorates the heightened state of nervousness, it surely will make the Japanese government and nuclear regulatory authorities more cautious and conservative in the decisions about the restart," said Vanessa Guthrie, managing director of Australia's Toro Energy Ltd TOE.AX, which expects to start mining uranium in Australia in 2016.

Japan is set to raise the severity rating of the leak to level 3, or "serious incident", on an international scale for radiological releases, underlining a deepening sense of crisis at the site.

The price of uranium, used mainly as fuel for nuclear reactors, plunged after the March 2011 meltdown at the Fukushima plant 240 km (150 miles) from Tokyo and has struggled to recover ever since.

August uranium futures stood at $35.15 per pound on Wednesday compared with $68 per pound before the earthquake and tsunami that triggered the disaster.

However, Guthrie said contract prices between uranium miners and buyers standing at around $58-$59 a pound more accurately reflect the supply and demand balance than the spot price.

Operating costs in the industry range between $22-$25 per pound up to the high $40s, Guthrie said.

Canadian miner Uranium One Inc UUU.TO, which Russian nuclear corporation Rosatom plans to consolidate and take private this year, expects uranium prices to almost double in a couple of years amid dwindling supplies.   Continued...

 
A haul truck is seen carrying uranium ore out of Energy Resource Australia's Ranger uranium mine in Australia's Northern Territory in this handout photograph obtained September 2, 2008. REUTERS/Rio Tinto/David Hancock/Handout