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Uranium’s future looks bright

By Lionel Williams – Editor, esiafrica.wpengine.com

A few months have passed since the Fukushima nuclear plant crisis in the wake of the devastating earthquake and tsunami that struck Japan “’ and the after-effects of the triple disaster remain with us as strongly as ever.

In the days following the initial plumes of radiation from the Fukushima reactors, it became clear that the US was perhaps feeling the first tremors of change coming for nuclear safety. American congressional lawmakers were calling for a shift in how the country should deal with possible radiation threats from American nuclear power plants, and suggested changes were both broad and extremely specific.

The Japanese crisis could lead to a major reassessment in European countries that are already building such plants or are considering a shift from fossil fuels to nuclear energy to combat climate change. British, French and German officials tried to reassure the public that no such accidents could occur in their countries “’ or for that matter, anywhere in Europe, given the continent’s geology.

In Eastern Europe, in Poland, Lithuania, Bulgaria and Romania, governments differed in their response to the Japanese disaster, but they still agreed on needing nuclear power.

Poland, which is trying to weaken its dependence on Russian energy in part by developing nuclear power, reacted cautiously. “Our plants will be built to provide maximum security,” prime-minister Donald Tusk said, “but let’s be honest, Poland is not a seismically active country.”

Lithuania, the Czech Republic, Slovakia and Romania have been trying to develop nuclear power as well, but their decisions have become embroiled in politics.

The Chinese government reacted to the crisis in Japan by announcing a moratorium on nuclear project approvals, pending a review of their nuclear safety plans. But many critics strongly doubt the Chinese government will alter its course, with 13 operating nuclear reactors, 27 under construction, 50 planned, and 100 more proposed. By 2020, the country’s nuclear capacity is expected to increase tenfold.

While the disaster in Japan darkened the mood at an international nuclear conference in the United States, officials said it would not change the outlook for the nuclear industry, and blamed the media for stoking fear. Speakers at the World Nuclear Fuel Cycle conference in Chicago, which is attended by uranium producers and buyers from all over the world, kept referring to nuclear power as a cleaner option than fossil fuels.

“The world needs our industry to combat global warming. We need to succeed.” said Kenneth Peterson, vice president of Exelon Corporation, the largest US nuclear power plant operator.

It seems to me that, once one had ploughed through the mass of international reaction to the triple disaster that devastated part of Japan and crippled Fukushima, reaction at government level varied from panic to reluctant acceptance that nuclear power was here to stay, while the nuclear industry itself “’ perhaps understandably “’ had a highly optimistic view of the outlook for the future.

It also struck me that this all seemed to gel into good news for the providers to the nuclear industry “’ the uranium miners.

As things stand, over 16% of the world’s electricity is generated from uranium in nuclear reactors. This amounts to about 2,400 billion kWh each year. In a current perspective, it is twelve times Australia’s or South Africa’s total electricity production, five times India’s, twice China’s and 500 times Kenya’s total.

This electricity comes from about 440 nuclear reactors with a total output capacity of about 370,000 megawatts (MWe) operating in 31 countries. About 30 more reactors are under construction and another 40 are planned.

Extract Resources CEO and managing director Jonathan Leslie seemed to sum up the nuclear industry’ sentiments in an interview with me when he said: “Sure, there is general consensus that we do have to wait and see how events play out in Japan, but I feel that while we may have some delays in demand in the short term “’ I am certain that the long term outlook is excellent. For me the case for nuclear power remains intact.”

“And I think that this is a general view that’s beginning to emerge “’ a sort of consensus view that growing and hungry nuclear industry will automatically trigger success for the uranium industry in general, and for uranium miners like ourselves in particular.”