Aussie uranium miners shrug off US import scare
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A US investigation into uranium imports is creating a stir in the market, but the boss of one ASX-listed explorer says Australian players have nothing to worry about.
The Trump administration yesterday announced an investigation into the effects of imported uranium on national security.
“Everyone is getting in a bit of a twist over this,” said Mike Young, who heads up Vimy Resources (ASX:VMY) which has one of Australia’s biggest undeveloped uranium resources in Western Australia’s Great Victoria Desert.
“The probability of Australia being frozen out of the US market is so remote it’s ridiculous,” Mr Young said.
The investigation by the US Commerce Department will report its findings to President Trump in nine months.
Mr Trump then has 90 days to implement whatever measures he deems appropriate.
The investigation follows a petition filed by two US uranium producers in January suggesting the import of uranium products threatened national security.
The uranium producers want the US government to impose restrictions on imports that require US utilities to buy 25 per cent (or 12 million pounds) each year of their uranium supply from domestic producers.
In 2017, the US produced 2.4 million pounds of uranium concentrate – 16 per cent less than the year before, according to the US Energy and Information Administration.
“The application in its current form would require US producers to mine more uranium per year than they have done since the 80s when approvals were much simpler,” Mr Young said.
“The application is very unlikely to get up in its current form and we’ll continue to monitor it.”
Vimy is advancing its WA “Mulga Rock” uranium project towards production.
The mine is expected to produce 47.1 million pounds of uranium over 15 years.
ASX-listed uranium producer Peninsula Energy (ASX:PEN) — which has operations in Wyoming — said yesterday the investigation might actually be good for the uranium industry.
“Our company is respectful of the economic impacts that this investigation may have on many of the participants in the US nuclear energy sector, including our valued customers,” chief Wayne Heili said.
“Having the [US Department of Commerce] examine the impact that imports have on the struggling domestic industry may provide a valuable framework to improve the overall fundamentals of our industry.”