May 14, 2009 / 4:13 AM / in 9 years

Australian error reveals China uranium export plan

CANBERRA, May 14 (Reuters) - Australia plans to increase uranium sales to China provided it is not used in Beijing’s expanding weapons programme, documents mistakenly made public by Australia’s foreign minister showed on Thursday.

Foreign Minister Stephen Smith tabled in parliament a confidential list of treaty negotiations with other countries, revealing details of negotiations between Australia and China about lifting exports of uranium from BHP Billiton’s (BHP.AX) Olympic Dam mine in South Australia.

The treaty document said Australian diplomats attended talks in Beijing in January on BHP Billiton’s proposal to send uranium-infused copper concentrate to China from Olympic Dam.

BHP is currently undertaking a two-year feasibility study into the expansion of Olympic Dam, which is the world’s largest uranium deposit, fourth largest remaining copper deposit and fifth largest gold deposit.

GOVERNMENT APPROVAL NEEDED

Expansion, which requires government approval, would transform the underground facility into one of the world’s biggest open pit mines, with output rising six-fold.

Russia, China and India are all anxious to buy Australian uranium to develop civilian nuclear energy. Australia has 40 percent of the world’s recoverable uranium.

The Labor government is refusing to sell nuclear fuel to India because it has not signed the Nuclear Non-Proliferation treaty. Australia is one of 35 International Atomic Energy Agency board members and already sells uranium to 36 nations.

“In the case of the information that was put out on the trade negotiations, there was nothing in that document that isn’t already in the public domain,” Crean said.

A current uranium export agreement between Australia and China focuses on supply of uranium in uranium ore concentrates. An annex allows for extraction of uranium from other ores and concentrates, but only for non-nuclear purposes.

“An amendment or supplementary agreement is required to ensure Australian uranium is satisfactorily accounted for during the extraction process, and that any uranium extracted becomes nuclear material subject to the provisions of the nuclear transfer agreement,” said the document tabled by Smith.

$1=A$1.307 Additional reporting by James Grubel; Editing by David Fox

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