Friday, 5 January, 2007

AFP

Australia and China have ratified a nuclear agreement clearing the way for the export of uranium to feed Beijing's giant nuclear power programme, Canberra has said.

The agreement providing a legal framework for shipments of the nuclear fuel to the Asian powerhouse will come into force in 30 days, Foreign Minister Alexander Downer said in a statement.

"The timing and quantities of exports will be a matter for commercial negotiation," Downer said.

Australia, which has the world's largest known reserves of uranium, expects to earn some 250 million dollars (187 million US) a year from the deal, a Senate committee was told last year.

China has announced plans to build 28 new nuclear reactors and by 2020 the annual uranium requirement would be about 8,000 tonnes a year, the committee heard.

The deal was finalised by Chinese Premier Wen Jiabao during a visit to Australia last April after 12 months of negotiations over safeguards to ensure the fuel would not be used in nuclear weapons.

The agreement signed by Wen and Prime Minister John Howard commits China to abide by the rules of the
International Atomic Energy Agency and the principles of the Nuclear Non-Proliferation Treaty.

Downer said the agreement was ratified through an exchange of diplomatic notes in Beijing on January 4 after the government's standing committee on treaties gave the go-ahead.

China has already moved to guarantee supplies for its programme, with a Chinese government-owned company agreeing last September to buy a controlling stake in two Australian uranium ventures.

Australian mining company PepinNini said it had signed a memorandum of understanding with China's Sinosteel Corporation for the joint development of the Crocker Well and Mount Victoria uranium deposits in South Australia state.

After reaching the agreement with China, Australia came under pressure from rival Asian giant India to supply uranium for its own nuclear power needs.

Canberra has so far refused, on the grounds that it will not supply the fuel to countries such as India that have not signed the non-proliferation treaty.

But with US President George W. Bush last month signing a landmark civilian nuclear deal with India, the pressure on Australia to export uranium to India is likely to increase.

Howard is a close ally of Bush's and has indicated in the past that his view of nuclear deals with India could be influenced by the US decision.

The agreement creates a rare exception to US law in order to pave the way for US sales of nuclear fuel and know-how to India for the first time since Delhi tested a nuclear device in 1974, becoming an international atomic pariah.