A typically dusty drive 25 kilometres south of central Australia's Alice Springs brings you to an unlocked gate beside the old Ghan railway line. 

Behind the fence, among the rolling red desert hills, drilling workers are boring 120 holes into an area of earth said to contain about 12,000 tonnes of uranium oxide. The ore is worth up to $2.5 billion. 

The uranium deposits, named Angela and Pamela, were first discovered in the 1970s and '80s, but lay dormant until a new exploration licence was granted by the Northern Territory government late last year. 

Canadian company Cameco and Australian-owned Paladin, the two businesses involved in the joint venture, hope to build Australia's fifth uranium mine - well inside the Alice Springs water catchment boundary. 

In July, environment minister Peter Garrett approved the nation's fourth uranium mine at the Four Mile site in South Australia. The Angela Pamela exploratory licence is part of the NT's push to expand its mining industry in response to a global surge in demand for uranium. 

But a growing chorus of Alice Springs residents and tourism operators say the health risks of a uranium mine outweigh any economic benefits. 

Family and medical groups have expressed grave concerns about Cameco's recent history of radioactive leaks and flooding accidents in its uranium mines. 

If built, the Angela Pamela uranium mine will be less than 15 kilometres away from existing and proposed bore fields for the Alice Springs' drinking water. 

Cameco, the world's largest producer of uranium, flooded its Cigar Lake mine in Canada in 2006, leaving the world's single largest uranium deposit underwater. Efforts to remove the water have so far failed. 

In 2007, the company detected a radioactive leak at its Port Hope conversion plant. A similar leak was uncovered in 2001. Last year it paid US$1.4 million to the US state of Wyoming for failing to comply with a host of environmental standards at its Smith Ranch-Highland facility. 

Cameco said its preliminary groundwater tests had found no connection between the uranium deposit and the Mereenie Aquifer, which supplies water to Alice Springs. However, it refused to guarantee that contamination won't occur. 

In contrast, NT chief minister Paul Henderson gave his "absolute assurance" in October 2008 that Alice Springs residents would be safe. 

Arid Lands Environment Centre coordinator Jimmy Cocking told Green Left Weekly the chief minister's promise "demonstrates the government's arrogance towards the people of Central Australia". 

"We've got a big mining company, which has caused all these groundwater problems around the world, coming into our town and telling us to trust it with our precious water source", he said. "It's an unacceptable risk for Alice Springs and an unacceptable precedent for the government to be setting. 

"Both the nuclear industry and the government are relying on the fact that because we're so far away from the big cities this issue will be out of sight, out of mind. 

"If this is allowed to happen a lot of families will leave the town and we need to stop this now before exploration is finished and a full mining application is submitted. 

"Who really wants to go to a place where if the wind blows up from the south - like it does here almost every day - there's a possibility that you're breathing in radioactive dust?" 

Tempers flared at a community meeting in March when NT primary industries minister Kon Vatskalis admitted he did not know about Cameco's history in Canada before he granted it an exploration licence. 

Vatskalis told GLW any proposal for a new mine was subject to strict environmental approvals processes. "Where a proposed mine is in the vicinity or catchment of a town water supply, thorough hydrogeological studies would be required to establish that there is no likelihood of contamination of the water supply before any approval to mine is granted." 

He said Cameco had been operating in the NT for 16 years and had "consistently met their social and environmental responsibilities". 

"They have a good record of environmental performance in the Territory", he said. "Any application for the mining of uranium would trigger a formal environmental assessment under Commonwealth legislation that will include a rigorous assessment of dust and water contamination issues." 

But Don Wait, owner of Wayoutback Tours, is furious the government would consider risking the red centre's multi million-dollar eco-tourism industry. 

"What bloody idiot came up with the idea of a uranium mine in the water catchment?" he told GLW. "Governments are responsible for looking after people, not putting them in jeopardy. 

"Travellers come here from all over the world to experience our unique untouched natural landscape. The investment in tourism in this area has been massive for a large number of years and you can ruin our reputation overnight by plonking a uranium mine right next to Alice Springs. The consequences are just outrageous. 

"They say it's going to create jobs but there is a glut of work in this town. I have to get backpackers to fill positions." 

A survey of 306 travellers carried out by Wait's company found 20% would not return to Alice Springs if a uranium mine went ahead. Forty-four percent said they were unsure.

Vatskalis said the mine would have "a relatively small footprint and is not likely to be visible from any of the major tourist attractions in and around Alice Springs". 

"The presence of the Ranger uranium mine within Kakadu National Park has not prevented a thriving tourist industry in that region", he said. 

Beyond Nuclear Initiative campaigner Nat Wasley said it was "ludicrous" for the federal and territory governments to use the Ranger uranium mine as an example of good practice. 

"The Commonwealth's own scientist revealed in March that 100,000 litres of contaminated water is leaking from the [Ranger] mine into the ground beneath Kakadu every day", she told GLW. 

"If those are the problems they're having at the most heavily regulated uranium mine in Australia, if not the world, one can only imagine what might happen down the track at Alice Springs." 

The federal Labor party controversially dumped its "no new mines policy" in 2007. Since being elected, the Rudd government has tried to sell Australia's credentials as a dominant supplier of uranium. Australia has the world's largest supply of uranium - about 24% of the planet's known reserves. 

But Monash University civil engineering lecturer Dr Gavin Mudd said US President Barack Obama's push for a cut in the world's nuclear weapons stockpiles would lead to a collapse in uranium prices. 

"A lot of the uranium from those nuclear warheads would flood the energy market post-2013 and make the arguments for new mines completely botched", he told GLW. "You can already see the jitters from uranium miners over some of these concerns." 

"With expanded production capacity coming out of South Australia's Olympic Dam it's really hard to imagine a scenario where a project like Angela Pamela is going to be economically viable." 

Mudd said it was "silly" to say a uranium mine posed no risk to the Alice Springs water supply. 

"If they've got an open-cut mine or an underground mine they have to build a tailings dam. The fact remains that every tailings dam leaks. It's not a matter of if; it's a matter of how much and what the potential impacts are likely to be." 

Cameco's project manager Stephan Stander said there was a lot of misinformation about the company's overseas operations and that it was "extremely focused on environmental management". 

"I don't think anybody can give a 100% guarantee that we won't have a [contamination] event somewhere in the future", he told GLW. "But I honestly don't think any such event would be unmanageable and I don't think it would impact meaningfully on the town's water supply or anybody's safety. 

"All the indications in terms of water quality that we've tested at that site indicate there is not a connection between the site and the town's water supply." 

He said the Angela Pamela deposit was an attractive mine site because of its proximity to infrastructure, its shallow location and its potential for relatively easy extraction. It was likely that Cameco-Paladin would use an underground mining method with a "very small open-cut area". 

Stander said a mining application licence would be submitted by the end of next year and that Cameco, which has already opened an office in Alice Springs, was committed to establishing itself as a "valuable and important part of the community". 

"Our ultimate aim is for at least 40% Indigenous employment, which is the percentage we have at some of our Canadian operations", he said. But he admitted it would be a challenge to find sufficiently skilled people from the local region. 

Mitch, a spokesperson for affected Indigenous families at Angela Pamela, said Aboriginal people were being forced to override their cultural rules by joining the uranium venture. 

"You have to take the job that's offered to you because under the intervention you get your welfare payments cut off for eight weeks if you don't attend job appointments", Mitch told GLW. "They've pushed our people into a really hard situation." 

"They're not high-paying jobs and Indigenous people will be on the pick and shovel because they don't have the skills in the industry. 

"We see it as a breakdown in our social networking and we open ourselves up to a mining culture that we don't want." 

Mitch said under traditional beliefs the Angela Pamela uranium deposits were located on "poison" land. 

"It's all women's country through there and we have strong laws that this part of country can't be touched because it is poisonous; it is no good land. 

"We've tried to tell that to Cameco-Paladin but they're able to break down the culture through money. We feel powerless in that way."