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25 Oct 2012

Queensland uranium mining to re-commence

Queensland Premier Campbell Newman has made a decision to re-commence uranium mining in Queensland following the previous Labor Government's decades-long policy to ban uranium mining in Queensland.

The State Government announced it will convene a three-member implementation committee to oversee the recommencement of uranium mining in Queensland (however, nuclear energy production or nuclear waste disposal plants in Queensland will remain off-limits). The Government-appointed committee will prepare a report on uranium mining within three months.

This policy is consistent with the movement by other States and the Federal Government to approve the exploration, mining and sale of uranium.

Queensland already has an estimated resource base of at least 37,000 tonnes of uranium. Natural Resource and Mines Minister Andrew Cripps said Queensland's known uranium deposits are worth an estimated $10 billion. The two main deposits of uranium are located outside Mt Isa and on the Gulf of Carpentaria. The last uranium mine in Queensland, the Mary Kathleen mine, was closed in 1982, and extracted a total of 7 million tonnes of uranium ore.

Uranium exploration in Queensland has not been subject to the prohibition and there has been continued interest for uranium exploration.

The previous Labor Government policy against uranium mining in Queensland was never incorporated within legislation, but was implemented by way of the State Government refusing to grant any mining leases for the purposes of mining uranium under the general terms of the Minerals Resources Act 1989 (Qld) (MRA). This means that significant legislative changes will not be necessary in Queensland to facilitate uranium mining given that uranium falls with the defined scope of "mineral" under section 6 of the MRA. However, it is likely that, similarly to when the ban was lifted in Western Australia, the government-appointed committee will prepare a report on whether additional legislation, policies and approvals will be required.

The Government has not mentioned in its statement if there will be any amendment to the royalty rate for uranium mining which in Queensland is currently 2.5% (for "other minerals"). For example the royalty rate for uranium oxide in Western Australia is currently 5%.

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Clayton Utz communications are intended to provide commentary and general information. They should not be relied upon as legal advice. Formal legal advice should be sought in particular transactions or on matters of interest arising from this communication. Persons listed may not be admitted in all States and Territories.