BHP says ‘nuclear renaissance’ helps Olympic Dam expansion case

afr.com:

BHP chief executive Mike Henry says stronger uranium prices will boost the business case for an expansion of South Australia’s Olympic Dam copper precinct, which would in turn allow BHP to grow its uranium output.

Uranium prices have rallied to a 12-year high in the past month as nations like Japan, China, Canada, Turkey, the United States and South Korea flag plans to open new nuclear power reactors.

BHP produces uranium at Olympic Dam as a byproduct. 

Japan’s gradual restart of nuclear reactors after the 2011 Fukushima nuclear accident is likely to be a topic of debate this week when senior Japanese and Australian business leaders meet for a summit in Melbourne.

BHP produces uranium at Olympic Dam as a byproduct, and Mr Henry said the mine’s focus on copper meant there was little scope to increase uranium output in response to the recent rally in prices for the controversial commodity.

But he said strong uranium prices may indirectly lead to higher uranium export volumes from South Australia because it would make an expansion of Olympic Dam more viable.

“In a world of a nuclear renaissance you would expect that the supply demand equation works such that that gives rise to higher uranium prices which then could flow back to making that expansion opportunity more economic,” he told The Australian Financial Review.

BHP consolidated the copper, gold and uranium assets around Olympic Dam this year when it acquired OZ Minerals for $9.6 billion.

Mr Henry has previously dangled the possibility that copper output from South Australia could be raised by 50 per cent if BHP invested in a “two-stage smelter” at Olympic Dam.

He told theFinancial Review BHP was likely to produce more uranium as well if the bigger smelter were