URANIUM ROYALTY (NORTHERN TERRITORY) BILL 2008
Dr JENSEN (Tangney) (8:07 PM) —I rise to support the Uranium Royalty
(Northern Territory) Bill 2008. On the surface this bill may appear
little more than a sensible rearrangement of royalty regimes in the
Northern Territory. This would not normally be seen as having any great
impact on the country. However, this bill does in fact have several
extremely significant wider ramifications, of which I shall speak.
Firstly, there is the signal of the growing independence of the Northern Territory. There has always been an idea that somehow the Territory is a poor relation of the other states and somehow less able to run its own affairs. This is highlighted in the issue of uranium. When the Commonwealth government granted the Northern Territory self-government in 1978 there were some areas of control kept by the federal government, one of which was the ownership of uranium. This meant that royalty arrangements were made on a case-by-case basis, making it almost impossible for there to be any coherent and accurate assessment by companies as to the viability or otherwise of potential projects in the Northern Territory. Anyone who knows anything about developments, especially on the sort of scale needed with these projects, understands that the more certainty companies have, the more likely the project is to proceed. It is also often the case that mineral deposits are not just uranium. In some cases there are other deposits as well—copper, for example. Therefore, freeing up these deposits of uranium may well enable other valuable mineral resources to be mined as well, further adding to the wealth of the region, which is even more important than ever in these times of economic gloom and doom.
Therefore, this is quite a watershed moment for the Territorians. The first consideration is: what sort of revenue are we talking about? Energy Resources of Australia, ERA, produces about 11 per cent of the world’s uranium oxide, coming entirely from the Ranger mine in the Alligator River region of the Northern Territory. It is sold only for the generation of electricity under strict international safeguards monitored by the Australian Safeguards and Non-Proliferation Office and the International Atomic Energy Agency. The Northern Territory has also given the green light for exploration on the Angela and Pamela prospects, which are said to contain more than 12,000 tonnes of uranium oxide, worth up to $2.5 billion. Of course, as world demand for uranium increases, the price is driven up. One source says that, after a three-year low of around US$40 a pound in early November 2008, the uranium price has soared to US$53 a pound only two months later. Long-term prices are expected to be around US$65 a pound.
The second important aspect of this bill is the revenue flow to local Aboriginal communities. I think it is fair to say that in the last few years there has been more scrutiny than ever of Aboriginal communities—how their people live and how royalties can be used to provide real benefits for their people. These royalties can be used to provide essentials such as better housing, good quality water and other important services such as education, health and community services. Hopefully the mistakes of the past will remain in the past and this new opportunity will be taken with both hands by local leaders and provide palpable and permanent benefits for the local Indigenous population. There are also other benefits. A recent newspaper article said that ERA employs approximately 500 full-time employees, with 18.5 per cent Indigenous employees, a figure that has nearly doubled in the past two years. The company also promotes indirect employment opportunities, facilitates skill development and supports Aboriginal business enterprises.
With the change in the WA government, local Indigenous leaders held a conference late last year. This was aimed at educating traditional owners and industry on uranium issues, the environment and native title implications. Hopefully in the near future WA Indigenous communities will start to reap the benefits which will soon be flowing to the Northern Territory people. This revenue flow and the employment and other opportunities that come with it hold great potential for Indigenous people. It should provide an encouraging and inspirational showcase of what can be achieved when people of goodwill get together and work for the benefit of all. As I said in my speech of a year ago, we need to break the cycle of dependency, vulnerability and despair pervasive in some Indigenous communities. These royalties could be the circuit-breaker, enabling the next generation of Indigenous Australians to reap the benefits of mainstream Australian society.
The third important aspect of this bill, and possibly the most significant, is the realisation by most members of the government that nuclear power is again being seen as the energy saviour of not just developed but developing countries. For far too long Labor Party policy on uranium mining has been at best contradictory and illogical and at worst detrimental to the nation’s economy. Its intellectually incongruous three-mines policy put the intelligent, pro-resource development members of the Labor Party at constant odds with ideological Luddites who are still carrying banners and mouthing slogans of the Cold War. Thankfully sanity has prevailed, due in no small part, I suspect, to several sensible senior ALP figures who realise the three-mines policy is untenable and ludicrous. Their force of argument has finally dragged most of the rest of the ALP into the 21st century
South Australian Premier Mike Rann has moved to end uncertainty over the Olympic Dam project with an expansion worth $7 billion to produce copper, gold and uranium. The Premier said the mine was valued as a ‘trillion dollar resource’. Of course, Mike Rann as ALP president pushed hard for Labor to scrap its ‘no new mines’ policy last year.
There is still the recalcitrant rump of naysayers in the WA Labor Party but thankfully we now have a Liberal-National government there, which has wasted no time fulfilling an important election promise and opened up my home state to the huge potential which uranium mining presents. Current WA ALP leader Eric Ripper had his ears well and truly pinned back by the federal Minister for Resources and Energy, who accused him of patently false and irresponsible scaremongering on the issue of uranium mining. This is the same minister who was in the Northern Territory about 30 years ago working for the union representing uranium miners.
Mr Gray —He was pro-uranium.
Dr JENSEN —Exactly. That is precisely what I was saying. This was about the same time that Midnight Oil first started haranguing Australians about the evils of uranium.
Mr Gray —They were not pro-uranium.
Dr JENSEN —Definitely not. Those personal histories must add a bit of spice to Labor cabinet meetings.
The Australian Workers Union also savaged WA Labor over its ideological opposition to uranium mining and urged it to fall into line with current federal ALP policy. Secretary Paul Howe said:
It’s not the 1980s. Labor in WA needs to demonstrate they are interested in developing the economy of the state.
This ideologically atavistic position of WA Labor is very damaging, as Paladin MD John Borshoff said:
You can’t operate in a regime where you have to ignore the policies of an elected government for fear of what a change in government would bring—that is the very definition of sovereign risk and the behaviour of a Third World country.
Then there is the implication of the energy future for many countries, especially in Europe and Asia. There has been a growing realisation in Europe and Asia that for a variety of reasons—some valid and others less so—nuclear energy is the only solution to a series of problems.
The Weekend Australian recently heralded the return of Sweden to the nuclear family. New reactors will be built there for the first time in nearly 30 years. This is despite Sweden having extensive hydro-generating capacity. According to the report, even after the four-party coalition was split three to one, the dissenting party leader still supported the move to nuclear energy:
I am doing this for the sake of my children and grandchildren.
The article noted that there is the added concern ‘about the reliability of Russian-supplied fuel after Moscow’s gas dispute with Ukraine last month’. Poland is planning on having its first nuclear plant by 2020 and Britain has decided to replace its ageing reactors and create new sites. France, which is the nation most dependent on nuclear energy—about 75 to 80 per cent of France’s energy is nuclear generated—has ordered its 61st nuclear generator. Finland is building the largest reactor in the world, a third-generation pressurised water reactor, which is expected to open in 2011.
China indicated last month that it may consider increasing nuclear generation capacity from nine gigawatts to 70 gigawatts by 2020—an enormous increase. An MIT report said China may have to add as many as 200 nuclear plants by 2050 to meet its energy needs. There is also a huge market in India, which has been a contentious issue that Australia cannot ignore. That was pointed out by Greg Sheridan nearly four months ago when he noted:
A single statement in support of uranium sales by the Opposition’s new foreign affairs spokeswoman, Helen Coonan got substantial press coverage in India.
This new economic giant has 15 operating nuclear power plants and seven under construction. India knows that the only way to enhance the lives of its people is via access to power. Currently an estimated 400 million Indians still have no access to electricity. Nuclear power can change that dramatically.
As you would know from my past speeches, I am not a particular fan of Tim Flannery and his opinions about climate—neither is the Parliamentary Secretary for Regional Development and Northern Australia, I presume. However, it is interesting to note that in the Australian of 5 February 2009, Flannery ‘accused Australia of taking an immoral position by exporting polluting coal to India but refusing to sell it uranium to help it establish a cleaner power-generation industry’. He continued:
Australia’s moral position of selling them coal, which is a bloody poison, but not selling uranium doesn’t make any sense.
The Greens are now the only party which is refusing to acknowledge reality. But what is new?
Going right back to the early history of mankind, each significant advancement in our civilisation has gone hand in hand with new energy sources. The initial use of fire enabled early humans firstly to live more comfortably with fire for heating and cooking and then to advance by producing bronze and then iron and other metals. There were gradual developments in our civilisations over the following centuries but the next enormous, exponential leap in the development of human society, especially in the West, was the Industrial Revolution. That advance would have been impossible without a quantum leap in the development of energy sources—specifically, using coal to make steam, which literally drove the Industrial Revolution. Thus energy became once again the literal driver of man’s incredible advances over the last couple of centuries. And now once again energy is front and centre in the deliberations of many governments.
The economic benefits to Australia of this initial step by the federal government, together with a welcome policy change in Western Australia, will also be huge. The mantra over the last few weeks has been the importance of keeping jobs in Australia to try and insulate us as much as possible from the disasters befalling the world economy. New projects, such as the expansion of current mines and the opening up of new ones will provide the very best economic stimulation possible. This means real jobs, real and significant infrastructure, real earnings from real wealth and, most importantly, creating wealth instead of borrowing it from future generations of Australians.
Finally, there is the ultimate flow-on effect from this and other similar arrangements which will surely come in the near future. Although European countries are now expressing renewed interest in nuclear power, there is one principal problem associated with this reawakening. There was flourishing nuclear science going in parallel with the development of nuclear power in the fifties and sixties. Then, with the realigning of ideology to fit in with the antiprogressive theology of extreme and almost unquestioned green politics, these nuclear programs became unpopular in some countries. Germany, the UK and others, which had once embraced the new technology, were browbeaten by the disingenuous scare tactics of the Left to start winding back their nuclear programs. They started decommissioning nuclear power stations and basically recanting on their faith in nuclear power, on which they had previously relied to provide non-fossil fuel power for the future.
France, of course, was an exception, because it had no natural energy resources of its own. Not surprisingly, France did not want to be totally beholden to other countries for gas or oil, so the preference for nuclear energy was easy. As the French said about nuclear power: no oil, no gas, no coal—no choice. Now the other countries are coming around to their previous position and looking once again to nuclear power. They realise that nuclear power can carry them over at least the next century while new energy sources are being investigated and developed. The big problem is that, while their nuclear programs were up and running, they had the expertise to run these programs. With the winding back of nuclear energy programs, there was little or no renewal of this expertise. As the nuclear industry was diminishing, the men and women who were highly trained in this area were getting old and retiring. Thus, just when they are so badly needed, where are the nuclear scientists and technologists who will be needed to back up the increased demand for this energy?
We saw in last year’s budget the very short-sighted reduction in funding for organisations such as ANSTO, reductions which I spoke strongly against on 3 June and 23 June last year and again in the most recent sitting week. With the very welcome change in the mindset of the federal Labor Party on the issue of uranium mining, here is the perfect opportunity to see the opportunities this provides down the line. Here is the opportunity to really become the ‘really clever country’. The United States realised the huge potential for computer technology, and Silicon Valley came into being. We can have our own uranium based version of Silicon Valley right here in Australia, geared to nuclear science and technology. Instead of reducing funding for nuclear technology, what a really forward-thinking government would do is seize this opportunity. Australia can become a centre of excellence for training the many scientists and technicians who will be needed in the coming decades to run the proposed new plants. This is a total win-win for Australia. We would be servicing both ends, if you like, of the nuclear process: providing the raw material with which to drive the new plants and also providing educational facilities at which the next generation of staff could be trained.
In summary, this bill could not have come at a more opportune time. One could almost say that the nuclear planets are aligning—with the realisation that nuclear power is an important part of many nations’ energy mix, with a welcome change in uranium policy within the Labor Party, with renewed interest in funding progressive programs for local Indigenous communities and with the real prospect that Australia can become a world leader in nuclear technology. The potential benefits exist not just for the Northern Territory and Indigenous Australians but for the whole country and our trading partners. We are at a crossroads with regard to energy right now. We can stick our heads in the sand and pretend we can somehow make do without nuclear energy, as the extreme so-called environmentalists do, or we can admit that energy is the key to the world’s future, stop kidding ourselves about pie-in-the-sky energy sources and get real. Let us take this once-in-a-lifetime conjunction of events and make the most of it.
Firstly, there is the signal of the growing independence of the Northern Territory. There has always been an idea that somehow the Territory is a poor relation of the other states and somehow less able to run its own affairs. This is highlighted in the issue of uranium. When the Commonwealth government granted the Northern Territory self-government in 1978 there were some areas of control kept by the federal government, one of which was the ownership of uranium. This meant that royalty arrangements were made on a case-by-case basis, making it almost impossible for there to be any coherent and accurate assessment by companies as to the viability or otherwise of potential projects in the Northern Territory. Anyone who knows anything about developments, especially on the sort of scale needed with these projects, understands that the more certainty companies have, the more likely the project is to proceed. It is also often the case that mineral deposits are not just uranium. In some cases there are other deposits as well—copper, for example. Therefore, freeing up these deposits of uranium may well enable other valuable mineral resources to be mined as well, further adding to the wealth of the region, which is even more important than ever in these times of economic gloom and doom.
Therefore, this is quite a watershed moment for the Territorians. The first consideration is: what sort of revenue are we talking about? Energy Resources of Australia, ERA, produces about 11 per cent of the world’s uranium oxide, coming entirely from the Ranger mine in the Alligator River region of the Northern Territory. It is sold only for the generation of electricity under strict international safeguards monitored by the Australian Safeguards and Non-Proliferation Office and the International Atomic Energy Agency. The Northern Territory has also given the green light for exploration on the Angela and Pamela prospects, which are said to contain more than 12,000 tonnes of uranium oxide, worth up to $2.5 billion. Of course, as world demand for uranium increases, the price is driven up. One source says that, after a three-year low of around US$40 a pound in early November 2008, the uranium price has soared to US$53 a pound only two months later. Long-term prices are expected to be around US$65 a pound.
The second important aspect of this bill is the revenue flow to local Aboriginal communities. I think it is fair to say that in the last few years there has been more scrutiny than ever of Aboriginal communities—how their people live and how royalties can be used to provide real benefits for their people. These royalties can be used to provide essentials such as better housing, good quality water and other important services such as education, health and community services. Hopefully the mistakes of the past will remain in the past and this new opportunity will be taken with both hands by local leaders and provide palpable and permanent benefits for the local Indigenous population. There are also other benefits. A recent newspaper article said that ERA employs approximately 500 full-time employees, with 18.5 per cent Indigenous employees, a figure that has nearly doubled in the past two years. The company also promotes indirect employment opportunities, facilitates skill development and supports Aboriginal business enterprises.
With the change in the WA government, local Indigenous leaders held a conference late last year. This was aimed at educating traditional owners and industry on uranium issues, the environment and native title implications. Hopefully in the near future WA Indigenous communities will start to reap the benefits which will soon be flowing to the Northern Territory people. This revenue flow and the employment and other opportunities that come with it hold great potential for Indigenous people. It should provide an encouraging and inspirational showcase of what can be achieved when people of goodwill get together and work for the benefit of all. As I said in my speech of a year ago, we need to break the cycle of dependency, vulnerability and despair pervasive in some Indigenous communities. These royalties could be the circuit-breaker, enabling the next generation of Indigenous Australians to reap the benefits of mainstream Australian society.
The third important aspect of this bill, and possibly the most significant, is the realisation by most members of the government that nuclear power is again being seen as the energy saviour of not just developed but developing countries. For far too long Labor Party policy on uranium mining has been at best contradictory and illogical and at worst detrimental to the nation’s economy. Its intellectually incongruous three-mines policy put the intelligent, pro-resource development members of the Labor Party at constant odds with ideological Luddites who are still carrying banners and mouthing slogans of the Cold War. Thankfully sanity has prevailed, due in no small part, I suspect, to several sensible senior ALP figures who realise the three-mines policy is untenable and ludicrous. Their force of argument has finally dragged most of the rest of the ALP into the 21st century
South Australian Premier Mike Rann has moved to end uncertainty over the Olympic Dam project with an expansion worth $7 billion to produce copper, gold and uranium. The Premier said the mine was valued as a ‘trillion dollar resource’. Of course, Mike Rann as ALP president pushed hard for Labor to scrap its ‘no new mines’ policy last year.
There is still the recalcitrant rump of naysayers in the WA Labor Party but thankfully we now have a Liberal-National government there, which has wasted no time fulfilling an important election promise and opened up my home state to the huge potential which uranium mining presents. Current WA ALP leader Eric Ripper had his ears well and truly pinned back by the federal Minister for Resources and Energy, who accused him of patently false and irresponsible scaremongering on the issue of uranium mining. This is the same minister who was in the Northern Territory about 30 years ago working for the union representing uranium miners.
Mr Gray —He was pro-uranium.
Dr JENSEN —Exactly. That is precisely what I was saying. This was about the same time that Midnight Oil first started haranguing Australians about the evils of uranium.
Mr Gray —They were not pro-uranium.
Dr JENSEN —Definitely not. Those personal histories must add a bit of spice to Labor cabinet meetings.
The Australian Workers Union also savaged WA Labor over its ideological opposition to uranium mining and urged it to fall into line with current federal ALP policy. Secretary Paul Howe said:
It’s not the 1980s. Labor in WA needs to demonstrate they are interested in developing the economy of the state.
This ideologically atavistic position of WA Labor is very damaging, as Paladin MD John Borshoff said:
You can’t operate in a regime where you have to ignore the policies of an elected government for fear of what a change in government would bring—that is the very definition of sovereign risk and the behaviour of a Third World country.
Then there is the implication of the energy future for many countries, especially in Europe and Asia. There has been a growing realisation in Europe and Asia that for a variety of reasons—some valid and others less so—nuclear energy is the only solution to a series of problems.
The Weekend Australian recently heralded the return of Sweden to the nuclear family. New reactors will be built there for the first time in nearly 30 years. This is despite Sweden having extensive hydro-generating capacity. According to the report, even after the four-party coalition was split three to one, the dissenting party leader still supported the move to nuclear energy:
I am doing this for the sake of my children and grandchildren.
The article noted that there is the added concern ‘about the reliability of Russian-supplied fuel after Moscow’s gas dispute with Ukraine last month’. Poland is planning on having its first nuclear plant by 2020 and Britain has decided to replace its ageing reactors and create new sites. France, which is the nation most dependent on nuclear energy—about 75 to 80 per cent of France’s energy is nuclear generated—has ordered its 61st nuclear generator. Finland is building the largest reactor in the world, a third-generation pressurised water reactor, which is expected to open in 2011.
China indicated last month that it may consider increasing nuclear generation capacity from nine gigawatts to 70 gigawatts by 2020—an enormous increase. An MIT report said China may have to add as many as 200 nuclear plants by 2050 to meet its energy needs. There is also a huge market in India, which has been a contentious issue that Australia cannot ignore. That was pointed out by Greg Sheridan nearly four months ago when he noted:
A single statement in support of uranium sales by the Opposition’s new foreign affairs spokeswoman, Helen Coonan got substantial press coverage in India.
This new economic giant has 15 operating nuclear power plants and seven under construction. India knows that the only way to enhance the lives of its people is via access to power. Currently an estimated 400 million Indians still have no access to electricity. Nuclear power can change that dramatically.
As you would know from my past speeches, I am not a particular fan of Tim Flannery and his opinions about climate—neither is the Parliamentary Secretary for Regional Development and Northern Australia, I presume. However, it is interesting to note that in the Australian of 5 February 2009, Flannery ‘accused Australia of taking an immoral position by exporting polluting coal to India but refusing to sell it uranium to help it establish a cleaner power-generation industry’. He continued:
Australia’s moral position of selling them coal, which is a bloody poison, but not selling uranium doesn’t make any sense.
The Greens are now the only party which is refusing to acknowledge reality. But what is new?
Going right back to the early history of mankind, each significant advancement in our civilisation has gone hand in hand with new energy sources. The initial use of fire enabled early humans firstly to live more comfortably with fire for heating and cooking and then to advance by producing bronze and then iron and other metals. There were gradual developments in our civilisations over the following centuries but the next enormous, exponential leap in the development of human society, especially in the West, was the Industrial Revolution. That advance would have been impossible without a quantum leap in the development of energy sources—specifically, using coal to make steam, which literally drove the Industrial Revolution. Thus energy became once again the literal driver of man’s incredible advances over the last couple of centuries. And now once again energy is front and centre in the deliberations of many governments.
The economic benefits to Australia of this initial step by the federal government, together with a welcome policy change in Western Australia, will also be huge. The mantra over the last few weeks has been the importance of keeping jobs in Australia to try and insulate us as much as possible from the disasters befalling the world economy. New projects, such as the expansion of current mines and the opening up of new ones will provide the very best economic stimulation possible. This means real jobs, real and significant infrastructure, real earnings from real wealth and, most importantly, creating wealth instead of borrowing it from future generations of Australians.
Finally, there is the ultimate flow-on effect from this and other similar arrangements which will surely come in the near future. Although European countries are now expressing renewed interest in nuclear power, there is one principal problem associated with this reawakening. There was flourishing nuclear science going in parallel with the development of nuclear power in the fifties and sixties. Then, with the realigning of ideology to fit in with the antiprogressive theology of extreme and almost unquestioned green politics, these nuclear programs became unpopular in some countries. Germany, the UK and others, which had once embraced the new technology, were browbeaten by the disingenuous scare tactics of the Left to start winding back their nuclear programs. They started decommissioning nuclear power stations and basically recanting on their faith in nuclear power, on which they had previously relied to provide non-fossil fuel power for the future.
France, of course, was an exception, because it had no natural energy resources of its own. Not surprisingly, France did not want to be totally beholden to other countries for gas or oil, so the preference for nuclear energy was easy. As the French said about nuclear power: no oil, no gas, no coal—no choice. Now the other countries are coming around to their previous position and looking once again to nuclear power. They realise that nuclear power can carry them over at least the next century while new energy sources are being investigated and developed. The big problem is that, while their nuclear programs were up and running, they had the expertise to run these programs. With the winding back of nuclear energy programs, there was little or no renewal of this expertise. As the nuclear industry was diminishing, the men and women who were highly trained in this area were getting old and retiring. Thus, just when they are so badly needed, where are the nuclear scientists and technologists who will be needed to back up the increased demand for this energy?
We saw in last year’s budget the very short-sighted reduction in funding for organisations such as ANSTO, reductions which I spoke strongly against on 3 June and 23 June last year and again in the most recent sitting week. With the very welcome change in the mindset of the federal Labor Party on the issue of uranium mining, here is the perfect opportunity to see the opportunities this provides down the line. Here is the opportunity to really become the ‘really clever country’. The United States realised the huge potential for computer technology, and Silicon Valley came into being. We can have our own uranium based version of Silicon Valley right here in Australia, geared to nuclear science and technology. Instead of reducing funding for nuclear technology, what a really forward-thinking government would do is seize this opportunity. Australia can become a centre of excellence for training the many scientists and technicians who will be needed in the coming decades to run the proposed new plants. This is a total win-win for Australia. We would be servicing both ends, if you like, of the nuclear process: providing the raw material with which to drive the new plants and also providing educational facilities at which the next generation of staff could be trained.
In summary, this bill could not have come at a more opportune time. One could almost say that the nuclear planets are aligning—with the realisation that nuclear power is an important part of many nations’ energy mix, with a welcome change in uranium policy within the Labor Party, with renewed interest in funding progressive programs for local Indigenous communities and with the real prospect that Australia can become a world leader in nuclear technology. The potential benefits exist not just for the Northern Territory and Indigenous Australians but for the whole country and our trading partners. We are at a crossroads with regard to energy right now. We can stick our heads in the sand and pretend we can somehow make do without nuclear energy, as the extreme so-called environmentalists do, or we can admit that energy is the key to the world’s future, stop kidding ourselves about pie-in-the-sky energy sources and get real. Let us take this once-in-a-lifetime conjunction of events and make the most of it.
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