Australia’s $211 billion nuclear plan to change uranium mining

If successful, the plan would transform Australia, which is grappling with rising energy demands and the need for more reliable and affordable electricity, into a nuclear-powered nation.

Dutton, leader of the centre-right Liberal Party, has positioned nuclear power as the cornerstone of Australia’s economic future, calling it essential for decarbonizing the grid, lowering energy costs, and ensuring a stable electricity supply.

“Nuclear power will underpin the economic success of our country for the next century,” Dutton said, according to Bloomberg. “This will make electricity reliable. It will make it more consistent. It will make it cheaper for Australians, and it will help us decarbonize.”

Leaders divided

The plan is already sparking fierce debate, as its success would not only transform Australia’s energy landscape but also change its uranium mining industry, which has long been restricted despite the nation’s vast reserves.

Australia is currently the world’s fourth-largest uranium producer and holds an estimated one-third of the planet’s known reserves. Yet, uranium mining remains banned in Western Australia and Queensland, two states with major deposits.

While South Australia is home to three operational uranium mines — including the Olympic Dam, which is the largest known uranium deposit in the world — mining activity remains limited. The other active sites, Four Mile and Ranger, have smaller footprints, with Ranger nearing the end of its lifecycle. This underutilization contrasts sharply with growing global demand for uranium as countries seek cleaner alternatives to fossil fuels.

Critics also argue that while Australia’s parliamentary Coalition, consisting of the Liberal Party and the Nationals, is dedicated to achieving net zero emissions by 2050, Dutton’s preferred approach would likely result in increased emissions leading up to that year. 

Climate Change and Energy Minister Chris Bowen warned that the situation would likely jeopardize Australia’s ability to meet the global goal of limiting climate change to two degrees Celsius. He pointed out that the modelling assumes electricity demand will rise less than the government anticipates, despite the expanding use of energy-intensive artificial intelligence and the surging popularity of electric vehicles. 

Bowen described the plan as “a dangerous error,” cautioning that it could leave Australians without sufficient energy to meet their needs.

Advocates of Dutton’s nuclear plan believe that lifting mining restrictions is a logical next step to ensure a steady domestic uranium supply. Doing so could unlock billions of dollars in economic opportunities, attract foreign investment, and create thousands of jobs. Western Australia, for instance, could see dormant projects revived. 

Canadian uranium giant Cameco (TSX: CCO)(NYSE:CCJ) owns the Yeelirrie project in the state. It acquired it from BHP (ASX: BHP) in 2012, but development has stalled due to the mining ban. Companies like Toro Energy (ASX: TOE) and Paladin Energy (ASX: PDN) are also poised to expand operations if restrictions are lifted.

The Minerals Council of Australia, a strong proponent of lifting mining bans, has long argued that Australia is well-positioned to meet global clean energy demand. It notes that countries worldwide are ramping up nuclear energy adoption, creating an unprecedented demand for uranium. Allowing more mining activity would enable Australia to play a larger role in the international market, challenging current leaders like Kazakhstan, Canada, and Namibia.

Exploration boom

The stakes for uranium mining in Australia are particularly high, given the nation’s geopolitical stability and abundant resources. If mining restrictions are lifted in Western Australia and Queensland, industry experts predict a surge in exploration and development. This could transform regions that are currently untapped for uranium into mining hubs, driving economic growth and strengthening Australia’s role as a global energy leader.

Dutton’s nuclear vision is far from universally embraced. The plan faces significant political and environmental hurdles. Prime Minister Anthony Albanese’s centre-left Labour government has shown no interest in nuclear power, focusing instead on expanding renewable energy sources like wind and solar. 

Critics argue that nuclear energy’s high upfront costs and challenges with radioactive waste management outweigh its potential benefits. 

Environmental groups have also opposed uranium mining for decades, citing concerns about ecological damage and contamination risks.

If Dutton’s proposal moves forward, it would also place significant pressure on Australia’s regulatory framework for uranium mining. The potential expansion of mining activity would require updated environmental guidelines, new infrastructure, and investments in workforce training.