PERTH (miningweekly.com) – Strong global demand for coal and uranium would boost the Australian economy over the next two decades, says the Australian Bureau for Agricultural and Resource Economics (Abare).
In a report on behalf of the Department of Resources, Energy and Tourism, Abare found that world primary energy demand is projected to increase by 40% between 2007 and 2030, representing an average annual growth rate of 1,5%, in the International Energy Agency (IEA) 2009 World Energy Outlook reference scenario.
More than three-quarters of the increase in primary energy demand will continue to be for fossil fuels.
Abare noted that of the fossil fuels, coal is expected to be the fastest growing fuel and is projected to account for 29% of world primary energy demand in 2030, followed by gas, which is projected to maintain its current share of 21%.
Global demand for coal is expected to grow by an average of 1,9% a year between 2007 and 2030. The majority of this increase in world coal demand is expected to come from China and India.
China is also projected to account for nearly two-thirds of the increase in global coal production over the period, while the US, India and Australia are expected to remain the next largest coal producers.
Abare noted that while Australia is the fourth largest producer, the largest exporter, it also has the fourth largest reserves of coal in the world. The country was also well-placed to take advantage of increasing global demand for coal because of its large low-cost, high quality reserves.
At end of 2009, there were over 100 operating coal-mines and more than 35 proposed new mines and expansions at various stages of development ranging from scoping studies to construction
Australia exported around 252-million tons of black coal in 2007/08, of which around 54% was metallurgical coal and 46% was thermal coal. Exports were valued at A$24,4-billion.
Abare noted that the country’s coal production is projected to increase at an average annual rate of 1,8% in 2029/30. Exports would also be increased at a projected rate of 2,4% a year to 2029/30.
URANIUM
From 2007 to 2030, the share of nuclear power in primary energy demand is projected to remain steady at 6%, with demand to increase by 1,3% a year over this period.
Most of the projected growth in nuclear power is expected to be in China, with most of the remaining growth occurring in other Asian countries. Nuclear power capacity in Europe, however, is projected to decline over the outlook period.
Abare noted that Australia was expected to remain a key provider of uranium exports to the growing Asian markets, as the country hosted more than one-third of the world’s known economic uranium resources.
Australia also has the world’s largest uranium resources with reasonably assured resources of uranium recoverable at less than $80/kg, estimated to be 651 280 petajoule (PJ) or 1,1-million tons, equivalent to about 140 years at 2008 production levels.
High levels of exploration are expected to add to the resource base. Australia is one the world’s leading exporters of uranium and has a number of proposed new mines to meet increasing world demand, Abare noted. The country also has a major share of the world’s thorium resources, a potential future nuclear fuel.
In the medium to long-term, Australia’s production of uranium is expected to increase significantly, reflecting the country’s large low cost uranium resources, proposed new mines and increasing export demand.
Australia’s uranium production is projected to more than double from 4 872 PJ, or 8 700 t in 2008/09 to 11 760 PJ or 21 000 t by 2029/30.
As there were currently no plans for Australia to have a commercial nuclear power industry or enrichment facilities; all of Australia’s uranium production will continue to be exported.
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