Reliance Industries Ltd Chairman and Managing Director Mukesh Ambani is strengthening his hold on the mineral of the future, uranium, in the Australian region which has the bulk of uranium reserves in the world.
The joint venture between RIL Australia, a Reliance Industries Ltd arm, and Uranium Exploration Australia is in full swing with eight mines under its belt. And while the exploration will have a long gestation period the project cost will be massive.
“It would probably be 10 years before any successful discovery comes through in terms of uranium production and I would say that our target in terms of size for a new discovery be certainly a mine which is capable of producing more than 1000 tonnes of uranium a year,” said Russell Penney, MD, UXA.
Reliance and UXA also have the option of taking the JV forward in other mining projects in future but will all the uranium produced be sold off in the market or do they plan to enter the nuclear energy space?
“Their investment in UXA and Uranium Exploration in Australia is not predicated necessarily on importing Uranium into India or developing nuclear industry in India. Getting into the highly specialised and capital intensive business of building nuclear power station and producing electricity is really a sort of a growth target that is quite a long way away,” Penney said.
As India grows in the nuclear power space after the 123 agreement signed with the US, a huge market will be opened up for uranium.But due to the political stalemate between India and Australia on uranium trade, the business may stand to suffer unless diplomacy manages to make a difference.