Diggers & Dealers looms as likely keynote on WA uranium future

Diggers and Dealers is around the corner and the biggest event in mining will get underway in early August for three days of PowerPoint presentations, pressing issues, and perhaps a little bit of debauchery among the preeminent figures in Australian resources.

Discussions surrounding an under-siege nickel industry, capitalising on record gold prices, and the portents for lithium will have their time.

But it is the presence of a former defence minister and governor of Western Australia who cut against the nuclear grain as the keynote speaker that its likely to set an early agenda for the Diggers and Dealers Mining Forum.

West-end yellowcake

Eighteen years ago as leader of the opposition, leading Australian Labor Party figure Kim Beazley once put his leadership credentials on the line and opened up a split among the federal Labor Party by arguing that a no-new-uranium-mine stance should be promptly cut from the party’s policy.

The Western Australian was defeated the next year in a leadership spill by future prime minister Kevin Rudd, and Labor went on with Rudd at the helm to vote to abandon the policy by a slim 205-to-190 margin that remains a point of contention within the party.

Among Beazley’s most ardent opposers was his environment spokesman and a man who now holds the top post as Prime Minister of Australia, Anthony Albanese.

“I told the leader I disagreed. I said I would continue to argue for our no-new-mines policy, which has the overwhelming support of ALP members,” Albanese said at the time.

Albanese opposed the shift on grounds that nuclear waste storage and the proliferation of nuclear weapons remained unsolved problems, but the policy shift was made, power stripped from Canberra, and decisions were left to the states.

Uranium mining remains banned in Queensland, Victoria, and New South Wales, while Beazley’s home state of Western Australia grandfathered in a handful of potential mines that could go ahead with development.

Only one satisfied the conditions to proceed, and owner Deep Yellow (ASX:DYL) will be presenting later on in the first day at Diggers on hopes of production in the Sandgroper State.

But there are other hopefuls, and skyward prices will have more companies looking towards a potential policy shift and access to the West’s rich endowment of yellowcake.

The Liberal Party of WA has vowed to overturn the de facto ban, believing the states’ substantial uranium endowment offered a stimulated and diversified economy.

The stance was backed by the Minerals Council of Australia with bullish words that a restriction lacks both economic and scientific justification and stifles development of world-class reserves.

But WA Labor leader and current Premier Roger Cook has been largely dismissive of both nuclear power and uranium mining.

Cook’s assertions that uranium operations would be unprofitable until around the $130 a pound mark drew a fiery rebuke from Cauldron Energy helmsman Jonathan Fisher.

“It would be like the iron ore industry needing the absolute peak that it is ever achieved. We would be making an absolute fortune at today’s prices,” Fisher said.

Fisher wrote an open letter to Western Australians about uranium mining in an opinion piece published on MarketOpen last December that went viral, arguing current government policy should reflect the view of the majority.

Others to watch

Chalice Mining 

Once embodying the junior dream of making a truly world-class discovery and ascending to the majors, Chalice Mining (ASX:CHN) and has since run the gauntlet taking Gonneville to development.

Chalice has gone through more than a descending nickel price but has continued to advance and significantly expand the world class nickel-copper-platinum group deposit and intersect several new high-grade zones.

Sufficient resource confidence has past the inflection point for completion of feasibility studies, and Chalice will be looking to prove a point in Kalgoorlie and find a major partner to take Gonneville to production.

Lynas Rare Earths 

Gina Rinehart has bought in with a 5.82 per cent Lynas Rare Earths (ASX:LYC) stake and the US Department of Defence is invested too with a follow-on contract for construction of a heavy rare earth component of a processing facility in Texas.

Feedstock for Lynas’ Texas facility is set to be sourced from Western Australia, and less established explorers will no doubt be interested in the prospects surrounding their own assets and a geopolitical state of play for rare earths.

Delta Lithium 

Delta Lithium (ASX:DLI) has quietly assumed provincial control over the Gascoyne’s lithium territory after striking farm-in deals with neighbouring Voltaic Strategic Resources (ASX:VSR) and Reach Resources (ASX:RR1).

Viewed through record lithium prices as one of the few cost-effective exploration areas remaining, Delta was a first mover into the Gascoyne and continued to up its stake through the downturn.

But current processing options are further afield than others, and it will be interesting to see how Delta plans to capitalise on its landholdings and push its share price higher than the current mark.

Northern Star Resources 

Heavy rainfall put a dent in Northern Star Resources‘ (ASX:NST) profits and left it tracking behind third quarter guidance.

One of the world’s biggest gold producers, the company will be making its case for a big fourth quarter and a 2024 guidance that remains well on track.

A rise in the all-in sustaining cost could get put down to the weather, but pressures are sector-wide and would-be producers and acquisition targets will want to hear from one of the biggest on its AISC costs outlook and the massive cash-generating potential of Aussie ounces.

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