ERA Energy Resources Of Australia Limited

Australia on Friday delivered an upbeat outlook for its uranium export industry, shrugging off concerns that an ongoing nuclear crisis in Japan will sap demand for the fuel.

Australia's uranium production is expected to double in the next four years and quadruple within 20 years, Resources and Energy Minister Martin Ferguson said.

Production in recent years has been hampered by wet weather at the Ranger mine in Australia's Northern Territory and a shaft failure at Olympic Dam in South Australia state, which has since been repaired.

"We are already the world's third-largest uranium producer, with nearly half of the world's low-cost uranium reserves, and further opportunities on the horizon," Ferguson told an industry gathering.

His comments show that key policymakers still see a future for atomic power despite a severe earthquake and tsunami in March crippling a Japanese nuclear facility and prompting nations including China, India, Germany and Switzerland to review new nuclear builds.

"Nuclear is an important part of the energy mix for many countries," Ferguson said. "It is a cleaner energy option and powers millions of homes and businesses around the world."

Despite its vast resources, Australia is losing ground as a producer of uranium to emerging economies such as Kazakhstan, Namibia and Niger. In 2009, Australia produced 7,156 metric tons of uranium oxide -- just 13% of the global total.

Ranger produced 9% of the world's uranium in 2009 but it is scheduled to close its main pit next year, while Jabiluka, a vast resource close to Ranger, may never be developed due to Aboriginal land-rights concerns.

Offsetting these projected declines, Ferguson said Uranium One Inc.'s (UUU.T) Honeymoon uranium mine in South Australia is expected to start in the "next few months".

BHP Billiton Ltd. (BHP) is currently considering an expansion of Olympic Dam, which Ferguson said could boost its uranium output eight-fold.

The diversified mining giant said Friday that it has moved closer to approving the expansion after gaining government approval to release to the public updated plans to meet environmental, social and economic concerns.

The company is working on a feasibility study and Chief Executive Marius Kloppers in February said an investment decision on whether to proceed was expected within 12 months.

Australia's Greens party, a key power broker in parliament, discourages the export of Australian uranium offshore.

"Nuclear power should be phased out before it phases itself out. The industry is in fairly serious trouble globally," Greens Senator Scott Ludlam told Dow Jones Newswires.

The Greens are already key to propping up Prime Minister Julia Gillard's minority government in the lower house. From July, the environmentalist party will hold the balance of power in the upper house further bolstering its negotiating hand.

Ludlum, however, said that the Greens can't find a large enough number of fellow lawmakers to propose a complete ban on new uranium mines. "I could do that this afternoon but I don't have the numbers on it," Ludlum said.

The Greens will "keep the blow torch" on improving safety rules imposed on uranium miners, he said.

-By Ross Kelly, Dow Jones Newswires; 61-2-8272-4692; Ross.Kelly@dowjones.com

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