SYDNEY (AFP) — The world's biggest mining company BHP Billiton said Wednesday it intended to supply uranium to China for decades to come as the Asian superpower ramps up its nuclear energy programme.
The chief executive of the Anglo-Australian miner, Marius Kloppers, said BHP Billiton was "very actively positioning" to take advantage of China's move towards greater use of nuclear energy.
"As China is developing its nuclear programme, what it's doing is it's gearing up for a bigger build programme," Kloppers said in a video address sent to shareholders.
"That will take a couple of years, but clearly we are positioning the company to, from our side, participate in that over decades, not just a couple of years."
BHP Billiton, whose Olympic Dam in South Australia holds the world's largest known uranium reserves, said nuclear energy could help cut back on carbon emissions, which are generated from the burning of fossil fuels such as coal.
"If the world is serious about cutting carbon emissions, then you cannot have a debate without the nuclear piece in that debate, because it is the most efficient way to cut carbon emissions," company chairman Don Argus said.
Australia and China last year ratified a nuclear agreement clearing the way for the export of uranium to feed Beijing's giant nuclear power programme.
While BHP Billiton does not yet have any supply contracts with China, it exports uranium to the United Kingdom, France, Sweden, Finland, Belgium, Japan, South Korea, Taiwan, Canada and the United States.
BHP Billiton announced Wednesday in its annual report to shareholders a 22.6 percent upgrade in the uranium reserves at its Olympic Dam mine to 283,800 tonnes. The mine produced some 4,144 tonnes of uranium last financial year.
The company would also expand its uranium resources if it is successful in its hostile takeover bid for rival miner Rio Tinto, which has a uranium mine in Namibia and holds a stake in another in Australia's Northern Territory.
Rio Tinto has rejected BHP's 3.4-for-one share offer, saying it significantly undervalues the company.
Argus again rejected the Rio Tinto stance.
"We think we've created the value bid now, and it's a relative value bid that's on the table, or it's a conditional relative value bid, and I probably could run a different argument with petroleum running pretty strongly at the moment, that probably it's overpriced," he said.
BHP Billiton, which this year reported a record profit of 15.4 billion US dollars, produces iron ore, coal, oil and gas -- products much in demand in developing Asian nations.
Argus said while he expected Asian economic growth to slow at some point, demand for raw materials from countries such as China was expected to continue.
"We expect Asian demand for our products to continue," he said.
In the company's annual report, Argus said BHP Billiton was watching the rise of Asia and the lessening influence of Europe and the relative shrinkage of the US economy and this provided the context for the Rio bid.
If the two firms merged they could "help meet the developing economies' demand for resources better and faster than the two companies do apart," he said.
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