From: Reuters
Published March 11, 2008 07:45 AM

Rio Tinto aims to double uranium output

LONDON (Reuters) - World number two miner Rio Tinto <RIO.L> <RIO.AX> intends to double uranium production over the next five years as demand for alternatives to fossil fuels grows, a senior company executive said on Tuesday.

"Our aim is to double production over the next five years or so," said Preston Chiaro, Chief Executive of the firm's Energy and Minerals division.

Rio mines uranium, which fuels nuclear power plants, at Rossing in Namibia and at the Ranger mine in Australia.

Ranger is operated by Energy Resources of Australia (ERA) <ERA.AX>, of which Rio owns 68 percent.

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Chiaro put current output at around 4,000 tonnes per year at Rossing and 5,000 tonnes at ERA, and the firm hopes to raise production by digging more uranium at or near its existing mines.

"There is a lot of work going on in the vicinity of Rossing and ERA," Chiaro said, adding that the firm was also looking at other sites in Africa, Asia and Australia.

The firm would make an announcement in June or July about how much the ERA expansion will cost, and in September about Rossing, Chiaro said.

Uranium prices have risen tenfold since the start of the decade as global energy needs have boomed, and as power consumers and producers seek alternatives to pollutants such as coal and oil.

"Every energy source has its downside," Chiaro said. "With nuclear, it's waste disposal or concerns about terrorism.

"With waste disposal, because of the length of time involved, it's going to have to be a solution that involves governments," he said.

(Reporting by Daniel Magnowski; editing by Chris Johnson)

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