PERTH, Australia - China wants to establish a pricing formula for
Australian uranium that will ensure a stable supply of the nuclear
fuel, Premier Wen Jiabao said Sunday at the start of a four-day Australian
tour.
Chinese Premier Wen
Jiabao watches a formation of stable natural gas hydrate burn during an
experiment at the Woodside Hydrocarbon Research Facility at Curtin
University of Technology in Perth, Australia April 2, 2006.
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Wen was
speaking in the west coast city of Perth on the eve of a meeting with Prime
Minister John Howard on Monday in the national capital, Canberra. The leaders
are expected to announce an agreement that will enable China to import uranium
for power generation but prohibit military use or resale to a third country.
China has been negotiating for months to buy uranium from Australia, which
has 40 percent of the world's known uranium deposits.
Howard on Sunday said he was confident that China would agree to the strict
safeguards in the contract, including compliance in facility inspections.
But even after the deal is signed, uranium exports to China are not expected
to start anytime soon, Australian Resources Minister Ian Macfarlane said, citing
logistic and other obstacles.
Wen's call for a price formula comes amid record high prices for uranium and
China's continued unease about soaring commodity markets, particularly pressure
on iron ore prices.
China wants a "stable relationship between supply and demand" for uranium,
Wen said, responding to a briefing by Macfarlane on the country's overall mining
and energy sector.
"We are also going to set up a price formation mechanism that is up to
international laws," he added.
But Macfarlane said there have been "no discussions" on pricing as part of
the uranium agreement.
He also said he is confident that China won't attempt to "cap" prices of
uranium, a reference to recent speculation of price capping efforts by Chinese
iron ore importers.