A report by the not-for-profit group Corporate Watch Australia claims that “many so-called ethical funds are not necessarily ethical in the area of uranium mining”.
“Of the 18 ethical investment funds studied, just four have policies that absolutely screen out investment in uranium and nuclear power, five have no policy, seven have policies that allow for some level of investment and one is proudly pro-nuclear,” Corporate Watch says. The companies offering funds that screen out uranium are Australian Ethical, CVC Sustainable Investments, Hunter Hall Investment Management and Perpetual Investments.
The report was commissioned by environmental group Friends of the Earth, which has been campaigning against uranium mining and nuclear power for 35 years. “We consider investment in the nuclear power chain to be unethical because of the industry’s disproportionate, adverse impacts on indigenous people; the repeatedly demonstrated connection between the ‘peaceful’ nuclear chain and nuclear weapons; the legacy of high-level nuclear waste and the existence of a plethora of more benign energy production and energy-saving methods to reduce greenhouse emissions,” Friends of the Earth says.
Corporate Watch’s findings are consistent with our September 2007 article, which found that despite uranium’s controversies most ‘ethical’ and ‘sustainable’ funds invest in big uranium mining companies such as BHP and Rio Tinto. Funds justify this on the basis that the uranium is used for nuclear energy, not weapons, or that the companies chosen get less than 5% or 10% of their (enormous) overall revenue from uranium, or that they have good environmental, social or corporate governance performance.
‘Sustainable’ and ethical’ funds that invest in uranium often permit investments in industries like tobacco and gambling too. Interpretations of what’s sustainable or ethical differ; the catch-all term ‘responsible’ is now favoured by the industry’s representative body. The industry seems to view the negative screening approach to ethical investing (where problem industries are excluded from funds) as outdated and less relevant than the more mainstream ‘responsible’ and ‘sustainability’ investing, which researches and invests in companies that perform well on environmental, social, ethical and corporate governance measures. But Corporate Watch calls this a crisis of definition. It quotes the company Australian Ethical as saying “a lot of companies claiming to invest ‘sustainably’ are actually talking about financial, rather than social or ecological sustainability”.
For information about where a range of sustainable and ethical funds invest, where to find their all-important investment methodologies, as well as their investment performance, go to our ethical investing report and the Responsible Investment Association website.
Radioactive alert on ethical investment
2 September 2008, Frances Howe, The Age (business section) One man’s ethical is another’s poison; but the adage does not apply to uranium, writes Frances Howe.
A RECENT Corporate Watch Australia survey reveals that many so-called ethical investment funds invest inuranium mining.
Some fund managers justify investment in uranium with questionable arguments about nuclear power and climate change, but the primary reason for the shift is probably BHP Billiton’s entry into the uranium industry with its 2005 acquisition of WMC Resources, which owns the Olympic Dam uranium mine in South Australia.
Of 16 ethical investment funds studied, just two allow absolutely no investment in uranium or nuclear power.
The rest either have no policy on the matter or allow limited investment in the nuclear industry – for example by allowing investment only in companies that get below a certain percentage of their income from uranium, or ruling out uranium mining but having no policy on other parts of the nuclear cycle.
Ethical investment is booming: from its origins in 1984 with a fund nicknamed “Brazil”, because you’d have to be nuts to invest in it, the sector is now worth $2 trillion worldwide. According to the Responsible Investment Association of Australasia, Australian responsible investment portfolios grew from $4.5 billion to $17.1 billion from 2004 to 2007.
However, this rapid growth is accompanied by a crisis of definition and a dilution of its original principles. The concept “ethical investment” is vaguely defined: fund managers make their own rules, and their definitions of “ethical” vary.
The sector is now more commonly called “Sustainable and Responsible Investment”. In Australia it is represented by the Responsible Investment Association of Australasia, which manages the national certification program for investment providers.
Certified companies can display RIAA’s “Responsible Investment” logo. However, there is nothing to stop any fund calling itself ethical without going through the certification process, and funds frequently do.
Many ethical investment funds use an approach known as “best of sector”. This means they do not rule out investing in any legal industry, but instead seek investment in companies that claim to be trying to improve their ethical practices. A sector cannot be ruled out on the grounds that it is simply wrong – if a company within that sector can show it is making some gesture, however tokenistic, to improve its practices, it can be included in an ethical portfolio.
Some fund managers rule out investment in companies that get more than 5% of their revenue from uraniummining or nuclear power. This means that AMP’s ethical portfolio can still include shares in BHP Billiton and Rio Tinto – the world’s fifth and third largest uranium miners respectively.
Several fund managers that invest in nuclear power cite climate change as a reason. However, little effort is made to justify the claims or to refute counter-arguments.
There is no attempt to refute the large and growing body of scientific literature that demonstrates how the expansion of renewable energy sources, coupled with concerted energy-efficiency programs, can generate major reductions in greenhouse emissions without recourse to nuclear power.
Nor have most fund managers dealt with the ethical problems associated with uranium mining and nuclear power. The uranium mining industry has a poor track record in its dealings with Aboriginal communities – failing to consult traditional owners, using divide-and-rule tactics, and ignoring sacred sites.
In the words of Yvonne Margarula, Mirarr senior traditional owner in the Northern Territory: “Uranium mining has taken our country away from us and destroyed it. Mining and the millions of dollars in royalties have not improved our quality of life.”
Similar patterns of “radioactive racism” are evident in the management of byproducts of the nuclear cycle. North American activist Winona LaDuke told the Indigenous World Uranium Summit in 2006: “The greatest minds in the nuclear establishment have been searching for an answer to the radioactive waste problem for 50 years, and they’ve finally got one: haul it down a dirt road and dump it on an Indian reservation.”
Another ethical quandary concerns the connection between nuclear power and nuclear weapons. No fewer than five of the 10 states to have produced nuclear weapons did so on the back of their “peaceful” nuclear programs. Former US vice-president Al Gore neatly summarised the problem in 2006: “For eight years in the White House, every weapons-proliferation problem we dealt with was connected to a civilian reactor program.
And if we ever got to the point where we wanted to use nuclear reactors to back out a lot of coal … then we’d have to put them in so many places we’d run that proliferation risk right off the reasonability scale.”
While ethical questions are necessarily arguable, the nuclear industry has been repeatedly and comprehensively discredited. If the ethical investment market is to retain its credibility, it must employ more rigorous and more consistent ethical screens. Further, there is a clear case for regulatory reform to ensure more transparent disclosure of investment in controversial sectors such as uranium mining and nuclear power.
Frances Howe is a researcher with Corporate Watch Australia, which monitors the social and environmental impacts of Australian corporations operating here and abroad, as well as international corporations operating in Australia.
A longer version of the above article is posted on the Online Opinion website:
Proponents of uranium mining and nuclear power argue that nuclear power is a necessary strategy in the battle against climate change. However, nuclear power could make only a modest dent in greenhouse emissions, it poses serious risks including WMD proliferation, and the existence of a plethora of more benign climate change abatement options obviates any need for nuclear power and does away with the false choice of fossil fuels vs. nuclear power.
Nuclear power could make only a modest dent in greenhouse emissions. A significant constraint is that, other than its military applications, nuclear power is used almost exclusively for electricity generation which accounts for 16-30% of global greenhouse emissions.
Globally, doubling nuclear power by 2050 at the expense of coal would reduce greenhouse emissions by no more than 5%. The 800-900 reactors required to achieve a doubling of nuclear output by 2050 would produce over one million tonnes of high-level nuclear waste, and enough plutonium to build over one million nuclear weapons.
The greenhouse benefits of nuclear power must be weighed against the costs and risks including nuclear weapons proliferation, the widespread and ongoing problem of ‘radioactive racism’, nuclear smuggling, the potential use of a wide variety of radioactive materials in ‘dirty bombs’, the potential targeting of nuclear plants by terrorists, the targeting of nuclear plants in national conflicts and wars (as has occurred on several occasions in the Middle East), the small risk of catastrophic accidents, the intractable problem of nuclear waste management, and the contamination and depletion of water resources.
The first two of those problems are briefly discussed here.
Weapons of Mass Destruction
Nuclear power is the only energy source with a direct – and repeatedly-demonstrated – link to the production of Weapons of Mass Destruction. In five cases, nation states have succeeded in producing nuclear weapons under cover of an ostensibly peaceful nuclear program – India, Pakistan, Israel, South Africa and North Korea. Many other countries (over 20 in total) have pursued nuclear weapons research under cover of a civil nuclear program.
Former US Vice President Al Gore said in May 2006 that: “For eight years in the White House, every weapons-proliferation problem we dealt with was connected to a civilian reactor program. And if we ever got to the point where we wanted to use nuclear reactors to back out a lot of coal … then we’d have to put them in so many places we’d run that proliferation risk right off the reasonability scale.”
The International Atomic Energy Agency’s (IAEA) safeguards system is flawed and under-resourced and provides little confidence that the proliferation risks associated with civil nuclear programs can be adequately contained. The Director General of the International Atomic Energy Agency, Dr. Mohamed El Baradei, has noted that the IAEA’s basic rights of inspection are “fairly limited”, that the safeguards system suffers from “vulnerabilities” and “clearly needs reinforcement”, that efforts to improve the system have been “half-hearted”, and that the safeguards system operates on a “shoestring budget … comparable to that of a local police department “.
Impacts on Aboriginal communities
The uranium mining industry has a poor track record in its dealings with Aboriginal communities. Racism in the uranium mining industry in Australia typically involves: ignoring the concerns of Traditional Owners insofar as the legal and political circumstances permit; divide-and-rule tactics; bribery; humbugging Traditional Owners (exerting persistent, unwanted pressure until the mining company gets what it wants); providing Traditional Owners with false or misleading information; and threats, most commonly legal threats.
Mining company Energy Resources of Australia (ERA) and the Howard government were determined to override the opposition of the Mirarr Traditional Owners to the Jabiluka uranium mine in the Northern Territory. ERA and the government were defeated by a remarkable national and international campaign led by the Mirarr. The Jabiluka mine site has been rehabilitated and the Mirarr have a veto over any future development of the mine, but ERA still hopes to mine Jabiluka at some stage in the future and it still operates the Ranger uranium mine near Jabiluka.
Heathgate Resources, owned by General Atomics, succeeded in imposing the Beverley uranium mine on the Adnyamathanha people in north-east SA in the late 1990s. The company negotiated with a small number of Native Title claimants, but did not recognise the will of the community as a whole. This strategy, coupled with the joint might of industry and government, has resulted in inadequate and selective consultation with the Adnyamathanha people.
The racism associated with the Roxby Downs uranium mine in South Australia is enshrined in legislation. WMC Resources was granted completely unjustifiable legal privileges under the SA Roxby Indenture Act. This legislation overrides the Aboriginal Heritage Protection Act, the Environment Protection Act, the Water Resources Act and the Freedom of Information Act. The current mine owner, BHP Billiton, refuses to relinquish the legal privileges.
Ethical solutions to climate change
Nuclear power generates fewer greenhouse emissions than fossil fuels per unit of energy output. However, nuclear power is more greenhouse intensive than most renewable energy sources. For example, the 2006 Switkowski report states that nuclear power is three times more greenhouse intensive that wind power per unit of electrical output.
There is tremendous scope to use a wide range of renewable energy sources and energy efficiency measures to reduce greenhouse emissions. For example, the Australian Ministerial Council on Energy has identified methods to energy consumption and greenhouse emissions in the manufacturing, commercial and residential sectors by 20-30% with the adoption of commercially-available technologies with an average pay-back time of four years.
For comparison, the Switkowski report estimates that the construction of 25 nuclear power reactors in Australia by 2050 would reduce emissions by 17% compared to business-as-usual, assuming that nuclear power displaces black coal. Twenty-five reactors would produce 45,000 tonnes of high-level nuclear waste and enough plutonium to build 45,000 nuclear weapons.
A significant and growing body of scientific literature details how the systematic deployment of renewable energy sources, coupled with energy efficiency policies and technologies, can generate major reductions in greenhouse emissions – without recourse to nuclear power. Moreover, a number of renewable energy sources can supply reliable base-load power including geothermal, hydro, bioenergy and solar with storage.
Sorry, We’re Sending Your Money To The Arms Dealers
This week over a million Australians lost the choice to prevent their super being invested in things like cluster bombs and cigarettes, writes Nicholas Taylor
Australia’s largest superannuation fund, which invests more than $30 billion on behalf of 1.4 million working Australians, has this week quietly removed its ethical exclusion policy.
Simply put, the door is now open for Australian Super to invest in “vice”.
Previously excluded from the fund’s “sustainable” options were companies deriving more than 5 per cent of their revenues from the “manufacture or sale of alcohol or tobacco, the operation of gaming facilities or the manufacture of gambling equipment, uranium extraction or the manufacture of weapons or armaments”.
The conservative Howard government made nuclear power illegal in Australia in the late 1990s (EPBC and ARPANS Acts) and those prohibitions remain as of mid-2018.
No power reactors have ever been built in Australia. The strongest push was for a power reactor at Jervis Bay in the late 1960s to early 1970s. That push was underpinned by a hidden weapons agenda as then Prime Minister John Gorton later acknowledged.
As of mid-2018, nuclear power is off the mainstream political agenda in Australia. There is a push to build nuclear power plants (and repeal the legal prohibitions) driven by the far-right (e.g. Senator Cory Bernadi, the Minerals Council of Australia) and a few nuclear lobbyists (such as Ben Heard – whose fake environment group accepts secret corporate donations).
In 2019, some dopey politicians are claiming that nuclear power is cheap. Here is a link to a June 2019 FoE briefing paper on nuclear power’s global economic crisis, including a letter sent to all federal MPs and Senators.
Some reasons to say ‘no’ to nuclear power in Australia
UNNECESSARY
We don’t need nuclear power. Several renewable energy sources – such as bioenergy, geothermal hot rocks, solar thermal electricity with storage, and sometimes hydroelecticity – can provide reliable baseload electricity.
More information: https://nuclear.foe.org.au/links-to-literature-on-clean-energy-options/
NUCLEAR WEAPONS
Nuclear power is the one and only energy source with a direct and repeatedly-demonstrated connection to the proliferation of Weapons of Mass Destruction. For example, the first and only serious push for nuclear power in Australia was driven by a weapons agenda as then PM John Gorton later acknowledged.
More information: www.nuclear.foe.org.au/power-weapons
ACCIDENTS AND ATTACKS
In addition to the risk of accidents, nuclear power reactors are vulnerable to disasters from sabotage, terrorism, or the use of conventional forces to attack nuclear facilities during war.
More information: www.nuclear.foe.org.au/power
ROUTINE EMISSIONS − RADIATION & CANCER
The United Nations Scientific Committee on the Effects of Atomic Radiation notes that international cancer incidence and mortality data demonstrate statistically-significant links between radiation and all solid tumours as a group, as well as for cancers of the stomach, colon, liver, lung, breast, ovary, bladder, thyroid, and for non-melanoma skin cancers and most types of leukaemia.
More information: https://nuclear.foe.org.au/radiation/
NUCLEAR WASTE
The 2006 government-commissioned Switkowski report envisaged the construction of 25 power reactors, which would produce up to 45,000 tonnes of high-level nuclear waste. There is not a single permanent repository for spent fuel or high-level nuclear waste anywhere in the world.
Democratic rights have often been trampled in the pursuit of nuclear projects. The Howard government sought legal advice on its powers to override state laws banning nuclear power plants. The current (2012) Labor government is working to impose a nuclear waste dump at Muckaty in the NT despite the opposition of many Traditional Owners, an unresolved Federal Court challenge, and NT legislation banning the imposition of nuclear dumps. The government also plans to give itself the power to override any and all state/territorry laws, and affected local councils and communities have no say.
COST
Too cheap to meter, or too expensive to matter? The nuclear power industry survives only because of huge taxpayer subsidies.
More information: EnergyScience Briefing Paper #1: http://www.energyscience.org.au/factsheets.html
REDUCED PROPERTY PRICES. COMPULSORY LAND ACQUISITION. NO INSURANCE.
A nuclear power plant would reduce local property values. The government may use compulsory land acquisition powers to seize land for reactors – just as it has previously seized land for a nuclear waste dump. Insurance companies do not insure against the risk of nuclear accidents.
WATER
Nuclear power is the most water-intensive of all the energy sources. Reactors typically consume 35-65 million litres of water per day.
More information: https://nuclear.foe.org.au/water-consumption-and-pollution-uranium-and-nuclear-power/
TOO SLOW
It would take 15 years or more to develop nuclear power in Australia. Clean energy solutions can be deployed immediately.
GREENHOUSE GASES
Nuclear power emits three times more greenhouse gases than wind power according to the 2006 Switkowski report. Nuclear power is also far more greenhouse intensive than energy efficiency measures.
More information: https://www.wiseinternational.org/nuclear-monitor/806/nuclear-power-no-solution-climate-change
Even Ziggy Switkowski has given up on nuclear power!!
‘Australia has ‘missed the boat’ on nuclear power’, Cole Latimer, 11 Jan 2018, The Age, www.theage.com.au/business/the-economy/australia-has-missed-the-boat-on-nuclear-power-20180111-p4yyeg.html
The Minerals Council of Australia has called for the country’s prohibition on nuclear power to be lifted. But both critics and supporters see little future for large-scale nuclear power in Australia’s energy mix.
The man who once famously called for 50 nuclear reactors across Australia, nuclear physicist and NBN chairman Ziggy Switkowski, says “the window for gigawatt-scale nuclear has closed”.
A lack of public support and any actual proposals for a nuclear plant had resulted in government inertia, he said on Thursday.
“Government won’t move until a real business case is presented and none has been, to my knowledge, and there aren’t votes in trying to lead the debate,” he said, adding that renewables were now a more economically viable choice.
“With requirements for baseload capacity reducing, adding nuclear capacity one gigawatt at a time is hard to justify, especially as costs are now very high (in the range of $5 billion to $10 billion), development timelines are 15+ years, and solar with battery storage are winning the race.”
Warwick Grigor, the former chairman of Uranium King, mining analyst, and a director of uranium miner Peninsula Energy, agrees.
“I think nuclear energy is great, but we’ve missed the boat in Australia, no one is going down that path in the foreseeable future,” Mr Grigor told Fairfax Media.
“When Fukushima [the 2011 nuclear accident in Japan] occurred, that was the closing of the door to our nuclear power possibilities.”
Mr Grigor sees battery technology, a market he has since entered, as a better alternative.
Australian Conservation Foundation nuclear free campaigner Dave Sweeney said talk of nuclear power was “a dangerous distraction” from the steps that needed to address the energy and climate challenges facing Australia.
Nuclear energy has been officially banned in Australia since 1998, with the Australian Nuclear Science and Technology Organisation’s OPAL reactor at Lucas Heights, NSW, the only nuclear reactor in the country.
But the Minerals Council’s executive director for uranium, Daniel Zavattiero, said the nation had excluded a low-emissions energy source of which Australia has an abundant supply from the current debate.
“Maybe nuclear power might be something that is not needed, but an outright prohibition on it is not needed,” he said.
Federal Energy Minister Josh Frydenberg supported the Mineral Council’s stance.
“There needs to be bipartisan support for nuclear power and that does not exist right now,” Mr Frydenberg said.
“You would also need state-based support and that is not clear at this stage either.”
In a pre-budget submission, the Minerals Council said nuclear energy needed to be “allowed to compete with other low-emissions sources of electricity – and on equal terms”.
“The ban on nuclear power in Australia is hampering an open debate about future energy and climate change management.”
Mr Zavattiero’s position has been supported by the South Australia Nuclear Fuel Cycle Royal Commission, which recommended the lifting of the federal prohibition on a nuclear industry.
Mr Switkowski said smaller, modular nuclear reactors could play a part in the future energy mix, and could support regional centres.
An ANSTO spokesman told Fairfax Media these smaller plants could technically work in Australia.
“If Australia did want to expand into nuclear energy technologies, there would be a number of options to consider in the future, including small modular reactors and Generation IV reactors, which could be feasible if the policy, economic settings and technology were right and public support was in place,” he said.
However, the country currently did not have enough skilled personnel to safely operate a nuclear energy industry, he said.
“The question of whether nuclear energy is technically or economically feasible is a different question to whether Australia should or should not have a nuclear energy program, the latter of which is a matter for policy makers and the people of Australia,” the spokesman said.
Countries such as France have embraced nuclear energy, and nuclear power accounts for nearly 75 per cent of all energy generation.
This reliance on nuclear energy has played a role in helping the nation slash its CO2 emissions, with OECD data outlining France averaging 4.32 tonnes per capita compared to Australia’s average of 15.8 tonnes per capita.
While France had set a timeline to reduce its proportion of nuclear energy generation to half of all generation by 2025, French Environment Minister Nicolas Hulot said it would be difficult to keep to its timeline without reintroducing fossil fuel generation.
The nuclear renaissance is stone cold dead
Well, actually, as of 2018 there is a micro-renaissance resulting from the large number of nuclear power reactor construction starts in the three years before the 2011 Fukushima disaster. Beyond that, decline is near-certain. For more info see:
Nuclear power in crisis: The era of nuclear decommissioning
Do you live near one of the areas most likely to be targeted for nuclear power reactors? Using four primary criteria and six secondary criteria, a report by The Australia Institute identified the following sites as potential sites for nuclear power:
Queensland:
Townsville
Mackay
Rockhampton (e.g. around Yeppoon, Emu Park or Keppel Sands)
Bundaberg
Gladstone
Sunshine Coast (e.g. near Maroochydore, Coolum or Noosa)
Bribie Island area
New South Wales and the Australian Capital Territory:
Port Stephens (e.g. Nelson Bay)
Central Coast (e.g. near Tuggerah Lakes)
Port Kembla
Botany Bay
Jervis Bay and Sussex Inlet
Victoria:
South Gippsland (e.g. Yarram, Woodside, Seaspray)
Western Port (e.g. French Island, Hastings, Kooweerup, Coronet Bay)
Port Phillip (e.g. Newport, Werribee, Avalon)
Portland
South Australia:
Mt Gambier/Millicent
Port Adelaide
Port Augusta and Port Pirie
Western Australia and the Northern Territory were excluded from the Australia Institute siting study because they are not on the National Electricity Market grid. The report does not consider Tasmania in any detail and considers it unlikely that a nuclear power plant would be constructed in Tasmania in the short to medium term.
Siting criteria
The study used four primary criteria for the siting of nuclear power plants in Australia:
1. Proximity to appropriate existing electricity infrastructure; sites close to the National Electricity Market, preferably near existing large generators;
2. Proximity to major centres of electricity demand;
3. Proximity to transport infrastructure to facilitate the movement of nuclear fuel, waste and other relevant materials; and
4. Access to large quantities of water for reactor cooling − coastal sites
Secondary criteria included the following:
1. Population density − sites with adequate buffers to populated areas.
2. Geological and seismological issues.
3. Atmospheric conditions − sites with low risk of extreme weather events and suitable pollution dispersion conditions.
4. Security risk − sites with low security risks (e.g. sufficient buffers to potentially hazardous areas).
5. Sensitive ecological areas − sites that pose minimal risk to important ecological areas.
6. Heritage and aesthetics − sites that pose minimal risk to important heritage areas.
7. Economic factors – sites that accommodate local economic and social factors.
Nuclear priced out of Australia’s future energy equation in new report
By Sophie Vorrath and Giles Parkinson, 26 November 2015, RenewEconomy, http://reneweconomy.com.au/2015/67465
Australia’s official economic forecaster has finally admitted that the cost of nuclear energy is more than double other clean energy alternatives, suggesting it would likely play no role in a decarbonised grid based around lowest costs.
The Australian Power Generation Technology Report – a 362-page collaborative effort from more than 40 organisations, including the CSIRO, ARENA, the federal government’s Department of Industry and Science and the Office of the Chief Economist – clearly shows that solar and wind will be the cheapest low carbon technologies in Australia.
It comes at a critical time, with the nuclear lobby, supported by existing coal generators, pushing nuclear generation heavily, on the basis of previous technology cost assessments that had unrealistically optimistic views of its costs.
But the APGT report has essentially ruled out nuclear power for the whole of Australia, revealing that the technology is becoming more and more prohibitively expensive, at around double the capital cost estimated three years ago – and double the cost of competing technologies.
The research – undertaken by the Electric Power Research Institute (EPRI), Worley Parsons in Australia and Ernst and Young, and peer reviewed by the Australian Government Bureau of Resource Research Economics (BREE) – has been used to provide “credible technology cost and performance data for 2015 to 2030.”
And one of the big take-aways from its findings is that the cost projections for nuclear have changed considerably from previous estimates – particularly the 2012 Australian Energy Technology Assessment (AETA) by BREE, which we described as “astonishing” at the time, given the real-world experience.
Based on the levelised cost of energy (LCOE) – which is the the average cost of producing electricity from that technology over its entire life – nuclear is found to be more expensive than wind and five out of six solar technologies in 2015. By 2030, it is more expensive than everything. And this is the figure that counts, because it is an impossibility that nuclear could be built in Australia before that time. Some would suggest it would take another 10 years.
The cost inputs (of building new nuclear generation) go from roughly $4500/kW (AETA 2012) to $6000 (AETA 2013) to $9000/kW in today’s update.
As noted above, this is quite a revision. The 2012 AETA by BREE evaluated 40 utility-scale generation technologies including large nuclear plants and small modular reactors, and named the latter two among the six lowest-cost options by 2040.
Similarly, the eFuture study by CSIRO showed that the inclusion of nuclear power as an option caused wholesale prices to be 34-37 per cent lower, and led to a 53 per cent nuclear share in 2050.
Today, a spokesperson from the CSIRO said that “as the outlook for nuclear costs has deteriorated with each update, eFuture has accordingly decreased the role that nuclear can play in Australia’s electricity mix.”
As we said last year, getting the LCOE of different energy generation technologies right – or at least improving on previous efforts – is critical for Australia as it makes decisions about its energy future.
The findings of this new report are particularly salient in light of the current SA Royal Commission into nuclear power, especially considering many of the submissions made in favour of nuclear – like this one from the representatives of coal fired generators, and this one from the World Nuclear Association.
Both of these submissions relied on the previous cost estimates from BREE that suggested nuclear was much more cost effective than solar.
The WNA ignored the 2013 cost estimates, and used the 2012 estimates incorporated by the CSIRO to suggest that the inclusion of nuclear power would cause wholesale prices to be 34-37 per cent lower, and would lead to a 53 per cent nuclear share in 2050. The ESAA reached a similar conclusion on wholesale prices.
Both the nuclear and the coal industry lobbies have a shared advantage in slowing down the deployment of wind and solar, because it narrows and ultimately removes the need for large-scale centralised generation. The energy system of the future will be based around dispatch able generation.
On this note, the latest estimates for solar thermal and storage are also interesting – vastly cheaper than the estimates for nuclear, despite the pretensions of many in the nuclear booster camp.
The new report came one day after nuclear power was ruled out as a contributor to the future low-carbon electricity mix of South Australia by a government-commissioned advisory panel, which said it was too expensive.
The South Australian government embraced its recommendation to target net zero emissions by 2030, although held back on its suggestion of going 100 per cent renewable energy. Presumably it will await the outcome of the nuclear royal commission. Hopefully the commission looks at the new cost estimates, and does not rely on hopelessly out of date and optimistic cost estimates.
(The so-called nuclear renaissance was faltering even before the Fukushima disaster as discussed in this 2009 article.)
The fall-out from Copenhagen has left the world’s biggest “carbon criminals”, among them Australia, exposed on climate change. With the overthrow of Malcolm Turnbull in the Liberal party along with the proposed ETS, the ascension of Tony Abbot and his emphasis on “direct action” it was inevitable that the federal Opposition would revisit nuclear power as an option for a low-carbon future in Australia. Given the recent sobering Government report on carbon capture and storage, “clean coal” seems less and less as the likely saviour.
An article on this website by Martin Nicholson (Renewable energy is not as reliable as nuclear, 14/12) proposed nuclear power over alternative renewable energy as the solution to a low-carbon energy future for Australia. Elsewhere with his colleague Barry Brook they have discussed common objections to nuclear power such as safety, waste handling and storage, and weapons proliferation. These, however, are among the most contentious and unresolved issues, both scientifically and politically, and by no means did the authors resolve them to the satisfaction of anyone informed on these topics.
Surprisingly they avoided the single major issue that is much more convincingly resolvable: costs. And a second major issue, that of time.
Advocates of an Australian nuclear industry often cite France as an excellent model to emulate because the French obtain 75 per cent of their electrical power from nuclear. As someone who has lived for a decade in France I agree that it is impressive but since they established their industry four decades ago, partly as a strategic response to poor indigenous energy resources and rising oil import bills, many things have changed. And no one should need reminding that we are nothing like France not least in their bipartisan consensus among both politicians and citizens.
The French not only solved their energy supply but created a successful high-technology export industry. Therein lies a lesson for Australia, but not today in the realms of nuclear energy. It is unconvincing to imagine, with many long-established suppliers of nuclear technology, that there is any space for a Johnny-come-lately such as Australia to establish a competitive industry. The Switkowski report into uranium mining confirms that if we actually started building reactors we would import enriched uranium fuel processed from our own uranium ore exports. A bit like buying back Japanese paper products made from Tasmanian woodchips.
Contrary to the claims of a nuclear resurgence in Europe and the world, it is far from certain how much of Europe will actually implement their plans. Most nuclear plants under construction are in Asia, principally China (15 plants), India (six), South Korea (five) and Russia (nine). Among developed economies Austria, Italy, Norway, Portugal, Poland and Eire (Ireland) have no active nuclear plants and none under construction, though some have plans of varying credibility. The Netherlands has one plant and no plans for any new ones. In France the last completed plant was in 1999. In the UK the last one completed, Sizewell-B, was in 1995 after 14 years of inquiries and protracted construction delays. In the US, the last completed plant took 25 years, opening in 1996.
Only time will tell if the UK, the US or others with much less political and social cohesion can implement their proposed nuclear renaissance. The British Government has already said it will suspend many of the usual democratic processes involved in licensing and site selection. The world will watch to see how that goes.
In the US despite up to 45 new applications for nuclear power plants (licensing processes are advanced for three), no hard investment decisions have been taken on a single new reactor. Of course nuclear power has never stood on its own economic legs and relies upon endless subsidies, tax concessions and government guarantees not to mention government liability insurance including for the unsolved long-term waste handling — or as in France and China, the whole project is government financed and operated.
In countries where the state plays less of a role and the private profit motive reigns, there are obvious reasons why no private interests (stock market, private companies etc) are seriously putting up the money for such plants. As Michael Grunwald reported in Time a year ago: “It turns out that new plants would be not just extremely expensive but spectacularly expensive. The first detailed cost estimate, filed by Florida Power & Light (FPL) came in at a shocking $12 billion to $18 billion.” He cites Rocky Mountains Institute chairman and chief scientist Amory Lovins’ calculations that “new nuclear wattage would cost more than twice as much as coal or gas and nearly three times as much as wind”.
In Europe there are two nuclear plants under construction, one in Flamanville, France and one in Olkiluoto, Finland both by France’s state-owned Areva. Both have been subject to significant troubles, partly related to being the first-build of the most evolved advanced model in production, Areva’s EPR, which was supposed to be simpler, more efficient, cheaper and faster to build. In Finland’s Olkiluotu a 50 per cent blowout in costs (to $US6.4 billion so far, lawsuits pending) and doubling in construction time (from 3.5 years to at least seven years) is typical of nuclear projects over the decades. Today Areva concede that construction of a similar reactor of 1.6 gigawatts would be $US8 billion ($A9 billion).
The reasons why nuclear plants routinely run into such troubles are that it is hugely capital intensive so delays greatly add to the cost of capital long before any revenue is generated. Construction is extremely complex, which is greatly compounded by safety regulation — this was another major cause of the slowdown at Olkiluoto. For these reasons the industry prefers to use “overnight” costs, which are the costs as if a plant was constructed overnight at today’s prices.
Dr Ziggy Switkowski, chairman of the Australian Nuclear Science and Technology Organisation (ANSTO), has said that Australia should build 50 reactors though this assumes a doubling of electricity consumption by 2050. Dr Ian Smith suggested, when chief executive of ANSTO in 2008, that Australia could realistically construct six to 14 plants but this would still provide only 10-20 per cent of total electricity requirements.
Australia’s current electricity consumption is almost 40 gigawatts from installed capacity of about 50 gigawatts. So, to replace most of this would require about 25 reactors of the EPR design, each of 1.6 gigawatts (or 40 of the Westinghouse AP1000 1 gigawatt design). This could cost about $225 billion in today’s money, or close to half a trillion dollars for 50 reactors. Using Smith’s more modest suggestions the cost could be up to $126 billion but displace a lot less coal burning. Switkowski may be correct in the sense that why create all these contentious issues and still not substantially solve the problem? This points to another weakness: with nuclear it appears to be an all-or-nothing gamble with hundreds of billions of dollars.
Nuclear advocates always cite “next-gen” designs and purported much swifter and cheaper construction but the figures given above are the actual costs of the plants being constructed in Europe today, not even the much higher industry estimates reported by Grunwald for the proposed US plants. The timetable of this construction is anyone’s guess except that history warns us to be pessimistic. By comparison China plans for 50-60 of the simpler, smaller Westinghouse design by 2030, but nuclear will still account for only about 4 per cent of their energy needs.
Those are just the construction costs. As is well known, liability insurance needs to be covered by government. The other big cost is the decommissioning of reactors. Even with many of the world’s 439 existing reactors approaching the end of their productive lives, so far none have been decommissioned. The world’s first commercial nuclear power generator, Calder Hall at what is now called Sellafield (previously Windscale), was turned off in 2003. It has been estimated by the UK industry that full decommissioning of Calder Hall, if ever done, will cost about $2 billion at today’s prices. Meanwhile, old plants need continuous maintenance and high-security against decay and incursion including against potential terrorists.
But the biggest cost, especially for Australia, could be the opportunity cost of throwing these vast sums into an old technology dominated by other countries, rather than investing in new renewable technologies and industries of the future. From relatively modest funding Australia has already produced world-beating solar-photovoltaic and solar-thermal technologies, even if both have moved offshore due to lack of investment support. Geothermal power has just received government grants, which will allow full prototypes to be tested in a few years. Many scientists believe that it is inevitable that these technologies will be viable, provide so-called baseload power cost-competitively, and that their maturation would be faster than the typical construction schedules of nuclear power stations if comparable budgets and subsidies were deployed.
Is this any different to the claims by the nuclear dreamers such as Brook and Nicholson? Emphatically yes. The nuclear industry is not a new one but an old mature one. For more than 50 years it has consistently over-promised and under-delivered, yet its advocates continue to propose that governments should provide massive subsidies to nuclear construction, provide unlimited liability insurance, assume most of the decommissioning costs and — after 50 years — continue to search for the elusive “permanent” storage of high-level waste.
There are not minority views and indeed are not contested by the nuclear industry, or the Wall Street Journal, or Lazards the merchant bank. Or many scientists. Here is commentary from the world’s top science journal Nature (W.Patterson, Vol 449, 11/10/07): “As climate and fuel security dominate the energy agenda, the battle between traditional and innovative electricity intensifies around the world, notably in fast-growing economies such as China. After half a century, nuclear power is the ultimate in tradition. It needs climate more than climate needs it. To avert catastrophic global warming, why pick the slowest, most expensive, most limited, most inflexible and riskiest option? In 1957, despite the Windscale fire, nuclear power was worth trying. We tried it: its weakness proved to be economics, not safety. Now nuclear generation is just an impediment to sustainable electricity.”
It is a clear enough choice. The economics and the long time to approve and build show nuclear is not the smart choice, arguably for the world but certainly not for Australia with its plentiful resources in renewables (solar, wind, wave, tidal, geothermal).
The real question for Australia is whether we have what it takes to grasp the opportunities.
Dr Michael R. James is an Australian research scientist.
Uranium enrichment plants can produce low-enriched uranium for power reactors, and they can produce highly-enriched uranium for nuclear weapons. Pakistan and South Africa developed their arsenals of nuclear weapons through the acquisition of enrichment technology. The Iraqi regime was pursuing uranium enrichment until its nuclear weapons program was terminated during and after the 1991 war. North Korea’s nuclear weapons program − based on a uranium enrichment plant and a so-called experimental power reactor − is a source of international concern. There is enormous controversy over the current uranium enrichment program in Iran.
Former Australian Prime Minister John Howard likened a domestic uranium enrichment industry to building factories to knit garments from Aussie wool. But unlike enrichment plants, garment factories can’t produce fissile material for Weapons of Mass Destruction.
We can safely assume that the Lucas Heights nuclear plant in Sydney never operated a secret knitting program. But in 1965, the Lucas Heights plant, then known as the Atomic Energy Commission, did begin a secret uranium enrichment program. It was known as the ‘Whistle Project’ − the idea being that workers would whistle as they walked past and studiously avoid any mention of the secret enrichment program underway in the building’s basement. There is no doubt that the Whistle Project had a military agenda. In the archives of the University of New South Wales, you can find hand-written notes by the then chair of the Atomic Energy Commission, Sir Philip Baxter, in which he calculates how many nuclear weapons could be produced if the enrichment work proceeded as he hoped it would.
The enrichment work was publicly revealed in the 1967-68 Annual Report of the Atomic Energy Commission and the project proceeded in fits and starts until the incoming Hawke Labor government put an end to it in 1984.
In addition to the connection between uranium enrichment and WMD proliferation, the depleted uranium (DU) tailings waste produced in large volumes at enrichment plants can be used in munitions, such as those used by the US and NATO in Iraq, the Balkans and Afghanistan.
Economics of enrichment in Australia
The 2006 Switkowski report stated: “The enrichment market is very concentrated, structured around a small number of suppliers in the United States, Europe and Russia. It is characterised by high barriers to entry, including limited and costly access to technology, trade restrictions, uncertainty around the future of secondary supply and proliferation concerns.”
The Switkowski report concluded that “there may be little real opportunity for Australian companies to extend profitably” into enrichment and that “given the new investment and expansion plans under way around the world, the market looks to be reasonably well balanced in the medium term.”
BHP Billiton’s submission to the Switkowski panel stated:
“BHP Billiton believes that there is neither a commercial nor a non-proliferation case for it to become involved in front-end processing or for mandating the development of fuel leasing services in Australia. Enrichment has massive barriers to entry − including access to technology and approvals under international protocols − and is concentrated with 4 large players: USEC, Areva, Urenco and Tenex, located within the nuclear weapon states of the United States, the United Kingdom, France and Russia respectively. … We do not believe that conversion and enrichment would be commercially viable in Australia. … The economics of any Australian conversion, enrichment or fabrication do not look positive, either individually or collectively. The global market is currently well supplied by services providers with strong customer relationships, economies of scale and scope, the necessary deep technological expertise and experience, solid reputations for delivery, and expansion plans in place.”
Jim Falk et al., 2006, “Australia, uranium and nuclear power”, International Journal of Environmental Studies, Vol 63(6), December, pp.845-857. (Available from jim.green@archive2.foe.org.au)
Looking beyond Iran and North Korea for Safeguarding the Foundations of Nuclear Nonproliferation, former IAEA Safeguards Director Pierre Goldschmidt, Nov 15, 2011, www.npolicy.org/article.php?aid=1115&tid=4
Building Support for the Agencys Safeguards Mission, Henry Sokolski, Nov 03, 2010, Nonproliferation Policy Education Centre, www.npolicy.org/article.php?aid=50&rtid=6
Dr. Brian Lloyd, NT Parliamentary Library Service, Feb 6, 2007, Nuclear Proliferation: Fifth in the series on the Debate on Nuclear Policy in Australia, 2006-2007 www.parlibrary.nt.gov.au/parliamentary_research_papers
This ANSTO-commissioned report argues that nuclear power would be economic in Australia … but only if it is subsidised! John H. Gittus, “Introducing nuclear power to Australia: an economic comparison”:
Statement of Dr. Thomas Cochran, Natural Resources Defense Council, on the Environmental, Safety, and Economic Implications of Nuclear Power Before the Science and Technology Committee House of Representatives, Washington, April 23, 2008,
Paul Leventhal, 2002, Sharon Tanzer, Steven Dolley (eds), Nuclear power and the spread of nuclear weapons: can we have one without the other?, order online e.g. at Amazon.
NSW Inquiry into Nuclear Waste Management 2003-04: NSW Parliament – Joint Select Committee into the Transportation and Storage of Nuclear Waste, 2004 www.parliament.nsw.gov.au/nuclearwaste
Successful campaign against dump in South Australia:
Jacques E.C. Hymans, 2000, “Isotopes and Identity: Australia and the Nuclear Weapons Option, 1949-1999”, Nonproliferation Review, Vol.7, No.1, Spring, pp.1-23, http://cns.miis.edu/npr/pdfs/hym71.pdf
Jim Walsh, 1997, ‘Surprise Down Under: The Secret History of Australia’s Nuclear Ambitions’, The Nonproliferation Review, Fall, pp.1-20, http://cns.miis.edu/npr/pdfs/walsh51.pdf
Alice Cawte, “Atomic Australia: 1944-1990”, Sydney: New South Wales University Press, 1992.
South Australia’s nuclear (weapons) history. SA Nuclear Information Centre paper: “Nuclear weapons proliferation in South Australia 1945-1965” www.ccsa.asn.au/nic/NucHazards/SAweapons.htm
Pro-nuclear environmentalists: There are just a handful of genuine pro-nuclear environmentalists. Most of the discussion and media commentary about pro-nuclear ‘environmentalists’ focuses on people such as self-described eccentric James Lovelock and industry hack Patrick Moore. See the critique posted at http://archive2.foe.org.au/sites/default/files/nuke-enviros.doc
Here’s a short video from ABC TV ‘Hungry Beasts’ program on 5 November 2009 about Neal Blue who is involved in Heathgate Resources (Beverley and Beverley Four Mile uranium mines in SA), including a mention of Heathgate’s employment of a spy who attempted to infiltrate FoE, and Blue’s various weapons-related corporate and political connections in Australia and around the world.
From the ABC ‘Hungry Beasts’ website: “Earlier this year [2009] the Australian Financial Review published their ‘Covert Power’ List featuring the major string-pullers in Australia – big guns like Therese Rein. If you’ve ever wondered who has the real covert power in Australia, you might be interested in reclusive American billionaire Neal Blue. Neal is CEO and Chairman of US arms manufacturer General Atomics, and the man behind Australia’s newest uranium mine, Four Mile.”
The scarcely-believable story of General Atomics / Heathgate Resources
Jim Green – national nuclear campaigner with Friends of the Earth Australia.
The story behind the corporation that owns the Beverley uranium mine in South Australia is scarcely believable.
Heathgate Resources − a 100% owned subsidiary of General Atomics (GA) − owns and operates Beverley and has a stake in the adjacent Beverley Four Mile mine. GA CEO Neal Blue has had commercial interests in oil, Predator drones, uranium mining and nuclear reactors, cocoa, bananas and real estate. His primary political interests appear to be fighting Communism and supporting the far-right.
Radioactive spills and gas leaks at a uranium processing plant in Oklahoma led to the plants closure in 1993. The plant was owned by a GA subsidiary, Sequoyah Fuels Corporation, and processed uranium for use in reactors and for use in depleted uranium munitions. A nine-legged frog may have GA to thank for its dexterity. A government inquiry found that GA had known for years that radioactive material was leaking and that the radioactivity of water around the plant was 35,000 times higher than US laws permitted.
In 1992, a leak at the Oklahoma plant forced the evacuation of a building only two weeks after federal inspectors allowed it to resume operating. Later that year, the company announced that the plant would be closed after it had been ordered to temporarily shut down three times in the previous six years. Sequoyah Fuels Corporation President Joe Sheppard said the company could no longer afford rising costs related to regulatory demands.
The shenanigans and jiggery-pokery at the Oklahoma plant − such as the disposal of low-level radioactive waste by spraying it on company-owned grazing land, and the company’s attempt to reduce the amount of property tax it paid on the grounds that radioactive contamination reduced the value of the land − are documented by the World Information Service on Energy.
GA / Heathgate in Australia
Fortune Magazine recounts one of the controversies surrounding GA / Heathgate’s uranium ventures in Australia. When uranium prices increased in the mid-noughties, the company was locked into long-term contracts to sell yellowcake from Beverley at earlier, lower prices. Heathgate devised plans to renegotiate its legally-binding contracts. Customers were told that production costs at Beverley were higher than expected, that production was lower than expected, and that a failure to renegotiate contracts would force Heathgate to file for bankruptcy.
However former employees said that Blue had allegedly directed Heathgate to increase its production costs. Customers were not told that bankruptcy was unlikely since GA had agreed to continue providing Heathgate with financial assistance.
Two of Heathgate’s Australian directors, Mark Chalmers and David Brunt, consulted an attorney who advised them that the plan could be considered a conspiracy to defraud. Chalmers and Brunt left the company.
Exelon, one of Heathgate’s uranium customers, sued. The lawsuit was settled for about $41 million. Because of the increased uranium price, Blue ended up well in front despite the cost of the settlement with Exelon − more than $200 million in front by some estimates. Blue was unrepentant: “It made more sense to, in essence, just pay the fine.”
Blue has even been sued by his own company. Several years ago, ConverDyn, a uranium conversion plant jointly owned by GA and Honeywell, sued Blue, Heathgate and GA in relation to allegations of a failure to meet contractual obligations to deliver certain amounts of uranium.
Federal Resources Minister Martin Ferguson declined to comment when asked about GA / Heathgate’s activities in 2009.
The US Center for Responsible Politics calculated that GA spent over US$1.5 million annually in lobbying efforts from 2005 to 2011. GA / Heathgate has repeatedly flown US politicians (and their families and aides) to Australia for high-level talks and it has paid for Labor MPs to travel to the US. The company has used the services of PR firm Hawker Britton, which includes many former Labor politicians and staffers.
Money well spent, it seems. In 2006, then SA Treasurer Kevin Foley said: “I have visited the Beverley mine and, recently, in San Diego I met Mr Neal Blue, the chairman of General Atomics – an outstanding company that is producing uranium oxide from the Beverley mine. I only hope that further deposits of uranium can be found. The sooner we can find it, dig it up and get it out of the country, the better.”
Infiltration of environment groups
GA / Heathgate has employed at least one private investigator to infiltrate environment groups in Australia. The infiltrator, known as Mehmet, had previously infiltrated green groups as part of an undercover police operation before he moved into the private sector to set up his own security company, Universal Axiom. He also provided personal protection to visiting GA executives. When asked about the company’s tactics, a Heathgate spokesperson said the company was privately owned and had a policy of not responding to media questions.
People who worked at Friends of the Earth at the time − around the turn of the century − say they were highly suspicious about Mehmet from the get-go. His activities might have been laughable and pathetic except that he provided exaggerated information to police about the likely attendance at a protest at the Beverley uranium mine in May 2000. That led to an excessive police presence at the protest and police brutality against environmentalists and local Aboriginal people. An video of this brutality is posted at australianmap.net/beverley-uranium-mine. Heathgate applauded the police action.
After a 10-year legal case, 10 people were awarded a total of $700,000 damages. Supreme Court Judge Timothy Anderson described the imprisonment of protesters in shipping crates as “degrading, humiliating and frightening” and noted that the action constituted an “affront to the civil liberties of the protestors”. He added: “The conditions were oppressive, degrading and dirty, there was a lack of air, there was the smell from capsicum spray and up to 30 persons were crammed into a very small space.”
Judge Anderson also strongly criticised the SA government’s withdrawal from attempts to resolve the case through mediation. He said that SA government Ministers Kevin Foley and Michael Wright “acted with a high-handed and contumelious disregard of the plaintiffs as citizens of the state with a right to protest, and with the right to be treated according to law if they did protest.”
Heathgate’s record at Beverley has been substandard. At least 59 spills have been documented at the mine. The company sells uranium to nuclear weapons states (all of which are in breach of their disarmament obligations under the Nuclear Non-Proliferation Treaty), to at least one country with a recent history of secret nuclear weapons research (South Korea), and to countries which refuse to ratify the Comprehensive Test Ban Treaty.
Heathgate’s activities at Beverley have been extremely divisive among Adnyamathanha Traditional Owners. Some Adnyamathanha Elders have formed an Elders Group as a separate forum from the Adnyamathanha Traditional Lands Association. Enice Marsh said: “There have been many attempts over the past 10 years to try and bring greater accountability to what’s happening in Native Title, and to stop the ongoing assault on our Yarta (country). Many of us have tried with very little resources, limited understanding of the legal system and environmental laws, and despite a mountain of bullying, lies and deceit from mining companies, lawyers, and self-inflated thugs in our own community who dare to call themselves ‘leaders’.”
The predator
Neal Blue, CEO of defense contractor General Atomics, has transformed the way the U.S. military fights wars. But it is his take-no-prisoners approach to business that has made him infamous.
(Fortune Magazine) — It’s hard to pin down exactly when Neal Blue decided to start building weapons. It was probably in the early 1980s, around the time he bought much of Telluride, Colo., but before he began mining uranium and sometime after he gave up growing cocoa and bananas in the Nicaraguan jungle.
Back then Blue was a Denver oilman and real estate investor who happened to spend a lot of time thinking about how to defeat communists. He was particularly interested in seeing the overthrow of the Soviet-backed Sandinistas, who had recently seized control of Nicaragua. He had known the Somozas, the ousted ruling family, from his cocoa and banana days, and, well, he hated Reds.
Crippling the regime, Blue figured, was simple: just send GPS-equipped unmanned planes on kamikaze missions to blow up the country’s gasoline storage tanks. “You could launch them from behind the line of sight,” he recalls matter-of-factly, “so you would have total deniability.”
Blue pauses, leans back in his white-leather swivel chair, and quickly adds that he had nothing to do with any of the Reagan-era operations there – nor, of course, did he launch his own attack. We are sitting in his small, sunny office near San Diego, not far from the Navy’s so-called Top Gun Academy.
Behind him unfolds a rambling campus of 1950s-futuristic buildings, home to General Atomics Technologies Corp., parent of one of the most important defense companies in the world and the centerpiece of Blue’s privately held – and secretive – business empire. Over the course of his five-decade career he’s built a sprawling global business that spans four continents and enriched his family. But he has also made enemies and infuriated customers.
Blue is one of the last of the old-school industrialists, a breed that is all but extinct in professionally managed, post-Sarbanes-Oxley corporate America – a modern-day Howard Hughes (minus that whole starlet-dating, obsessive-handwashing part).
Through a combination of entrepreneurial instincts, bold legal maneuvers, and all-out bullying, Blue and his younger brother, Linden, have assembled assets worth billions of dollars (it’s all private, so no outsider knows exactly how much), including an environmental cleanup firm in Germany, extensive uranium mines in Australia, real estate in Colorado, substantial oil and gas interests in Canada, and an airplane de-icing company in Iowa.
But General Atomics is best known for manufacturing one of the most important tools in modern warfare: the Predator, an unmanned spy plane that commanders in Iraq and Afghanistan credit with helping them fight insurgents. (The Pentagon recently announced that the Predator would increasingly take over the hunt for Osama bin Laden.)
“I once asked Neal how he does it,” says Harold Agnew, the former director of Los Alamos Scientific Laboratory, who sits on GA’s board. “And he said, ‘My golden rule is to always buy straw hats in the winter.'”
Blue is a razor-sharp businessman, and interviews with dozens of Blue’s associates and sparring partners suggest that he will do anything to maximize profit – even if it means violating agreements. And while some who have locked horns with him simply shrug their shoulders and move on, a few have taken him to court for breach of contract, fraud, and racketeering.
Blue admits to breaking contracts but won’t comment on the rest. In Telluride, not far from where he grew up, the town even seized much of his land after a bitter fight with residents.
“I have used his house there periodically,” says David Goldberg, Blue’s friend and longtime business advisor, “and I have always advised my guests never to sit on the porch for fear of being ‘duly rewarded’ by the passing populace.” (Translation: Duck and cover.)
Neal Blue is 73 years old but could easily pass for 50, thanks to his boyish face and fit build. Although shy in public, he’s a good storyteller and speaks with authority about everything from John Locke to nuclear physics. Conversations can easily turn into often mind-bending monologues that last hours – a phenomenon some of his employees call “Blue-speak.”
Blue’s father was a real estate investor, and his mother the first woman to be Colorado’s treasurer. He was a born opportunist. One high school friend remembers that during a public-speaking class he unabashedly played to the teacher’s Catholic faith: When Blue was to practice giving an award, he presented a national championship trophy to the University of Notre Dame. When he had to talk about great architecture, he picked the Vatican.
“Everyone in the class would just roll their eyes,” says Norman Augustine, former chairman of Lockheed Martin, who grew up with him in Denver. “But Neal got an A, and the rest of us didn’t. That was vintage Blue.”
It was also vintage Blue, friends say, to finance a road trip from France to India with his Yale buddies by selling articles to the New York Times and persuading Chrysler to donate a Dodge station wagon.
Blue outdid himself the following summer when he and Linden decided to fly a small plane over the Andes Mountains. It didn’t matter that they didn’t yet know how to fly. “Those were just details,” Blue says with a wry smile.
That exploit, which was featured on the cover of Life magazine in 1957, laid the groundwork for the Blue brothers’ future. After hearing that cocoa farming was a way to make money quickly, the brothers arranged financing to buy a slice of Nicaraguan jungle on the Caribbean coast, built an airstrip, and started planting.
While that venture failed, they had more success investing in sugar plantations, petroleum, and real estate. Neal was always looking for those straw hats. One morning in mid-1985 he read in the Wall Street Journal that Chevron (CVX, Fortune 500) was looking to sell some of the assets of newly acquired Gulf Oil. Sensing a bargain, he called Goldberg, his trusted advisor.
Soon Goldberg and the Blues flew to San Diego to look at an odd research entity that came with Gulf Oil. Founded as the nuclear think tank for General Dynamics (GD, Fortune 500), the unit, called General Atomics, had lost direction after being sold and resold to various oil companies. It built small nuclear reactors and pioneered a gas-cooled reactor for power generation – a technological coup but a commercial failure. The company also ran the country’s largest fusion reactor.
“Neal was exceedingly unimpressed by it,” says Goldberg. “But he was smart enough to spot it as a terrific real estate opportunity…. And he was smart enough to realize it might even be a place where he could do something with his ideas of transforming military doctrine.”
Blue has long believed that when it comes to innovation, the military is almost always wrong. The armed forces are always buying overpriced technology designed for the last war. During his first days at General Atomics in 1986, Blue gathered the company’s employees and laid out his vision: General Atomics would be remade in the image of the Hughes Aircraft Corp., back when its founder was still running it.
And like Howard Hughes, who often used his companies as vehicles for pursuing his obsessions, Blue soon announced that the company would begin research on his pet project: unmanned aerial vehicles. The company’s employees, mostly engineers and nuclear physicists, were shocked.
Blue had originally conceived the aircraft as kamikaze strike weapons or as cheap cruise missiles, but after the Pentagon put out a call for an unmanned surveillance plane in 1993, Blue changed his mind. To execute his vision, he hired Tom Cassidy, a retired Navy admiral and commander of the service’s elite Top Gun Academy. (When the producers of the Tom Cruise movie needed a gruff admiral for a bit part, they cast him.)
Cassidy’s team stuck to off-the-shelf parts, using cameras made for traffic helicopters and a Bombardier engine originally designed for snowmobiles. He named it the Predator.
Air Force officials were initially unmoved: After all, many of them were former pilots – and no pilot has ever picked up a girl in a bar by bragging he flew a remote-controlled plane. More important, the Air Force was sinking hundreds of millions into a next-generation fighter jet, the F-22.
But the Predator was cheap (the original Predator cost a mere $10 million per plane) and scarily effective at providing intelligence. It was quiet and could fly for a full day at 25,000 feet, recording and relaying real-time video to commanders on the ground. Current versions even shoot Hellfire missiles.
Although the first Predator was launched during the mid-1990s Balkans conflict, it wasn’t until the wars in Iraq and Afghanistan that military commanders integrated it into their arsenals.
“It is difficult,” says Dyke Weatherington, the Pentagon’s deputy director of unmanned warfare, “for us to keep up with the demand for these from the field.”
While GA refuses to disclose its revenue or profits, the aeronautics business, which operates as a separate company, has sold more than $2.4 billion worth of drones and other equipment to the U.S. military in the past decade.
There are many sides of Neal Blue. There is the charming side he shows to reporters – military innovator, gutsy entrepreneur, and learned scholar. And there is the relentless side known only to his customers and the people who survive working for him.
ConverDyn, a uranium-processing subsidiary that GA co-owns with industrial giant Honeywell, recently sued Blue (that’s right, his own company sued him) and described his business practices as “fraudulent, malicious, and willful and wanton.”
This and other related lawsuits highlight Blue’s unique blend of questionable conduct and business foresight. He got into the sugar business in the early 1970s before it hit its all-time high. He invested in natural gas when prices were controlled, and he minted money after it was deregulated.
And he recognized that uranium was a commodity that was so “out” that it had to be “in” one day. During the 1980s he bought tracts of land in the Australian outback when mining uranium there was banned. He gambled that a new administration would rewrite the laws to his advantage, then patiently waited a decade to be proven right.
In 2001, when Blue started producing the radioactive metal, it sold for approximately $8 a pound on the spot market. Three years later the price had about doubled, but Blue was locked into long-term contracts to sell much of the metal to utilities at close to 2001 prices.
Realizing the company was losing a tremendous opportunity, his subordinates allegedly devised a plan. An internal memo prepared by General Atomics’ uranium subsidiary, Heathgate, in March 2004, recommended canceling or restructuring the contracts. The memo presented four options for backing out of the various deals, ranging from an intentional failure to deliver to allowing the subsidiary to file for bankruptcy.
Blue’s company chose a controversial middle ground. It would approach customers and ask for concessions, saying its cost of production was higher than expected and that the mine was producing less than it had anticipated. Some customers were handed documents confirming those assertions and suggesting that if the contracts weren’t renegotiated, Heathgate would have to file for bankruptcy.
What the companies weren’t told was that, according to former employees, Blue had allegedly directed the company to increase its costs. Plus the company couldn’t immediately go broke, since GA had agreed to continue providing Heathgate financial assistance – another fact conveniently left out of reports to customers.
Many of Blue’s longtime employees saw this as tantamount to railroading customers. Two of Heathgate’s Australian directors, Mark Chalmers and David Brunt, were so worried about the legality of what they were doing that they consulted an outside attorney. That lawyer advised them that implementing the plan could be considered a “conspiracy to defraud and the commission of at least one criminal offense by each director, which would be very difficult to defend.” Soon Chalmers and Brunt were no longer employed by Heathgate.
Most customers agreed to renegotiate. But as the price of uranium continued to skyrocket – it had reached over $40 by early 2006 – Heathgate again told its customers that it was experiencing higher than expected production costs, lower than anticipated volumes, and did not have enough uranium to fulfill its orders.
The lawsuits allege that these contentions were grossly exaggerated. That year, Blue’s executives told Chicago-based Exelon (EXC, Fortune 500), a $19-billion-a-year utility, that Heathgate would not deliver any uranium unless Exelon released them from the rest of the contracts. When the company refused, Heathgate and GA informed it that they would make no more deliveries. Exelon sued.
But Blue figured that didn’t matter. He says the most they could sue him for was the “maximum liquidated price,” or the amount of uranium times the price in the contract. In the meantime he could sell that disputed metal on the spot market for prices that peaked last year at nearly $140 a pound.
Exelon’s lawsuit against General Atomics’ parent company was settled in the spring for about $41 million, according to Exelon’s SEC filings. The amount Blue made selling that same uranium on the spot market? More than $200 million, by some estimates.
While Blue won’t discuss the specifics of the case – the settlement agreement is confidential – he doesn’t seem concerned by the allegations in the lawsuits. In fact, he is utterly unrepentant.
“If you’re a profit-center manager, you look at what are your contractual obligations,” Blue says. “It’s not your obligation to give as much as possible from your company to someone else…. It made more sense to, in essence, just pay the fine.”
One afternoon this past summer, Blue pulled up in his brand-new silver Volkswagen outside one of his company’s manufacturing facilities north of San Diego. It was 85 degrees, and he was wearing a short-sleeved blue dress shirt and dark-gray pants. Inside the warehouse were row upon row of remote cockpits for Predators.
From takeoff to landing, the Predator can be controlled with a joystick by a pilot sitting in a trailer thousands of miles away. But the original Predator “cockpit” looked more like a computer console than the deck of a fighter jet.
The new prototype Blue was here to inspect aimed to fix that. Indeed, it looked like a cross between a high-end videogame and the multimillion-dollar simulator airlines use to train pilots. But the system was buggy, and the video was so jittery that it hurt your eyes to look at it.
Blue’s face dropped. “This shouldn’t be like this,” he snapped at a young programmer who was demonstrating the machine. His voice rose. “This is totally unacceptable. Wouldn’t you agree? What is your problem? Why can’t you get this stuff right?”
The pressure of GA’s success – and the challenges Blue is facing in his other operations – may be taking a toll. The aeronautics business has grown so fast that it has apparently experienced production problems.
Northrop Grumman (NOC, Fortune 500) recently beat it out for a $1.6 billion contract to produce drones for the Navy. According to a recent report by the Government Accountability Office, the Navy had “substantial doubt” that the company would deliver the drones as promised. The Predator maker says the GAO report references “select instances of past performances,” and it has since increased resources and staffing.
“That’s just part of the capitalist world, which has provided so much to so many,” Blue says. “But I suppose the fundamental essence of our portfolio, aside from some measure of economic balance, is ‘Okay, how do you make a difference?’ And in my case, it is in developing transformational technologies that could change the world. The rest of all this doesn’t really matter.”
It is a prime example of Blue-speak – a measured but completely unremorseful response that belies the sharp elbows and strong-arm tactics Blue often uses to achieve his goals. And it is perfectly in keeping with his stubbornly old-fashioned brand of doing business.
As Howard Hughes said, “Once you do consent to some such concession, you can never cancel it and put things back the way they were.” He didn’t have an heir, but Neal Blue sure comes close.
Arms maker behind uranium mine settled fraudulent pricing case
Nick O’Malley and Ben Cubby, Sydney Morning Herald, 30 July 2009
THE arms manufacturer that received approval through an Australian subsidiary for a new uranium mine in central Australia this month was sued for fraudulently hiking uranium prices and manipulating costs at a neighbouring mine.
Neal Blue, owner and chairman of General Atomics, was accused in the proceedings of instructing executives at his Australian subsidiary, Heathgate Resources, to prepare false reports for customers, telling them costs at Heathgate’s Beverley uranium mine were higher than anticipated, and production lower.
The strategy was allegedly calculated to break contracts with US companies buying Australian uranium from Mr Blue’s company at low, fixed prices. According to court documents, the plan was hatched in 2004 when world uranium prices spiralled, as nuclear power came to be seen as a way of achieving greenhouse gas cuts.
Those companies that did not agree to allow Heathgate to break its contracts and increase prices were allegedly told Heathgate would file for bankruptcy. Mr Blue contested the claims and the proceedings were eventually settled.
Mr Blue was not available to speak to the Herald, but when questioned about the case by Fortune magazine last year said: “If you’re a profit-centre manager, you look at what are your contractual obligations. It’s not your obligation to give as much as possible from your company to someone else … It made more sense to, in essence, just pay the fine.”
The Illinois District Court case was settled last year. One of General Atomics’s customers, Exelon, received $US41 million from the company. It is estimated Mr Blue made $US200 million by breaking the contracts and selling uranium on the spot market as commodity prices rose.
As Mr Blue’s strategy unfolded, two Heathgate directors, Mark Chalmers and David Brunt, were so concerned they hired a lawyer who advised “the plan could be considered a ‘conspiracy to defraud and the commission of at least one criminal offence by each director, which would be very difficult to defend’.”
Soon after, the men’s relationship with Heathgate ended. Today they are respectively managing director and director with Uranium Equities. Neither would comment for this story.
The Resources Minister, Martin Ferguson, and the Environment Minister, Peter Garrett, who approved the Four Mile uranium mine, were unavailable for comment yesterday.
General Atomics is best known for making the Predator drones playing an increasing role in wars in Afghanistan and Iraq, but it also has interests in uranium processing and mining.
Four Mile mine will be owned by a General Atomics subsidiary, Quasar Resources, and an Australian-owned minerals explorer, Alliance Resources.
GENERAL ATOMICS, the company behind the nation’s newest uranium mine, has been patiently lobbying Australian politicians for more than a decade to encourage it to allow mining, to develop nuclear reactors and buy high-tech weapons.
The company has ferried members of the US Congress, their families and aides to Australia for high-level talks. It has paid for Labor MPs to travel to the United States to see its weapons and nuclear reactors first-hand, as well as hosting taxpayer funded trips.
In 1999, a federal Labor opposition frontbencher, Martyn Evans, was flown to the US for a four-day visit to the General Atomics headquarters in San Diego. This was at the expense of Heathgate Resources, the General Atomics subsidiary that operates the Beverley Uranium Mine in South Australia.
To put its case for more mines and more weapons in Canberra, the company uses Hawker Britton, a lobbying firm that includes many former ALP staffers and MPs.
But among the biggest supporters of uranium mining expansion is the South Australian Premier, Mike Rann, who was on the Greenpeace executive that launched the Rainbow Warrior protest ship to try to block French nuclear weapons tests in 1972.
Mr Rann, who also chaired the Nuclear Hazards Committee of the ALP in the early 1980s when the party was opposed to uranium mining, now believes that modern mining techniques are safe enough. He travelled to Dallas to meet Mr Blue last year and said on his return that he was an “unashamed supporter” of uranium mining.
In 2006 the South Australian Treasurer, Kevin Foley, spent $120,000 travelling the US to meet leading arms manufacturers including General Atomics, but it was apparently not his first visit. The previous year he told South Australia’s Parliament that he had already visited Mr Blue.
“I have visited the Beverley mine and, recently, in San Diego I met Mr Neal Blue, the chairman of General Atomics – an outstanding company that is producing uranium oxide from the Beverley mine. I only hope that further deposits of uranium can be found. The sooner we can find it, dig it up and get it out of the country, the better,” he said.
Also in 2006, General Atomics flew a group from the US Congress to Australia, accompanied by company executives, to persuade the Federal Government to buy the company’s Predator unmanned aircraft. The colourful group included a retired US Navy admiral, Tom Cassidy, a former pilot who had a cameo role in the Tom Cruise film Top Gun.
A report by the US Centre for Public Integrity found the trip cost $US184,000, and established that General Atomics was the biggest corporate sponsor of travel for US Congress officials since 2000.
The members of the US Congress on the Australia trip denied attempting to boost General Atomics sales on the trip, saying it focused on strengthening military ties and discussion on the war against terrorism. The Australian Defence Force tested a General Atomics robot surveillance aircraft that year.
As well as its interest in unmanned spy planes, General Atomics has employed human spies. Last year it was caught hiring a former undercover police officer turned private investigator to infiltrate Australian environment groups and report on their actions. The former officer was posing as a Kurdish refugee and feeding information back to General Atomics.
Digging dirt with a sledgehammer
Nick O’Malley and Ben Cubby, Sydney Morning Herald, 30 July 2009
The weapons manufacturer who converted Labor’s staunchest opponents to nuclear development has a controversial past, writes Nick O’Malley and Ben Cubby.
As a rule, Neal Blue’s employees – past or present – don’t like to talk about the boss. Not on record, anyway. Off the record, the same words keep coming up when they describe him. They say the man behind Australia’s newest uranium mine is brilliant and tough, private and autocratic. They say he is ruthless.
“Look at Telluride,” says one former associate. “That’s who Neal Blue is.”
Telluride is a ski town of astonishing beauty in the Rocky Mountains. In 1983 Blue, then making his first fortune in real estate, bought the valley floor beneath Telluride and, in 1998, moved to subdivide it and build mansions. Many objected and convinced the county to protect the land. After a string of legal battles a court decided that if Blue was paid $US50 million the county could keep its rolling green meadow.
The tight-knit community rallied to raise the money. Married couples cancelled honeymoons and donated their savings, sports teams passed the hat around, children sold lemonade. The county met the fund-raisers dollar for dollar and wealthy benefactors, including the actress Daryl Hannah, kicked in the last few millions. With days to spare the money was raised and the campaigners celebrated.
Blue wasn’t bowed. He turned to the state legislature, which introduced a retrospective law preventing the county from resuming the land. A judge found the law unconstitutional and Blue fought that too, in the Colorado Supreme Court. He lost.
After 25 years had passed and about $US60 million was spent in compensation and legal fees, the valley floor was saved, but the town of Telluride was divided and its budget blown.
One of the campaigners was bewildered by Blue’s ferocity. A judge involved in mediation told her the residents never understood that to Blue the issue was not the money but winning.
“That’s what I’m saying,” a former associate told the Herald. “He’s just an asshole.”
The battle for Telluride reveals much about Blue. It demonstrates his willingness to invest over the long term on long shots. His golden rule is said to be “always buy straw hats in winter”. There is ruthlessness too, and tenacity. And the tale suggests that to Blue, now 74, the law is a weapon to be wielded.
Such single-mindedness emerged during the battle over a Blue-owned uranium processing plant on an Indian reservation in Oklahoma.
After a series of radioactive spills a nine-legged frog was discovered outside the yellowcake factory.
A government investigation eventually established the company had known for years that radioactive material was leaking and that radioactivity in water around the plant was at levels 35,000 times higher than US federal laws permitted.
After a toxic gas leak in 1992 it was finally closed. A clean-up of the site should finish by 2012.
Blue and his younger brother and business partner, Linden, first came to public notice in a picture on the cover of Life magazine in 1957. The two high school graduates are crammed into the tiny cockpit of the light aircraft they had just piloted over the Andes.
The same cover carries the headline “Soviet inroads in Arab world”. This too is part of the Blue story.
Last year Blue, who would not be interviewed for this story, told Fortune magazine how in the 1980s he first thought of using pilotless aircraft as weapons. The fervent anti-communist figured remote control light aircraft could be used to blow up oil pipelines to cripple the Soviet-backed Sandinista regime in Nicaragua.
Those idle thoughts bore fruit. In 1986 Blue bought General Atomics, the research arm of a larger nuclear power company.Just a decade later the company’s Predator drone aircraft were in the air over the Balkans and the company was on its way to earning Pentagon contracts worth hundreds of millions of dollars.
As General Atomics grew, Blue kept an eye on Australia. One of his former employees recalls that in the late 1980s Blue was sure the future was nuclear and Australia was going to be a key part of it.
He went about buying pastoral leases sitting on uranium deposits in South Australia and the Northern Territory, gambling that bans on uranium would one day be lifted.
He was right. In 1990 Blue established Heathgate Resources to operate the new Beverley uranium mine, near Lake Frome in South Australia.
The South Australian Government has recorded 59 spills of radioactive material on the surface at the site, though none are considered serious and the company has not breached its licence conditions. Because the mine does little surface damage there is no requirement it decontaminate the site when mining ceases.
The environmental impact assessment for Blue’s nearby Four Mile mine, approved this month by the federal Environment Minister, Peter Garrett, similarly carries no such requirement.
General Atomics and Blue did run into trouble over the sale of its Australian yellowcake overseas, however. Exelon Generation, a US energy company, sued General Atomics for allegedly lifting its uranium prices and preparing false reports for customers. The case settled last year.
Blue was unrepentant, telling one journalist it made more sense to pay a fine than lose more money using less confrontational practices.
“He did teach me one thing, though,” says a former associate. “Given the will, and the way, and a sledgehammer, you can achieve almost anything.”
As his uranium interests in Central Australia began to realise their potential, another Blue company was locked in combat over the rich oil and gas fields of the Timor Gap. Blue had acquired the company Oceanic, which claimed to have secured the rights to the resources from Portuguese Timor in 1974.
Once Indonesia’s occupation ended it sought – and failed – to resume those rights.
In 2004 Blue took on the successful bidder, ConocoPhillips, the Timor Sea Designated Authority and the Indonesian Government-owned resources giant Pertamina, demanding $30 billion in damages. Oceanic claimed the then East Timor prime minister, Mari Alkatiri, and other Fretilin members of parliament had been bribed.
In May last year a judge in Houston, Texas, dismissed the last claims, declaring that “Oceanic asserts abstract operative facts – bribery, hostility, causation, and damage. It supports the abstractions with over 50 pages of trivia.”
An appeal by Oceanic is continuing.
One man who will speak about Blue is Geoff McKee, a petroleum engineer whom Blue hired to work on the Timor Gap bid. McKee remembers Blue as a charming dinner companion and a warm father to his two sons – both now in business with him – and as a genius.
“If Alkatiri had gone with Blue they [East Timor] would have an LPG plant with a pipeline to Australia up and running by now.”
McKee believes that Blue’s dogged pursuit of the lawsuit was driven in part by Alkatiri’s refusal to meet him. “He is used to powerful people taking his calls,” McKee says.
Peter Garrett’s U Sky Mining
Jim Green, Chain Reaction #107, November 2009, www.foe.org.au/chain-reaction
And some have sailed from a distant shore
And the company takes what the company wants
And nothing’s as precious, as a hole in the ground
— Midnight Oil, Blue Sky Mining
Federal environment minister Peter Garrett justified his July 14 decision to approve in situ leach (ISL) uranium mining at Beverley Four Mile in South Australia with the claim that he had “set the bar to the highest level” and was applying “world’s best practice” environmental standards.
Thus Garrett added another chapter to the history of spin surrounding ISL mining. He has not insisted on rehabilitation of polluted groundwater at Beverley Four Mile. Moreover, he did not insist on an Environmental Impact Statement from the mining proponents but allowed a lower level of assessment, a Public Environment Report. On both counts, Garrett failed to live up to his own rhetoric.
ISL mining involves pumping an acidic solution into an aquifer, dissolving uranium and other heavy metals and pumping the solution back to the surface. After the uranium has been separated, liquid waste – containing radionuclides, heavy metals and acid – is simply dumped in the aquifer.
Proponents of ISL mining claim that ‘attenuation’ will occur over time − that the groundwater will return to its pre-mining state. However there is considerable scientific uncertainty about the future of ISL-polluted groundwater and uncertainty about the timeframe for attenuation if it does occur. A 2003 Senate References and Legislation Committee report recommended that “mines utilising the ISL technique should be subject to strict regulation, including prohibition of discharge of radioactive liquid mine waste to groundwater”. Garrett has rejected that Senate Committee recommendation.
Geoscience Australia has been commissioned by the federal government to carry out a review of ISL mining. Its draft guidelines include consideration of alternatives to dumping liquid waste in groundwater − specifically, it mentions the option of “evaporation to solid residues and disposal on site (or at a low level radioactive waste repository)”. Garrett had the draft report from Geoscience Australia before making his decision but still chose to allow liquid waste to be dumped in groundwater.
Following the 2003 Senate inquiry, The SA Labor government commissioned a study by scientists from the CSIRO and the Australian Nuclear Science and Technology Organisation. The study had all the hallmarks of a whitewash yet still acknowledged that attenuation is “not proven” and could only cite a period of “several years to decades” for it to occur. Yet the companies proposing to use ISL mining at Beverley Four Mile want to absolve themselves of any future responsibility for the site just seven years after they have finished mining.
ISL uranium mining is used at the Beverley uranium mine (10 kms from Beverley Four Mile) and it is the mining method proposed for Beverley Four Mile, Oban and Honeymoon. The future of ISL mining is plain to see − short-lived mines leaving a lasting legacy of polluted aquifers.
In addition to the pollution of groundwater, surface spills and leaks are a common feature of ISL mining. The SA Department of Primary Industry and Resources lists 59 spills at the Beverley mine from 1998-2007.
The horrendous environmental legacy of ISL mining in former Soviet and eastern European states is dismissed by ISL proponents as being a result of Soviet-era mismanagement and neglect. But the same problems are evident in Australia: captured bureaucracies; slack regulation; Orwellian doublespeak (e.g. ‘world’s best practice’); secrecy (for example, the Australian Conservation Foundation had to appeal to the SA Ombudsman to get Heathgate to release crucial information about the Beverley mine, such as the Groundwater Monitoring Summary); and questionable corporate practices (for example, Heathgate employed a private investigator in the late 1990s who attempted to infiltrate Friends of the Earth).
Adnyamathanha Traditional Owners
Garrett noted that there is an agreement between the mining proponents and the Adnyamathanha Traditional Lands Association in relation to Beverley Four Mile. But he knows that the agreement falls a long way short of free, prior and informed consent. Traditional Owners have no right of veto under SA or federal legislation.
In a July 15 statement, Adnyamathanha Elders Enice Marsh and Geraldine Anderson called on Garrett to reverse his decision at least until the completion of an investigation being conducted by the SA government into long-standing Aboriginal heritage concerns raised by Adnyamathanha Traditional Owners.
Enice Marsh said:
“Adnyamathanha Elders wrote to [SA Aboriginal Affairs Minister Jay Weatherill] weeks ago raising our concerns, and he promised to do an investigation into the Four Mile proposal. His jobs is to make sure heritage laws are followed. If he won’t use his powers he should be sacked. …
“We have no decision making power under Native Title, we have been forced into signing a Native Title Mining Agreement that gives us royalty compensation. If we refused to sign it the proponent has the right to take the matter to the ERD [Environment, Resources and Development] Court and cut us out of the process altogether. Aboriginal people have no rights under Native Title to protect out heritage. Look at what’s already happened and how people have just given in to the pressures. …
“What more can we do to protect our land from being raped by mining companies that are allowed to pollute the water and carve up the waterways, even contaminate the soil with radioactive waste? The general public need to know what is going on and ordinary people need to take action to stop the abuse of our environment.”
In addition to their battle with state and federal governments and mining companies, some Adnyamathanha Elders are battling within their own community. They have formed an Elders Group as a separate forum from the Adnyamathanha Traditional Lands Association. According to Enice Marsh: “There have been many attempts over the past 10 years to try and bring greater accountability to what’s happening in Native Title, and to stop the ongoing assault on our Yarta (country). Many of us have tried with very little resources, limited understanding of the legal system and environmental laws, and despite a mountain of bullying, lies and deceit from mining companies, lawyers, and self-inflated thugs in our own community who dare to call themselves ‘leaders’.”
Even those Adnyamathanha custodians who supported the agreement to mine Beverley Four Mile seem unimpressed with the process. Vince Coulthard, chair of the Adnyamathanha Traditional Land Association, told ABC radio on July 17: “Well I think people have come to the understanding that if they didn’t support it, it’s going to happen in any case so the best thing to do is to negotiate an agreement.”
Traditional Owner Geraldine Anderson said: “This Labor Government is saying sorry to the Stolen Generation, on the other hand they’re taking the way of destroying our sites and taking our identity away. So when’s this going to stop?”
If and when the abuse stops, it will be despite and not because of Peter Garrett. Presumably Garrett is prepared to sell out on long-held principles in the pursuit of broader political goals. He ought to have asked Adnyamathanha custodians if they are willing to be sacrificed in the pursuit of his goals and ambitions.
Military links
The Four Mile lease is owned by Quasar Resources (an affiliate of Heathgate Resources) and Alliance Craton Explorer, and the mine will be operated by Heathgate Resources (an affiliate of US weapons and nuclear energy corporation General Atomics).
The Sydney Morning Herald reported on July 16 that James Neal Blue, a “colourful but reclusive billionaire”, is a director of Quasar Resources and chair of General Atomics. Blue first came to prominence in the 1980s as a self-described “enthusiastic supporter” of US involvement in the covert war against the Nicaraguan government.
The Beverley Four Mile deposit is estimated at 30,000 tonnes of uranium. Used in power reactors, that amount of uranium would produce 4,500 tonnes of high-level nuclear waste (in the form of spent nuclear fuel) and enough plutonium to build 4,500 nuclear weapons.
The major customer for the uranium is likely to be the US, a nuclear weapons state which has no intention of fulfilling its binding disarmament obligations under the Nuclear Non-Proliferation Treaty and which has for many years blocked progress on the Comprehensive Test Ban Treaty and the proposed Fissile Material Cut-Off Treaty.
Jim Green is the national nuclear campaign with Friends of the Earth, Australia.
On July 14, 2004, the federal government announced that it had abandoned plans to build a national radioactive waste dump in South Australia. The backdown was a major victory for the environmental and Aboriginal organisations which fought the dump plan for over six years.
The government announced its intention to build the dump near Woomera, 500 kms north of Adelaide, in February 1998 – just a few months after it announced its intention to build a new nuclear reactor at Lucas Heights in southern Sydney. The two plans were closely linked. Up to 90% of the waste to be dumped in SA is stored at Lucas Heights. And the political agenda was simply to get radioactive waste out of Lucas Heights in order to reduce public opposition to the new reactor.
A campaign to oppose the dump took shape. The Kupa Piti Kungka Tjuta – a senior Aboriginal women’s council from northern SA – took up the fight, as did the Kokatha traditional owners. The Kungkas – victims of the British nuclear testing program at Maralinga and Emu Field in the 1950s – have been supported by the GANG (Girls Against Nuclear Genocide) who have moved to Coober Pedy to help fight the proposed nuclear dump.
The Kungka Tjuta recounted time and again their experiences of the Maralinga nuclear test program in South Australia in the 1950s. They knew first hand about the problems of the nuclear industry and pleaded with the politicians to ‘get their ears out of their pockets’.
The Maralinga experience also influenced the dump campaign in another way. The federal government completed a ‘clean-up’ of Maralinga in the late 1990s, but it was grossly inadequate. Even after the ‘clean-up’, kilograms of plutonium remain buried in shallow, unlined trenches in totally unsuitable geology. The botched ‘clean-up’ was hardly reassuring.
The federal government planned to build two facilities at Woomera – an underground dump for lower-level waste, and an above-ground store for ‘interim’ storage of higher-level wastes including those arising from the reprocessing of spent nuclear fuel rods from the Lucas Heights reactor. As public and media opposition to the dump plans grew, the Olsen Liberal government in SA sniffed the political wind and announced in 1999 that it would accept the underground dump but would legislate in an attempt to ban the higher-level waste store. The Labor Party – state and federal – trumped them by announcing opposition to both the dump and the store.
Several environment groups have fought the dump plan since it was first announced, including Friends of the Earth and the Australian Conservation Foundation. Opposition to the dump grew along the transport corridor linking Lucas Heights to Woomera, in no small part because of Friends of the Earth’s Nuclear Freeways project. On numerous occasions FoE activists took a mock nuclear waste castor along the transport corridor, building relations with communities all the time. This project was highly successful. Of the 18 councils along the transport corridor, 16 took a position of opposing the dump and the trucking of radioactive waste through their communities. FoE also organised numerous ‘radioactive exposure’ tours, taking hundreds of students to nuclear sites in SA – the proposed dump site and the uranium mines at Honeymoon, Beverley and Roxby Downs.
The Nuclear Freeways project was also significant in linking the dump proposal to the root of the problem – the planned new reactor at Lucas Heights. While the federal government mounted scare campaigns about waste stored in urban areas, it became increasingly well known that the dump plan had nothing to do with the small volumes of waste stored around the country and the everything to do with Lucas Heights. The NSW government was persuaded to hold a parliamentary inquiry into radioactive waste management in 2003-04, and that inquiry concluded that the dump proposal could not be justified and should be abandoned.
The Labor Party won the 2002 election in SA, and in the following year it legislated in an attempt to ban any form of national radioactive waste facility being built in SA.
The SA Labor government also tried a legal manoeuvre to stop the dump in 2003 – announcing its intention to declare the dump site a public park, which would make it immune from compulsory acquisition by the federal government. That led the federal government to use an urgency provision in the land acquisition act to seize control of the dump site with the stroke of a pen in mid-2003. The SA Labor government challenged the land seizure in the federal court, but lost. The SA government appealed the judgement to the full bench of the Federal Court, and that appeal was upheld in June 2004 – reversing the land seizure.
By July 2004, the Howard government was in trouble. It had the option of appealing the Federal Court decision to the High Court, but that appeal would have been deeply unpopular and it probably would not have succeeded in any case. And already, the dump was shaping up as a key issue in marginal seats in SA. For example, in the marginal seat of Adelaide, polling showed that the dump was second only to Medicare as a vote-swinging issue.
The Howard government decided to cut its losses and abandon the dump plan. The government said it would instead attempt to find a site to co-locate both lower and higher level wastes.
The victory of the dump campaign is something to savour – a fantastic result reflecting an enormous amount of hard work by a broad, effective alliance.
The Kupa Piti Kungka Tjuta’s ‘Irati Wanti’ website is archived at
‘We are winners because of what’s in our hearts, not what’s on paper.’
Open Letter from the Kupa Piti Kungka Tjuta – senior Aboriginal women’s council from northern SA – after the Federal Government abandoned its plan to build a national radioactive waste dump in South Australia.
People said that you can’t win against the Government. Just a few women. We just kept talking and telling them to get their ears out of their pockets and listen. We never said we were going to give up. Government has big money to buy their way out but we never gave up. We told Howard you should look after us, not try and kill us. Straight out. We always talk straight out. In the end he didn’t have the power, we did. He only had money, but money doesn’t win.
Happy now – Kungka winners. We are winners because of what’s in our hearts, not what’s on paper. About the country, bush tucker, bush medicine and Inma (traditional songs and dances). Big happiness that we won against the Government. Victorious. And the family and all the grandchildren are so happy because we fought the whole way. And we were going away all the time. Kids growing up, babies have been born since we started. And still we have family coming. All learning about our fight.
We started talking strong against the dump a long time ago, in 1998 with Sister Michelle. We thought we would get the Greenies to help us. Greenies care for the same thing. Fight for the same thing. Against the poison.
Since then we been everywhere talking about the poison. Canberra, Sydney, Lucas Heights, Melbourne, Adelaide, Silverton, Port Augusta, Roxby Downs, Lake Eyre. We did it the hard way. Always camping out in the cold. Travelling all over with no money. Just enough for cool drink along the way. We went through it. Survivors. Even had an accident where we hit a bullock one night on the way to Roxby Downs. We even went to Lucas Heights Reactor. It’s a dangerous place, but we went in boldly to see where they were making the poison – the radiation. Seven women, seven sisters, we went in.
We lost our friends. Never mind we lost our loved ones. We never give up. Been through too much. Too much hard business and still keep going. Sorry business all the time. Fought through every hard thing along the way. People trying to scare us from fighting, it was hard work, but we never stopped. When we were going to Sydney people say “You Kungkas cranky they might bomb you”, but we kept going. People were telling us that the Whitefellas were pushing us, but no everything was coming from the heart, from us.
We showed that Greenies and Anangu can work together. Greenies could come and live here in Coober Pedy and work together to stop the dump. Kungkas showed the Greenies about the country and the culture. Our Greenie girls are the best in Australia. We give them all the love from our hearts. Family you know. Working together – that’s family. Big thank you to them especially. We can’t write. They help us with the letters, the writing, the computers, helped tell the world.
Thank you very much for helping us over the years, for everything. Thank you to the Lord, all our family and friends, the Coober Pedy community, Umoona Aged Care, the South Australian Government and all our friends around Australia and overseas. You helped us and you helped the kids. We are happy. We can have a break now. We want to have a rest and go on with other things now. Sit around the campfire and have a yarn. We don’t have to talk about the dump anymore, and get up and go all the time. Now we can go out together and camp out and pick bush medicine and bush tucker. And take the grandchildren out.
We were crying for the little ones and the ones still coming. With all the help – we won. Thank you all very much.
No Radioactive Waste Dump in our Ngura – In our Country!
MEDIA RELEASE – 15 DECEMBER 2009
FRIENDS OF THE EARTH, AUSTRALIA
NUCLEAR DISARMAMENT REPORT MASKS A HIDDEN AGENDA
Friends of the Earth today questioned the credibility of the Australian-led International Commission on Nuclear Non-proliferation and Disarmament (ICNND), which has today released its first report, ‘Eliminating Nuclear Threats’.
Friends of the Earth’s national nuclear campaigner Dr Jim Green said: “The report makes repeated reference to the three S’s – safeguards, security and safety. It makes no reference to the dollar signs that constitute a hidden agenda to the Commission’s work including avoiding making any recommendations which would in any way jeopardise the Australian uranium export industry – an industry which accounts for a paltry one-third of one percent of Australia’s export revenue. The report trivialises the proliferation risks associated with nuclear power programs even though daily news coverage of the programs in Iran and North Korea provide a constant reminder of the risks.
“Co-chaired by Australian Gareth Evans and Yoriko Kawaguchi from Japan, the Commission is silent about Japan’s grossly irresponsible stockpiling of plutonium, the regional tensions arising from Japan’s plutonium program, and Australia’s complicity in Japan’s plutonium stockpiling.
“The report advocates new technologies ‘to avoid current forms of reprocessing altogether’ – so why not take immediate steps to reduce the risks of reprocessing and plutonium stockpiling rather than awaiting the development of new technologies? Kevin Rudd could announce tomorrow that he will no longer allow reprocessing of spent nuclear fuel produced from Australian uranium. Instead he waffles on about the fracturing of the global nuclear non-proliferation regime while doing nothing to address the problems.
“The ICNND got off to a bad start by giving the Australian Safeguards and Non-proliferation Office (ASNO) an advisory role. ASNO has a long track record of dishonest and unprofessional behaviour. Last year, ASNO misled the Joint Standing Committee on Treaties with false claims that safeguards would ensure peaceful use of Australian uranium in Russia – even though there hasn’t been a single IAEA inspection in Russia since 2001. Other ASNO lies include its claims that nuclear power does not present a weapons proliferation risk, that Australia sells uranium only to countries with ‘impeccable’ non-proliferation credentials, and that all Australian uranium is ‘fully accounted for’.
“If the Commission was serious about non-proliferation and disarmament, it would have recommended that:
* Australia and Japan both immediately renounce their reliance on the ‘extended deterrence’ of the US nuclear weapons ‘umbrella’ and take practical steps commensurate with that policy shift, e.g. prohibiting visits of US nuclear warships.
* Uranium exports should be prohibited to: countries in breach of their NPT disarmament obligations, including the five ‘declared’ weapons states; non-NPT countries including India; countries blocking progress on the Comprehensive Test Ban Treaty and the proposed Fissile Material Cut-off Treaty; and countries stockpiling plutonium, including Japan.
Dr Green concluded: “The Commission should have taken heed of the statements of physicist Victor Gilinsky, a former member of the US Nuclear Regulatory Commission, in the Bulletin of the Atomic Scientists earlier this year. Gilinsky said: ‘We should support as much nuclear power as is consistent with international security; not as much security as the spread of nuclear power will allow.'”
World Water Day on March 22 encouraged widespread reflection on worsening water depletion and pollution problems around the world. As the driest state in the driest
continent, South Australia is the canary in the coal mine. But while many South
Australians are pulling their weight by reducing water consumption and
installing rainwater tanks, some industries are pulling in the opposite
direction.
The
uranium mining industry is perhaps the most egregious example. The daily
extraction of about 35 million litres of Great Artesian Basin water for the
Olympic Dam uranium/copper mine has adversely affected a number of precious
Mound Springs – unique habitats which support rare and delicate micro flora and
fauna, some species of which are unique to a particular Mound Spring.
BHP
Billiton pays nothing for its massive water take for the Olympic Dam mine
despite recording a $17.7 billion profit in 2007-08. That arrangement is
enshrined in the Roxby Downs Indenture Act 1982 – as anachronistic a piece of
legislation as you’re ever likely to see.
In
February 2007, then Prime Minister John Howard wrote to state Premiers seeking
their agreement "to establish proper entitlements, metering, pricing and
reporting arrangements for water extracted from the Great Artesian Basin."
Asked whether his proposed new arrangements would apply to Olympic Dam, Mr
Howard said: "Everybody’s got to make a contribution to solving this
problem." But within days, he voiced support for BHP Billiton’s
"right" to free water from the Artesian Basin. In other words,
everyone except BHP Billiton has to make a contribution to solving this problem.
As The Advertiser noted in a November
2005 Editorial, it is “essential … to safeguard the artesian basin water
supplies”. To that end, most users are subject to the Great Artesian Basin
Management Plan. But BHP Billiton is a law unto itself – its Olympic Dam mine is
not subject to the Management Plan and also enjoys exemptions from the SA Natural
Resources Act 2004 and the Environment Protection Act 1993.
Another
problem at Olympic Dam concerns the liquid tailings dams which are constantly
expanding as water is turned into liquid waste. In 2005 it was revealed that over
100 bird deaths were recorded in a four-day period – the birds had drunk liquid
tailings waste from the mine. Ongoing seepage from tailings dams are a further
concern. Last Monday (March 23), photos taken by an Olympic Dam mine worker
were released clearly showing radioactive
tailings liquid leaking from the
so-called rock ‘armoury’ of a tailings dam. The leaks were ongoing for at least
eight months and probably amounted to several million litres, but were not
publicly reported at all. Serious questions must be raised as to BHP Billiton’s
capacity to safely manage radioactive tailings if, as planned, tailings
production increases seven-fold to 70 million tonnes annually and water
consumption increases to over 150 million litres daily (over 100,000 litres
every minute).
BHP
Billiton proposes continuing with its water take from the Artesian Basin and
also building a desalination plant in the Upper Spencer Gulf to provide an
additional 120 million litres daily. The proposed desalination plant has raised
concerns over its impacts on marine species and fishing industries – in
particular from the discharge of brine. The Upper Spencer Gulf is a low
flushing fragile marine environment unsuited to siting a desalination plant and
BHP Billiton’s preferred site at Port Bonython is the breeding ground of the Charismatic
Giant Australian Cuttle Fish.
In-situ
leach (ISL) uranium mining is used at the Beverley uranium mine and is the
mining method proposed for use at other SA mines including Oban, Beverley Four
Mile and Honeymoon. ISL involves pumping acid into an aquifer, dissolving the
uranium ore and other heavy metals and pumping the solution back to the
surface. After separating the uranium, liquid radioactive waste – containing
radioactive particles, heavy metals and acid – is simply dumped in groundwater.
From being inert and immobile in the ore body, the radionuclides and heavy
metals are now bioavailable and mobile in the aquifer.
Proponents
of ISL mining claim that ‘attenuation’ will occur over time – that the groundwater
will return to its pre-mining state. However there is considerable scientific
uncertainty about the future of ISL-polluted groundwater and uncertainty about
the timeframe for attenuation if it does occur. A 2003 Senate References and
Legislation Committee report recommended banning the discharge of radioactive
liquid mine waste to groundwater. The Rann Government responded by
commissioning a study which had all the hallmarks of a whitewash yet still
acknowledged that attenuation is "not proven" and could only cite a
period of "several years to decades" for it to occur. Yet the
companies proposing to use ISL mining at Beverley Four Mile want to absolve
themselves of any future responsibility for the site just seven years after
they have finished mining. The future of ISL mining is plain to see –
short-lived mines leaving South Australians with a lasting legacy of polluted
aquifers.
The
Australian Nuclear Free Alliance – which brings together Aboriginal custodians
with representatives from environmental, medical and public health groups – is
calling on the Rann Government to initiate an independent public inquiry into
the impacts of uranium mining on SA’s water resources. This inquiry ought to
take place in the 12 months leading up to next year’s state election. It would
provide political parties with an opportunity to demonstrate their resolve to
properly regulate the state’s dwindling water resources and to address the
contradiction between corporate water profligacy and the responsible attitude
and actions of ordinary South Australians.
Dr Jim Green is Friends of
the Earth’s national nuclear campaigner and a member of the Australian Nuclear
Free Alliance’s national committee.
June
2004 marks the fifth anniversary of PR company Michel Warren’s involvement in
the federal government’s plan to establish a national nuclear waste dump in
South Australia. A great deal of information is now available about the role of
Michels Warren in this controversy thanks to documents released under Freedom
of Information (FoI) legislation.
Parts
of the FoI material were discussed in a media release from the SA environment
minister John Hill on May 5, 2004 (included below), but a closer reading of the
FoI documents reveals much else of interest – including proof that federal
science minister Peter McGauran has misled the Parliament.
Misleading
statements by the federal government
While
this paper focusses on the role of Michels Warren, it should be noted that the
FoI material reveals evidence of the federal government misleading the Parliament
and the public.
The
FoI material reveals that the dump could be 25 times larger than the government
has ever publicly acknowledged. A February 10, 2000 email from a senior
government official, Rosemary Marcon, says that the “actual disposal area is a
500mx500m” (250,000 square metres) and she repeats that statement in a March
22, 2000 email. Yet public statements from the government refer to a 100mx100m
disposal area – 10,000 square metres (e.g. Environmental Impact Statement,
p.11.) Had the reference to a much larger dump been made once, and/or had it
been made by a junior official, it might be passed over as an error. But the
statement is made twice, and it is made by a senior government official.
In
response to a Question on Notice, federal science minister Peter McGauran
asserted unequivocally that departmental officers had not developed a list of
‘experts’ to make public comments in support of the proposed nuclear waste
dump. (Senate Hansard, October 27, 2003, p.16471, Question No. 2134, full text
copied below.) However, the FoI material makes it clear that such a list was
indeed developed. A July 6, 2000 email from Caroline Perkins, a senior
government official, lists four “technical experts … who have agreed to
assisting us in general”, though their names are blanked out. McGauran’s
unequivocal assertion that departmental officers had not developed a list of
‘experts’ to comment on the dump was clearly false – and he was clearly
misleading the Parliament and the public.
A
2002 government document released under FoI legislation (and previously
leaked), titled “Communication Strategy for the National Radioactive Waste
Repository Project”, states that: “An Adelaide based communications consultant,
Michels Warren, has been subcontracted … to assist with the development,
implementation and refinement of this strategy which has entailed the
following: … enlistment of a scientific liaison officer and other willing
experts”.
A
2003 document written by Michels Warren discusses plans to organise eminent
Australians and members of South Australian medical and science community to
participate in the ‘communications’ program. Michels Warren states: “This would
involve a concerted program of letters to the editor of The Advertiser and
responding and participating on talk radio programs.”
The
government and Michels Warren seem to have struggled to find “willing experts”.
For example, Mike Duggan from Michels Warren said in a July 6, 2000 email that
it would be a “great idea” to gather experts for a media conference, “if
possible at one of the universities or hospitals where waste is held”, in
support of the dump – but no such media conference eventuated.
Those
‘experts’ that have been enlisted have been error-prone. For example, the FoI
material contains a summary of a May 2000 radio interview with Dr Leon Mitchell
of Flinders University, who falsely claimed the dump would be lined with an
impermeable layer to isolate it from the underlying earth (the dump trenches
will be unlined). Mitchells also said the dump was for things such as watch
dials not nuclear power plants and reactors. In fact, dismantled nuclear
reactor components will be sent to the dump (if it proceeds), and that reactor
waste will amount to up to 5,000 cubic metres, which is greater than the entire
existing stockpile of 3,700 cubic metres of waste destined for the dump.
Michels Warren was involved in organising radio interviews with Mitchell, the
FoI material reveals. Other enlisted ‘experts’ have falsely claimed that the
dump is only for low-level waste, and one ‘expert’ even claimed that the waste
would not be buried!
McGauran
misled Parliament on another point. He asserted unequivocally in a response to
a Question on Notice that no ‘experts’ were provided with media training by
consultants to the department. The FoI material reveals that McGauran’s claim
was false. On July 12, 2000, Michels Warren charged the government $240 to
provide a written briefing to one of the enlisted ‘experts’, Dr. Gerald
Laurence, in preparation for media interviews. On July 7, 2000, Michels Warren
briefed another enlisted ‘expert’, Dr. John Patterson, for a radio interview.
Then on July 12-13, 2000, Michels Warren billed the federal government $800 for
media training with the government’s scientific liaison officer on the dump
project, Dr. Keith Lokan.
Why
Michels Warren would be conducting briefings about the dump is anyone’s guess.
The FoI material is replete with factual errors. For example, a draft letter to
a newspaper, states: “Unequivocally, it [the dump] will only ever contain
low-level waste.” Yet the dump will take both low- and intermediate-level
waste, including (according to the EIS, pp.45-46) long-lived intermediate-level
waste. The draft letter also states that “Australia produces no high-level waste
…” Yet the Australian Nuclear Science and Technology Organisation, operator
of the reactor at Lucas Heights in Sydney, acknowledges that its spent nuclear
fuel meets the heat and radiological criteria for classification as high-level
waste, and the New South Wales Environment Protection Agency has also
acknowledged that the Lucas Heights reactor generates high-level waste.
The
context for the “willing experts” strategy is made clear in the FoI documents.
Market research by the McGregor Tan company revealed: “A knee-jerk negative
reaction to sighting the Commonwealth crest – it is interpreted as the symbol
accompanying government propaganda.” The market research also revealed:
“Cynical responses to government promises and attempts at reassurance.” And McGregor
Tan found that: “Ministers’ statements are rarely believed, regardless of the
individual Minister’s honourable intentions.”
Michels
Warren’s nuclear dump PRopaganda
Michels
Warren has been involved in the following campaigns (among others): a controversy
over cadmium at West Lakes, Bridgestone tyres, bacteria in fast food, SA Water
contamination, ETSA Utilities, the SA Freemasons, Telstra, WMC Ltd., and
campaigns on behalf of the corporate owners of the Beverley and Honeymoon
uranium mines in South Australia.
Michels
Warren has been involved in the nuclear dump campaign since June 1999. Its
involvement has consisted of several discrete contracts rather than an ongoing
involvement. A July 8, 1999 letter from Stephen Middleton from Michels Warren
states that the company is “delighted to be part of the project” and has “hit
the ground running” since it started on the project in the previous month.
Michels Warren has maintained its enthusiasm. A 2003 document – a tender
seeking involvement in the federal government’s covert plan to seize control of
land for the dump site – states that: “We are available 24-hours-a-day,
seven-days-a-week to provide our support to the Minister and this project.”
A
September 27, 2000 email written by Stephen Middleton from Michels Warren talks
about the need to “soften up the community” and “sell” the repository: “We will
lose ground once again unless we can soften up the community on the need for
the repository and the reasons why SA has been identified as the best location.
The prospect of the Minister announcing the preferred site before we can get to
the community with something that explains what it all means makes my head
spin. The wider research into issues such as Lucas Heights, uranium mining, the
nuclear fuel cycle etc etc can be tackled as a separate issue. It should not
hold up anything we are doing in terms of selling the repository to South
Australians. The rest of the country probably doesn’t care less about the
repository, but it is a big issue in SA. Further delays could be potentially
disastrous.”
Why
on earth is a South Australian company willingly involving itself in the
federal government’s nuclear dump plans? After all, Michels Warren itself
acknowledges that the dump is an unwanted imposition on SA. A 2003 Michels
Warren document released under FoI legislation states:
“The
National Repository could never be sold as “good news” to South Australians.
There are few, if any, tangible benefits such as jobs, investment or improved
infrastructure. Its merits to South Australians, at the most, are intangible
and the range and complexity of issues make them difficult to communicate.”
So
why is Michels Warren dumping on its home state? Money, of course. The federal
government has acknowledged making the following payments to Michels Warren (in
response to a Question on Notice from Senator Bob Brown – copied in full
below):
*
$359,000 in financial years 2000-01, 2001-02, 2002-03 (Senate Hansard, October
27, 2003, p.16471 – copied in full below).
*
in 2003, Michels Warren and the federal government signed a $107,000 contract
for work connected to the government’s compulsory seizure of land for the dump.
At least $26,000 of that amount was paid (and quite possibly the entire
$107,000).
*
undisclosed payments to Michels Warren in 1999-2000.
The
1999-2000 payments amount to at least $102,000 up to May 31, 2000, according to
a document included in the FoI material (Progress Payment Certificate, Number
12, August 24, 2000).
So
in total, Michels Warren has been paid at least $487,000 to dump on SA … and
possibly much more.
Michels
Warren staff have been paid at rates up to $192.50 per hour (GST inclusive) for
their work on the nuclear dump campaign.
The
detailed breakdowns of payments to Michels Warren raise further concerns about
whether tax-payers are getting value for money. For example:
*
$160 to draft a letter to editor of Mt Barker Times
*
$894 for Michels Warren employees to attend a public meeting organised by the
Australian Conservation Foundation and for preparatory and debriefing work
surrounding the meeting (a full house at the Adelaide Town Hall, with
approximately 1000 people attending).
*
$225 to draft a letter to a constituent.
*
$240 to schedule talk-back radio interviews.
Michels
Warren is not the only company in receipt of government funding for PR and
research in relation to the nuclear waste dump, e.g.
*
$61,369 paid to Worthington Di Marzio in 2003 for market research. (Senate
Hansard, October 29, 2003, pp.16681-2, Question No. 2139.)
*
$72,000 paid to Hill & Knowlton in 2002-03. (Senate Hansard, October 27,
2003, p.16471, Question No. 2136.) Hill & Knowlton is well known for its
involvement in the imaginative ‘babies in the incubator’ fiasco in Iraq in
1990-91, and for its work with tobacco companies, Enron, etc.
Monitoring
protesters
An
August 16, 2000 “high priority” email reveals that Caroline Perkins, a senior
official in the Department of Industry, Science and Resources – at that time
under the direction of Senator Nick Minchin – was asked to compile information
on protesters. "[T[he minister wants a short biography of our main
opponents in the Ivy campaign by about 11am our time (pre-rally)”, the email
said. The rest of the email is blacked out under FoI provisions. The email refers
to a Michels Warren employee – no doubt Michels Warren helped compile the
biographies.
In
1999 Michels Warren was working hard “obviating the impact of campaigns by
opponents and the ‘I’m With Ivy Campaign’ run by Ch 7.”
The
Michels Warren worksheet for February 2000 includes the following: “Liaise
investigator re green planning. Liaise R Yeeles [from WMC Ltd.] re updated
intelligence.” Was Michels Warren employing a private investigator as that
comment suggests?
And
on March 28, 2000, $150 for activities concerned with a “Protest at South
Australian Parliament”, and $160 four days earlier to “Liaise WMC, Police and
media re weekend protests.”
And
in April 2000: “check re new protest activities”, “liaise SA Police re same”,
“internet search re protests”, and “update intelligence re OHMS Not Boms
protest group”.
In
March 2000, Rosemary Marcon, a government official, asked Michels Warren for
the details of an “activist website
which we should monitor”. She was advised by Michels Warren that the site is
<www.lockon.org>. Evidently that piece of ‘intelligence’ was off-beam –
the website advertises streaming live shows from nude male dancers in Montreal!
The
FoI documentation is frequently contemptuous of opponents of the planned
nuclear waste dump (about 80% of the South Australian population). The option
of displaying the Environmental Impact Statement in the Conservation Centre of
South Australia is treated as a joke. Opponents of the dump are described as
“anti-nuclear anarchists”. Michels Warren co-founder Daryl Warren refers in a
July 14, 2003 email to protests and “demons”. On July 10, 2003, Warren stated
that: “It has become apparent during the week that people seem to have lost the
plot on the repository as it becomes embroiled in a political fight.”
In
response to an invitation to the federal science minister to attend a
conference at Adelaide University in March 2000, Michel’s Warren employee
Stephen Middleton recommends against attending the conference. Middleton wrote:
“The better option is to:
(i)
dismiss the gathering as nothing more than a stunt
(ii)
attempt to discredit it with counter media measures before, during and after.”
Doctoring
photos
The
FoI material suggests that photographs have been doctored to suit the
government’s ends. A February 14, 2000 email from a senior government official
to Michels Warren’s graphic designer refers to a photo “with the sandhills
removed.” The rationale was explained in a December 13, 1999 email by the same
government official: “Dunes are a sensitive area with respect to Aboriginal
Heritage.”
The
February, 2000 email also asked: “Can the horizon be straightened up as well.”
Scare
campaign
A
recurring theme in the exchanges between the federal government and Michels
Warren is the attempt to justify the dump by mounting a scare-campaign in
relation to existing storage facilities. Yet they get their lines muddled up.
One document released under FoI includes that statement that “none” of the
waste “is stored satisfactorily” in existing stores. That is in direct
contradiction to a June 2000 document document under Senator Nick Minchin’s
name (“Radioactive waste: the eight biggest myths”), which states: “The safety
of the storage of radioactive waste is proven by the fact that there are fifty
stores around Australia housing radioactive waste and there has never been an
accident exposing a person to unsafe levels of radiation.”
And
in a May 17, 2000 media release, Minchin said: "South Australians have
nothing to fear from radioactive waste. The fact is that waste is already
stored in downtown Adelaide in complete safety." Anyone claiming otherwise
was merely trying to "whip up anti-radioactive waste hysteria",
Minchin claimed. So by his logic, Michels Warren and the federal government
itself are guilty of trying to whip up hysteria.