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Australia out in the cold on uranium for energy pact

Australia could be missing out on uranium-fuelled prosperity as other advanced economies pour billions of dollars into their supply chains.

Raising concerns about no involvement in a new international pact on uranium, coalition senator Susan McDonald said Australia should support its use for energy generation.

Despite having the world's largest reserves, Australia could end up exporting uranium to another nation which then benefits from a supply chain agreement with the United States, she told the senate economics committee on Thursday.

Senator Susan McDonald (file image)
Senator Susan McDonald is concerned Australia is not making the most of its uranium supplies. (Lukas Coch/AAP PHOTOS)

A strategic partnership of the US, the United Kingdom, Canada, France, and Japan has so far mobilised more than $US4.2 billion ($A6.3 billion) in government-led investment to establish a secure global uranium market to replace Russian supplies.

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Australia may hold the world's largest reserves, but Russia has 44 per cent of the world's uranium enrichment capacity and has supplied more than one third (35 per cent) of US imports for its nuclear reactors, according to US data.

However, the US recently passed an act that prohibits Russian uranium imports for US reactors, and intends to rapidly expand its domestic uranium enrichment and conversion capacity.

Senator McDonald said it would make sense to be involved in their "zero-emissions nuclear energy system", given Australia's deep ties with the Americans on defence and critical minerals.

"I am concerned that the US is providing a significant amount of money for supply chains for uranium and I'm interested in how Australia accesses that, given that we're not party to those agreements," she said.

Department of Industry Sciences and Resources secretary Meghan Quinn said officials were forecasting an increase in Australian uranium exports in coming years, reflecting increasing demand internationally.

"Our primary exports are to the United States, France and Canada, so their work on managing increased demand would clearly be an opportunity for our existing exporters to increase their production," she told the budget estimates hearing.

Ms Quinn said she expected an increase in production out of Australia's existing three uranium mines over the next few years.

"Beyond that, it would be a matter for proponents and regulation to be able to accommodate (expansion or new mines)," she said.

Senator Tim Ayres, representing Resources Minister Madeleine King, said there were "fast-moving developments" in industry measures by trading partners and in trade arrangements.

The Department of Foreign Affairs and Trade was focused on all of those questions, he said.