Nuclear politics: taking the A train

APEC leaders ate Sydney seafood and drank Grange in early September, taking in views of the harbour from the Opera House, while behind them, downtown was barricaded as never before. Small businesses complained about losing money but local madams reported enthusiastic trade. Some of Sydney’s police became badgeless and took their irritation out on a few demonstrators and a press photographer.

As was predicted by columnist Peter Hartcher in The Diplomat, nothing earthshaking, region-transforming, or climate-changing happened during APEC. But quietly, during the summit, Australia agreed to sign on to George Bush’s Global Nuclear Energy Partnership (GNEP), and to sell uranium to Russia.

GNEP claims that it will “accelerate clean and safe nuclear energy”. A select bunch of nuclear weapons states - plus non-nuclear Japan and Australia - went to Vienna after APEC and signed up to GNEP. Their aim - or their pious hope - is to control the distribution and reprocessing of nuclear fuel in the world. But it’s when they get to the storage of waste that all eyes turn to Australia, whose official line is to allow the export of uranium, but not to import nuclear waste. In Vienna, Australia agreed to “expand nuclear power to help meet growing energy demand in a sustainable manner and in a way that provides for safe operations of nuclear power plants and management of wastes”.

No one in Sydney or Vienna mentioned a line of dots glowing in the dark. It starts from Lucas Heights (where, by the way, Australia’s only nuclear reactor has malfunctioned and been shut down for more than three months). It leads westward to Adelaide, then north to the Olympic Dam uranium mine, on through the desert past nuclear waste sites, military bases, and Aboriginal land, to the port of Darwin. The line completing the circuit and connecting the dots is the new north-south railway. Foreign Minister Alexander Downer calls speculation about a secret plan to import nuclear waste “wacky” - another good reason to look more closely at it.

Always considered uneconomic, the rail link from Alice Springs to Darwin was suddenly found to be viable in 1999. A government-business partnership undertook to build it for $1.3 billion. FreightLink, a consortium of foreign and local investors that owns the railway, with a 50-year contract to run its freight operations, is a joint venture between 11 participants including Kellogg Brown Root (KBR, 36.2 per cent), Barclay Mowlem (13.9 per cent), and John Holland (11.4 per cent).

The sole tender for construction of the line was KBR, a subsidiary of Halliburton, the US company that Dick Cheney headed before he became Vice-President. Cheney visited Australia in the late 90s to negotiate the deal with South Australian Premier John Olsen and Prime Minister John Howard. Defence contracts won by Halliburton and its affiliates were worth $2.5 million in 2000; that amount increased to $18 million in 2003; and in the following year they secured more than 150 State and Federal Government commissions.

Just after the railway line opened, a leader in the Australian freight business predicted that the railway’s return on capital would be “smaller than a tick’s testicles”. The company reportedly lost $17.7 million in its first half year (2004), $53.54 million in 2005, and a similar figure in 2006. To their initial $740 million, the stakeholders added $42 million, and later promised to invest an additional $14 million over three years.

In August 2007 FreightLink’s business was reported to have made “a slow start”. The company recorded its fourth annual loss in a row, having tried and failed a year earlier to sell a majority stake in the railway for $360 million.

The consortium transports iron ore from Frances Creek, manganese from Bootu Creek, and uranium from the Olympic Dam site at Roxby Downs. But there must be more to it than that - and investors’ hopes of transporting copper from Prominent Hill in 2008 - for them to remain interested.

The north-south railway passes between the largest uranium deposits in the world. In late 2006, just as Howard endorsed a report advocating nuclear power for Australia, a consortium of mining industry leaders announced their intention to build a nuclear power plant near Port Augusta, northwest of Adelaide. One of them, Howard admitted, had discussed it with him six months earlier. The railway would presumably be a vital link, carrying uranium ore to Darwin for export and processing overseas, and bringing it back to Port Augusta as nuclear fuel. The spent fuel could then either be transported to Darwin for export or carried south for disposal at a waste site in central Australia.

The International Atomic Energy Agency, which proposes to control the export and processing of uranium and disposal of waste through a multilateral arrangement, has identified sites in South Australia as geologically the best in the world for disposal of nuclear waste. But no state government will take it. Downer said he wouldn’t want it near his Adelaide electoral office. Having promised before the 2004 election that the Government would not dump waste in the Northern Territory, Howard declared in 2006 that he would override Territory law and use Commonwealth land there for nuclear waste if he wanted to.

In April this year he promised to amend his own law prohibiting “nuclear activity”, to allow for nuclear power, enrichment, and reprocessing of waste. He would also remove restraints on the mining and transportation of uranium ore. In June, the Federal Council of the Liberal Party endorsed the proposal for an international nuclear waste dump in Australia.