170 Record by Irvine1 of AAEA Group Visit to Italy

Rome, 18 June 1971

Restricted

On Tuesday, 15th June, I accompanied Mr. M. Timbs and Mr. T. Alder2 on a visit to C.N.E.N.3 for discussions with Ing. Pantenetti4 and members of his staff.

  1. The discussions were mainly on technical matters although Mr. Timbs did give the Italians an idea of the amount and quality of known uranium reserves in Australia. One other aspect of the meeting was the hesitancy of the Italians to give exact production costs per unit for the production of electricity in Italy.
  2. This hesitancy was also apparent on the following day when Mr. Alder and Dr. Miles5 met Prof. Angelini6 at E.N.E.L.,7 although after some pressing Professor Angelini gave an approximate cost per unit which was almost three times as great as the cost of electricity produced in Australia (Australia's electricity average cost 3.5 US mils per kilowatt hour-Italy's approximately 9 US mils per kilowatt hour). Because Italy relies on imported oil to fuel almost half its electricity production and because the effects of the recent oil price rise were still unclear, the Italians said they were unable to give exact costs per unit.
  3. Alder and Miles (Timbs was not present) discussed with Prof. Angelini the possibilities and advantages of setting up a plant in Australia for nuclear enrichment. The Australian points were as follows:
    1. The cost per unit of production of electricity in Europe was very high since Europe relied greatly on imported oil to fuel its power stations. The European countries, therefore, must look to enriched uranium nuclear power stations which could produce cheaper electricity.
    2. However, the enrichment of uranium was a process requiring vast quantities of electricity and therefore Europe would lose all the cost advantages in having its own uranium enrichment plant. It was therefore in Europe's interest to import enriched uranium from countries which had cheaper electricity and could carry out the enrichment process more cheaply than it could be done in Europe.
    3. Australia, Canada and the USA were still in this position. Australia was an ideal site for a uranium enrichment industry because
      1. it could produce electricity cheaply as a result of its big, good quality coal resources,
      2. it had vast quantities of uranium, and
      3. since Canada and the USA could be expected to share nuclear technology and act more or less together in setting up uranium enrichment plants, it would be in Europe's interests to have another independent source of enriched uranium.
      Australia, for all the reasons outlined above, was the obvious source (transport costs on enriched uranium were minimal).
    4. However, while Australia had both uranium and cheap electricity, it lacked the technology and finance to set up enrichment plants and it would be necessary for it to be associated with European, and possibly Japanese, concerns if it wished to do so. Britain and France had, according to Mr Alder, already expressed some interest in this possibility
  4. Apparently, Alder and Miles discussed the same subject in Tokyo but, according to Alder, the Japanese Atomic Energy Commission released the information to the Japanese press, thus prompting the Australian Minister for National Development to issue press statements on the subject. (Canberra cable No. 1494.)8
  5. Prof. Angelini said that, naturally, Italy would also be interested in exploring the possibilities of this proposal (point iv). He mentioned, however, that Italy was not only looking to nuclear power for the future but was currently making preliminary studies on the feasibility of building power stations which could be fuelled either by coal or oil. They would need to import steaming coal (not coking coal) and there could be opportunities for Australian producers to export coal to Italy on long-term contracts.

[NAA: A1838, 720/4/9 part 2]