BHP Billiton, the world's biggest miner, plans to reactivate its Yeelirrie project in the Goldfields of Western Australia to mine uranium, after the newly elected government of the state lifted a six-year ban on uranium mining imposed by the previous labor government led by Geoff Gallo.

The Yeelirrie mine holds nearly 35,000 tonnes of uranium and is the second-biggest undeveloped uranium deposit after ERA's Jabiluka deposit in northern Australia.

''It is now open to the mining industry in this state, if they wish to proceed with plans to develop the uranium industry,'' the newly elected premier Colin Barnett said in a statement.

"BHP Billiton is assembling a project team, to be based in Perth, to evaluate mining and processing options and to assess the environmental impact," the miner said in a statement.

BHP, the second biggest uranium producer in Australia, has also another huge mining project, the Olympic Dam operation in South Australia, but it will take another 3-4 years for BHP to get uranium from its Yeelirrie project.

Olympic Dam holds the world's biggest recoverable uranium deposit, estimated at 2.3 million tonnes of recoverable uranium and BHP is investing around $20 billion in expansion activities to bring the production level to more than 19,000 tonnes.

BHP will have to talk to native Australians who are the traditional landowners, although the state government had divested them of the ownership title through a state agreement in 1978.

BHP had acquired the project through its acquisition of WMC Resources in 2005 for $9.2 billion and, according to a feasibility work done by WMC, it had projected the uranium reserves to be at around 35,000 tonnes and a 22-year mine life with annual production potential of 2,500 tonnes of uranium in the first 12 years, falling to 1,750 tonnes annually in subsequent years.

According to industry estimates, Australia has 24 per cent of the world's known recoverable uranium resources, but due to vehement opposition from state governments and green activists, most states had banned uranium mining, which is now being relaxed in a phased manner.

Because of the opposition, Australia has only three uranium operating mines at the moment and currently produces and exports just 20 per cent uranium to 36 countries that have signed the non-proliferation treaty, although there is a demand from China and now India.

The Australian government had initially refused to sell uranium to India as it was not a signatory to the non-proliferation treaty, even though it signed the Indo-US agreement to transfer nuclear technology and a separate nuclear safeguards agreement over the use of uranium. (See: Australia won't sell uranium to India, says Macfarlane)

It did change its stance later and Australian prime minister John Howard said his country may relax its ban from selling uranium to India. (See: Australia may relax ban on uranium sales to India)

Western Australia itself can produce 52,000 tonnes of uranium as it has 25 known deposits and could account for nearly 10 per cent of the world's known uranium reserves and the lifting of the ban could unlock tens-of-millions of dollars in royalty revenues, create jobs in Western Australia not to mention bringing a change in the fight against global warming.

Apart from BHP Billiton's Yeelirrie project, Mega Uranium's Lake Maitland project and Cameco's joint venture with Mitsubishi Development in Kintyre are the other major uranium mining projects in Western Australia. Yeelirrie and Kintyre together have around 150-million pounds of uranium in historic reserves alone.

Mitsubishi Development's Kintyre deposit is of high grade with about eight pounds of uranium per tonne of ore compared to an industry average of two or three.

In July, when the mining ban was in place, the Canadian miner Cameco decided to acquire a part of Kintyre uranium deposit in Western Australia at a throw away price of $346.5 million and, now, with the lifting of the ban, it is sitting on one of the world's most undeveloped project worth billions.

Environmentalists in Australia have condemned the state government's decision to lift the mining ban on uranium and say it will put West Australians at considerable risk and uranium is not just another mineral to be exploited for cash as there is no regulatory framework in place for transportation, storing the toxic waste of radioactive tailings which probably be buried in WA and the toxic legacy which will be carried on for generations.

Australian Nuclear Science and Technology (ANSTO) chairman Ziggy Switkowski has said that the more uranium Australia exports, the more nuclear power that's used around the world, the less the challenge becomes of the evolution away from fossil fuels.