– “the small reactors used to power them do produce weapons-grade uranium as waste. And it’s the ability to produce weapons-grade uranium that is behind the decades-long nonproliferation dispute over Iran’s nuclear program.”
Both statements are nonsense; see below the dotted line.
What the Chinese government is really worried about is this map:
https://www.moonofalabama.org/11i/aussubmap.jpg
China is out of range of conventional subs from Australia, but very much within range of nuclear powered subs. And China will only have Australia’s word that these Australian subs won’t have US or UK nuclear weapons on board.
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Physics:
Reactors produce “spent fuel”, a horrible, highly radioactive mixture of some of the original fuel (U235 and U238), fission products (radioactive isotopes of strontium, caesium, iodine etc, the same as fallout from a nuclear bomb), plutonium, and other ‘actinides’, which are radioactive elements with higher atomic number than uranium.
The plutonium can be used to make nuclear bombs, but (1) it needs complicated reprocessing facilities to separate out the plutonium, and (2) it can only make A-bombs, not the far more powerful H-bombs. You need to make tritium as well to make H-bombs.
I think what the clueless author means (couldn’t he have just asked someone?) is that the Chinese government is concerned because the fuel elements for these subs will be uranium of fairly high enrichment; 60% U235 with 40% U238 – whereas civilian reactor fuel elements are only 5% U235. But you can’t make bombs with 60% U235 either; you need 95% U235 for bombs.
It is quicker and less staggeringly expensive to make 95% U235 from 60% U235 than 5% U235, but a complicated and costly enrichment facility is still needed – either a centrifuge cascade or a gas diffusion facility. Australia has neither of these, and it would be blindingly obvious if it started building one. The same goes for a reprocessing facility, for extracting plutonium from spent fuel.
The only thing about these subs that makes it easier for Australia to get nuclear weapons is that they could sail to other countries and collect them.
Iran:
According to US intelligence agencies, in 2003 I think, Iran had stopped attempting to develop nuclear weapons some years earlier; Iran is fully open to IAEA inspections. The “decades-long dispute” is basically driven by Israel, objecting to Iran enriching to 20% U235 for its research reactor which can produce medical and industrial isotopes. But these days Russia does Iran’s uranium enrichment anyway.