Worldwide Demand for Uranium Places Utah in Mining Mix Grand Junction, Colo. --
In western Colorado and eastern Utah, where salt wash deposits and sandstone hold uranium ore, there's a scramble on for mining claims, a demand for processing facilities and a clamor for miners.
The latest race for uranium yellowcake, spurred by plans for increased nuclear power across the globe, follows years when claim activity was nearly nil.
The 435 nuclear reactors in the world, including 104 in the United States, need 180 million pounds of uranium annually, but only 100 million pounds have been produced in recent years. China and India are leading a worldwide push for more nuclear power with ambitious plans for new power plants. President Bush wants to increase the 20 percent of U.S. power produced in nuclear plants.
With that growing demand, if no new supplies were mined, domestic uranium would run out in three years.
"No doubt about it, the world needs more uranium," said Tom Pool, chairman of International Nuclear Inc. in Golden, Colo.
More than 8,500 mining-claim permits have been filed in eight uranium-rich Colorado and Utah counties this year, according to records compiled by The Denver Post.
To meet the demand for even more claims to catch up to this nuclear need, the Department of Energy is preparing, for the first time since 1974, to put 13,600 acres of uranium-laced western Colorado lands up for bid next year.
Interest is focused on the Uravan mineral belt, a swath of western Colorado desert that holds a unique combination of the steel- hardener vanadium mingled with uranium.
Those rushing to file new claims or activate old ones include Canadian companies, which already control some of the richest uranium deposits in the world, domestic mining companies and families in western Colorado that have been chasing uranium and vanadium payoffs for generations.
"I see this boom not being a spike like in the early '90s. And I see it being more sustained than it was in the '70s and '80s," said Ed Cotter, the contract project manager for uranium leasing for the Department of Energy.
Despite the jostling to grab the 75 million pounds of uranium and 282,000 pounds of vanadium estimated to remain on the Colorado Plateau, this boom is not expected to be another willy-nilly and dangerous race to get as much uranium and vanadium out of the ground as quickly as possible.
"Companies are planning in a much more effective way for the future. They're making sure when you ramp up production, you ramp up carefully," said Stuart Sanderson, director of the Colorado Mining Association.
A number of factors -- increased permitting requirements and a lack of manpower and equipment -- won't allow a rush to uranium production.
Environmental and safety regulations have also moved into a new era -- with some projects needing approval from a dozen agencies -- since the last real uranium boom in the 1970s. And each mine start- up brings expensive bonding requirements to make sure cleanup is accomplished.
"It has to be done right this time," said Richard Dorman, vice- president of exploration for Universal Uranium Ltd. of Winnemucca, Nev. Dorman has worked through three uranium boom periods.
The new regulations and growth pressure explain why only four mines are operating in remote canyons in the west end of Colorado's Montrose County nearly two years after uranium and vanadium prices began to surge. Uranium now brings about $30 a pound and vanadium, about $19. That's up from $7 and $2 in 2001.
The Cotter Corp. owns the mines now operating in Colorado and is the country's only licensed mill taking newly mined ore. Cotter plans to open four more mines in Montrose and San Miguel counties by year's end. Three other mining companies with claims near the Colorado towns of Uravan and Gateway are inking agreements with Cotter to have ore processed at its Canon City mill.
Permitting and exploratory work is being done at dozens of other mines, but full-scale production is on hold while the Universal Uranium Corp. mill near Blanding, Utah, decides if it will accept new ore this fall.
Uranium mining projects planned around corporate boardrooms as well as rural kitchen tables are expected to move into high gear when more milling opportunities open up.
The Shumway family, which has been mining off and on in Utah for three generations, is anxious to get a fourth generation into it.
"Our kids are excited. They want to learn how to mine," said Deryl Shumway, who, with his brother Mitch, is preparing to reopen some of their leased parcels near Blanding.
The Shumways can rely on a network of relatives for employees, but companies are struggling to find miners.
The uranium industry has been mostly dormant since the 1980s, so nearly a generation of miners has been lost. Cotter has been luring miners from Nevada and Montana. A recent Cotter safety training class included a fireman, a truck driver and a mechanic. Some employees have been drawn from farms where the profits don't equal the average $70,000 to $80,000 annual wage miners earn.
As the nuclear industry heats up, it hasn't drawn a loud outcry from environmental groups, some say because the oil and gas boom pressing into more populated areas is drawing all the attention.
Jim Martin, executive director of Western Resource Advocates, said the potential for a resurgence in the nuclear industry needs a thoughtful response from environmentalists as well as a more controlled and responsible startup by the industry.
"At the moment we're agnostic on nuclear. We spend most of our time worrying about global warming," he said.
One of the overriding problems that remains to be dealt with since the last boom is where to put the waste. Colorado is riddled with 20,000 abandoned mines with potentially hazardous materials. And the spent fuel from nuclear reactors still needs a home. Plans to build an underground repository for such waste at Nevada's Yucca Mountain are stymied. No other new repositories are planned.
Source: Deseret News (Salt Lake City)
SMM Price at posting:
0.0¢ Sentiment: None Disclosure: Not Held
