Uranium price keeps new projects on hold
Energy Fuels Inc. is fulfilling contracts for uranium at well above the current spot price, but it’s waiting with the rest of the industry to see that price nearly double before investing in new projects.
“Right now, we’re trying to hunker down a little bit and watch our pennies,” Curtis Moore, director of communications and legal affairs for Energy Fuels, said Wednesday.
Energy Fuels is fulfilling contracts with utilities for about $56 a pound, well over the current spot price of $40.90 a pound, according to U3O8.com.
“We’re pretty well shielded from spot prices” with the company’s contracts, Moore told the Grand Junction Area Chamber of Commerce energy briefing.
While the company is pursuing construction of the Pinyon Ridge uranium mill near Naturita, the price of uranium will likely have to clear the $70-per-pound threshold before construction begins, Moore said. That’s also the marker for reopening the eight mines the company owns on the Colorado Plateau, he said.
That could take some time.
“We see spot prices in the high 40s by the end of the year,” Moore said.
Once demand for uranium heats up, Energy Fuels will need the Pinyon Ridge mill when the company’s White Mesa mill in Blanding, Utah, can no longer keep up with demand, he said.
A decision is due this week from the Colorado Department of Public Health and Environment on Energy Fuels’ application for a radioactive materials-handling permit for Pinyon Ridge.
A Denver district judge had invalidated the permit and ordered the Department of Public Health and Environment to reconsider it after seeking public comment and a recommendation from an administrative law judge.
Energy Fuels is anticipating additional legal opposition to the Pinyon Ridge mill, Moore said.
It will cost about $150 million to construct the mill, he said.
Energy Fuels, which now bills itself as “America’s leading producer of conventional uranium,” now supplies about 1 million pounds of uranium oxide per year to utilities, or about a quarter of the 4 million pounds of domestic uranium used in the nation. In all, the United States uses about 50 million pounds of uranium per year to generate 20 percent of its electricity.