Two companies push Uranium mining in region


Canadian competition

One major competitor for Colorado uranium could be back in business in a few years, Canada-based Cameco Corp. says.

Repair work on the Cigar Lake mine after a 2006 flood is two-thirds complete, Cameco said in a statement Dec. 18.

Cameco hopes to have the mine back in operation in 2012 or 2013.

The Cigar Lake mine contains proven and probable reserves of more than 226.3-million pounds of uranium oxide, the company said.

The uranium industry was born on the west end of Energy Alley, the run from Green River, Utah, to Rifle. It has burst into bloom and sputtered to obscurity more than once.

Like the half-lives by which radiation is judged to decay, though, the industry never has died. Two companies are burrowing into the red bluffs and canyons of western Colorado and eastern Utah to dig out uranium and start the process of generating electricity.

Although the history of the uranium industry in the region goes back to Madame Curie and her discoveries in the late 19th century, the supply is far from played out.

Miners dug out about 250 million pounds of uranium for the World II and Cold War efforts, said George Glasier, president and CEO of Energy Fuels Inc., a Canadian, publicly traded company.

“We got the easy stuff the first time,” Glasier said.

Now, determinations of how much uranium is available depend on its value.

“I believe there are 125 million pounds in this immediate area” that can be produced for $45 a pound, Glasier said. “If it goes to $100 (a pound,) we’ve got 300 million or 400 million.”

One estimate for a small portion of land in the Uravan Mineral Belt, 31 tracts, is the those lands being leased out by the U.S. Department of Energy contain 130 million pounds of uranium.

The United States now consumes about 50 million pounds of uranium oxide a year, said Glenn McGrath of the U.S. Energy Information Administration.

Though less optimistic about the size of the resource than Glasier, McGrath said the United States will have to turn more and more inward as it looks for secure sources of nuclear energy.

Several factors weigh in on the market value and importance of uranium that reaches the outside world via western Colorado’s Energy Alley.

Much of the uranium needed for the rods that now fire the plants has come from demilitarized uranium left over from the Cold War, said Jim Burnell, senior minerals geologist for the Colorado Geological Survey.

Two major international suppliers of uranium, meanwhile, are out of commission temporarily and possibly permanently. The Cigar Lake Mine in Canada flooded, and the Olympic Dam Mine in Australia is out of production because of a shaft accident.

“It’s a very real issue that we are fairly dependent on uranium from other sources than the United States,” McGrath said.

While issues such as national security and the availability of uranium factor into its value, there are other factors pushing nuclear power back to prominence.

Population growth, increasing demand for electricity to power a growing variety of devices, from refrigerators to computers, all are pushing up the need for electricity-generating fuel.

“Opinions vary regarding the future of nuclear power, but it is a fact that existing U.S. plants are performing well,” the U.S. Energy Information Administration says of nuclear power, noting nuclear power plants now operate at a 90 percent capacity factor, compared to 56 percent in 1980.

Fuel costs for nuclear fuel average less than one-half cent per kilowatt hour, well below the costs of major competing fossil fuels, the Energy Information Administration analysis said.

Production costs for nuclear power, operation and maintenance plus fuel costs, are also low, averaging 1.8 cents per kilowatt hour. That cost roughly matches coal and is significantly below the costs of operating a natural gas plant, the Energy Information Administration said.

Nuclear power now provides 20 percent of the United States’ electricity, a portion that is likely to increase as 30 nuclear plants that are under construction come online, according to federal estimates.

The U.S. Nuclear Regulatory Commission, meanwhile, is reviewing 13 combined applications for 22 more nuclear power plants.

It could take 50 years to produce the uranium lodged deep beneath the sandstone and sagebrush of the west end of the most important 150 miles, Glasier said, because the industry is limited by milling capacity.

Energy Fuels’ planned mill near Naturita and Denison Mines’ mill in Blanding, Utah, together will produce a combined 7 million to 10 million pounds a year, Glasier said.

Energy Fuels’s application to construct the mill was deemed complete in December, and officials with the Colorado Department of Public Health and Environment have begun the review process, which includes public meetings in the area. How quickly the uranium industry is sparked back to life will depend on a variety of factors, from the difficulty and cost of finding and milling it to demand for nuclear power.

There also are legal challenges the industry would have to overcome. Environmental groups have filed suit against Montrose County, alleging its land-use approval decision for the Energy Fuels mill was arbitrary. Other groups are challenging the Energy Department’s leasing program, questioning the potential effects of the mining on endangered species in the Colorado River Basin.

Some environmental groups, however, tend to favor nuclear energy because it doesn’t produce what are deemed greenhouse gases contributing to global warming.

“The bigger issue for uranium is: Will a significant portion of the world choose nuclear power as the clean fuel of choice?” said Dr. Rod Eggert, director of the division of economics and business at Colorado School of Mines. “Right now, there’s a lot of speculation, but exactly how large demand will grow, no one knows.”


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