Uranium Energy Corp (UEC)

[realfast95]

Ban of Russian uranium could revive local mine operations

http://www.buffalobulletin.com/news/article_88845a2c-508c-11ed-b189-03174a94bde9.html

Alex Hargrave Oct 20, 2022 Updated 4 hrs ago
Uranium Energy Corp., which acquired the Christensen and Irigaray Ranch uranium mines in Johnson and Campbell counties in its acquisition of Uranium One Americas in December 2021, is slowly preparing to restart operations.

That’s according to Donna Wichers, vice president of Wyoming Operations for UEC. Uranium is not yet priced high enough to start operations, but UEC appears confident that will happen soon. To sustain operations, the market price needs to jump to at least $60 per pound and stay there. Currently, that price sits around $48 per pound.

There’s no telling when that might happen exactly, but what needs to happen is clear, Wichers said.
advertisement

First, more nuclear reactors, which generate electricity using uranium, would increase demand for the resource. And if Congress opts to ban uranium imports from Russia, Wichers said, that would mean heavier reliance on a domestic product that doesn’t exist right now.

Wyoming’s congressional delegation has backed a bill that aims to do just that. Introduced in March, H.R. 7222, which is co-sponsored by Rep. Liz Cheney, would ban Russian imports of uranium.

Sen. John Barrasso introduced a companion bill in the Senate, cosponsored by Sen. Cynthia Lummis.

“It is absolutely imperative that we cut off all Russian imports, including uranium,” Lummis said in a press release. “Every dollar we send to Russia is a dollar used to continue to attack innocent people in Ukraine. Wyoming has more than enough uranium to fill this gap, and we can mine it in a more environmentally friendly and safe way.”

Both bills were introduced in both chambers, though no further action has been taken. Wichers, however, is hopeful, because reports say the White House may soon ban Russian aluminum imports in response to the country’s military escalation in Ukraine. This shows a willingness to ban Russian imports, which could eventually include uranium.

“Things like that will definitely help the market price,” Wichers said. “More utilities buying domestic, that’s what happens when they can’t get it from Russia, which is cheaper than to buy from domestic sources.”

According to the U.S. Energy Information Administration, the United States imports most of the uranium it uses as fuel. Owners and operators of U.S. nuclear power reactors purchased the equivalent of about 46.74 million pounds of uranium in 2021. Of that, just 5% was domestically produced. During that time, 35% of the uranium the country used was imported from Kazakhstan, 15% from Canada, 14% from each Russia and Australia, 7% from Namibia, and the final 10% was from five other countries.

In testimony to the Senate in March, Scott Melbye, president of the trade association Uranium Producers of America and executive vice president of Uranium Energy Corp., said that American uranium producers can’t compete with state-owned companies that use price undercutting tactics. Melbye specifically called out Russia for employing “predatory market practices to cultivate America’s dangerous reliance on the Kremlin and its allies for uranium and nuclear fuel.”Another factor that could spur domestic uranium production is the proposed national uranium reserve. The Department of Energy issued a request for bids for 2 million pounds of domestic uranium. UEC submitted a bid last month, though the company’s bid is confidential, Wichers said.

“It’ll be interesting, whoever wins the bid, to see at what price they sold it for,” she said. “That will have some impact on the spot price, I would guess.”

A lot is still up in the air, but UEC is preparing for when it resumes operations for the first time since 2018.

“When we shut things down back in 2018, we did things like disconnected our piping and things like that, so now we’re back reconnecting all of our piping,” Wichers said. “We have a list a mile long: checking wellhead integrity, leak detection systems, cleaning our parts and pieces that go on top of our well heads, checking pumps, reinstalling wellhead boxes. We’re doing all kinds of things to get ready.”

The U.S. Energy Information Administration estimates that UEC’s mines in Campbell and Johnson counties could produce 1.3 million pounds of uranium annually.

Resumed production would result in ad valorem tax revenue for Johnson County, which has declined as mineral production declined the past few years. In 2014, U1A paid $1 million in ad valorem taxes, according to previous Bulletin reporting.

UEC currently has 10 employees working at the mine and five working in the company’s Casper office. The company will bring on four to five employees for the preparation process, called properational de-risking. When operations begin, Wichers said, there will be close to 20 positions open. And once operations ramp up and the mine is at full capacity, there could be 50 to 70 people at the mine site.

“When we get the go ahead from our boss, we will flip the switch and we will energize the well fields that we had stopped mining,” Wichers said. “We will initiate our operations back in those well fields and start construction of new well fields.”