Several of Wyoming’s known uranium reserves have landed in optimistic new hands.
Uranium Energy Corp, a mining and exploration company based in Corpus Christi, Texas, announced on December 20 that it had acquired Uranium One Americas, a subsidiary of Russian company Uranium One.
The $ 112 million deal includes seven undeveloped projects in the Powder River Basin, five in the Great Divide Basin, and many potential sites for future development. The company already owns the Reno Creek mining project in northeast Wyoming.
âThis is a really exciting development, not just for our business, but I think for Wyoming as well,â said Scott Melbye, executive vice president of Uranium Energy Corp. which Wyoming can certainly be the leader in this regard – can certainly produce a lot more than we do.
In the 1960s and 1970s, Wyoming was home to a vibrant uranium industry that employed 5,000 workers. Then high-profile accidents at Three Mile Island in 1979 and Fukushima in 2011 slowed growth and flooded the world market, causing prices to drop and most US mines to shut down.
Today, most of the uranium used to fuel the country’s nuclear reactors is imported from Canada, Australia, Russia and Kazakhstan; in Wyoming, there are only about 115 uranium workers left. The domestic uranium industry is now largely dormant as producers wait for these low market prices to recover.
Melbye believes the fortunes of the industry are about to change.
âOver the next five years, I think we’re going to see uranium prices at that level that supports production, and you’re going to see a lot of jobs and development in the industry,â he said. .
For most US growers, competitive prices start around $ 50 a pound. The cost of uranium has stayed below this benchmark since 2014, and dropped to $ 33.27 last year. But according to Melbye, global demand is finally returning to pre-Fukushima levels, and prices are expected to rise as demand continues to grow.
He expects uranium from nearly a dozen more mines will be needed in the coming years, especially if nuclear power continues to provide a significant portion of the low-carbon electricity of Many countries. And he hopes some of that extra uranium will come from the United States.
âThere is a limit to how long these American mining companies can sort of stand still and come back up, but I think we are now in a phase where I am convinced that uranium prices will recover to this. level we need to get. restarted, âMelbye said.
The process of licensing and building a uranium mine could take a decade, he said. But the Reno Creek project and three of the recently acquired Powder River Basin projects by Uranium Energy Corp are already fully licensed. Whenever market conditions return to favorable conditions, Melbye expects it to take between six months and two years for licensed mines to begin operating.
âIt seems like a long time,â he said. “But in the scheme of things, these are some of the first responders to any sort of price movement.”
Most of the projects are located on private land, meaning that royalties from any future mining would go to the landowner, while severance payments would go to the state. There is currently no federal tax on uranium production. The industry hopes that will be the case.