Japan Election An Early Holiday Gift For Uranium Market

Published on Friday December 28 2012 (AEST)

As many industry analysts predicted, uranium stocks rallied strongly following the Liberal Democratic Party's (LDP) landslide victory in Japan's election over the weekend. 

Since the Fukushima disaster, Japan has become the bellwether for the sector. The LDP's pro-business and pro-nuclear platform means that its win over the incumbent Democratic Party of Japan (DPJ) --- whose members promised in September to phase out the nation's nuclear power program by 2040 --- will help rebuild positive sentiment in the flagging uranium market. 

"We think this could be the turning point in the sector many have been waiting for and reiterate our affinity for select uranium names in 2013," said Chris Berry of Discovery Investing and House Mountain Partners in his latest edition of Morning Notes. The LDP garnered a two-thirds majority in Japan's lower house of parliament after campaigning on the "need to restart the reactors to cut the cost of importing natural gas and coal to fire conventional power stations," reported Bloomberg's Christopher Donville. News of the election's outcome led to significant jumps in some companies' share prices, including Uranium One (TSX:UUU), Energy Resources of Australia (ASX:ERA), Bannerman Resources (ASX:BMN,TSX:BAN), Paladin Energy (ASX:PDN,TSX:PDN) and Cameco (TSX:CCO,NYSE:CCJ). Pre-Fukushima, nuclear power accounted for nearly 30 percent of Japan's energy supply; now, however, only two of its 50 nuclear reactors are operational. 

Alternatives like natural gas, oil and coal resources are limited on the island nation, and the high cost of importing energy has placed a significant burden on the country, which is trying desperately to rebuild its economy. To alleviate the problem, the LDP believes Japan must restart the remaining idled reactors quickly and has proposed a three-year review to determine which are safe enough to come back online. "The cost of higher energy imports is increasing the cost of living; Japan's balance of payments is weakening; and the government's ability to stimulate economic activity is being hampered. Renewable energy and imports of oil/liquefied natural gas are too expensive for the economy to maintain," said Robert Gill, portfolio manager with Morrison Williams Investment Management, as reported by The Globe and Mail. However, investors should remain cautious, advises Berry in Morning Notes. "To be clear, if and when a re-start of the Japanese reactors commences, it may take longer than many anticipate as each nuclear plant must be inspected and cleared to resume operations. 

Reportedly, the Japanese Nuclear Regulation Authority is actively inspecting six plants to determine if they were built on active fault lines." To facilitate a faster restart process, industry insiders have said the LDP will need to push through changes to the current regulations set down by the DPJ, which require that any nuclear reactor restart have the approval of the prime minister, energy minister, two additional cabinet members and Japan's new nuclear regulation agency. Analysts expect a wave of nuclear restarts in Japan between 2013 and 2015. That will increase U3O8 demand at the same time as the market is forecast to experience a significant drop in available supply. 

Near the end of 2013, the US-Russian Highly Enriched Uranium (HEU) Agreement --- officially dubbed the Megatons to Megawatts Program --- will be coming to an end. The HEU agreement has accounted for nearly 15 percent of global uranium supply, and its termination in the new year heralds a looming uranium supply shortage that market watchers believe will be the catalyst for a return to the glory days for uranium stocks, especially if the industry keeps experiencing supply setbacks. 

The most recent report of production setbacks comes from Australia, where the federal Environment Minister has delayed an approval decision on Toro Energy's (ASX:TOE) Wiluna uranium project --- slated to become the state of Western Australia's first uranium mine. Couple the end of the HEU agreement, the new beginning for Japan's nuclear industry and the enormous growth in China's nuclear program --- 60 new reactors over the next decade --- with the avalanche of expansion and production deferrals this past year --- including Olympic Dam, Langer Heinrich, Cigar Lake --- and the uranium market just may be on the verge of a roaring comeback.

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Uranium - Basic Economics 101

Published on Monday December 17 2012 (AEST)

Some facts about Uranium requirements going forward.  

BP, BHP We read and hear a lot of misinformation in the mainstream media about nuclear energy and its use world wide. Many countries expect to be forced to use more nuclear power in their systems, that no matter what you may read or hear. 

It is basic economics, and inevitable. 

Japan is now pursuing new sources of Uranium, and it is Uranium that is the fuel for nuclear plants. Analyst in the sector are saying Uranium supplies are looking tight in the face of potentially large new demand. They are forecasting strong growth in nuclear power centers on China, India, and Russia. The populations of these nations are huge, and are among the lowest consumers of electric power in the world. According to British Petroleum’s “Energy Outlook 2030″ NYSE:BP study, the countries will increase their use of nuclear power 7.8% per year through Y 2030. 

That means the nuclear power demand from those countries will more than double by Y 2020 and will grow 4 times that by Y 2030. Putting that into a global perspective; the world has 436 active nuclear reactors today with a total capacity of 374 gigawatts (GW). Another 62 reactors are under construction and will add 63 GW of capacity. 

Each gigawatt of increased capacity requires about 200 metric tons of Uranium per year. And the 1st fueling for new reactors require between 400 to 600 metric tons of Uranium, according to the World Nuclear Organization. So, the 62 new plants will need a minimum of 25,000 metric tons of Uranium in their 1st yr of production and 12,400 metric tons per year after and ongoing. According to the World Nuclear Organization, total demand for uranium will hit 67,990 metric tons in Y 2012. 

The 62 plants under construction will raise that 18%. Food for thought, there are another 484 reactors on order, planned, or proposed.  

China alone accounts for 171 of those planned reactors, 

India for 57. 

Russia for 44. 

These potential reactors represent 542 GW of electric power. When those reactors are built, they will more than double the world’s existing nuclear facilities. On the Uranium supply side the supply is likely not to easily meet demand, what with the economic uncertainty, the huge capital costs, and negative public sentiment toward nuclear power. The highest-profile supply problem was BHP Billiton’s NYSE:BHP decision to delay its Olympic Dam mine expansion, taking 14,545 metric tons of Uranium per year out of the supply chain. Plus, the Kazakhstan government shelved about 4,500 metric tons of new projects recently.  

Some other notable delayed/shelved projects

1/  Areva’s Trekkopje, 
3,600 metric tons per year put on hold.

2/  Areva’s Imouaren, 
5,000 metric tons per year put on hold.

3/  Cameco’s Double U, 
reduced by 1,800 metric tons per year.

That is about 29,550 metric tons of Uranium per year of expected supply has been curtailed. This could create a substantial supply squeeze over the next few years. 

This is now basic economics 101, when supplies are low and demand is high, prices will rise. And that most often means gains can be had when Uranium prices enter a its next Boom. 

Stay tuned…...................................

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Uranium Set To Get A Boost From Japanese Election Outcome

Published on Sunday December 16 2012 (AEST)  

With opinion polls forecasting a victory for the pro-business Liberal Democratic Party the outcome of Japan's election this weekend is expected to revive the fortunes of uranium producers and explorers, hard hit since the 2011 Fukushima disaster. 

The Australian reports that the Liberal Democratic Party, traditionally considered the pro-business and pro-nuclear wing of Japanese politics, is expected to replace the Democratic Party of Japan in office following several years in opposition. Despite the recent Fukushima disaster which has tainted the reputation of nuclear energy in Japan the LDB has a relatively nuclear-friendly policy platform which would see a number of Japan's 48 decommissioned reactors rebooted following a three-year review process. 

If implemented the proposal would revive uranium demand from Japan and significantly bolster the fortunes of producers and explorers of the nuclear raw material, all of whom have endured hard times in the wake of the Fukushima disaster. The closure of Japan's nuclear power system took a severe toll on the global uranium sector, with uranium prices and shares in key producers falling precipitously. 

Australia's Paladin Energy has seen its share price fall from $5 just prior to the Fukushima disaster to around 89c at present, while the plunge in uranium prices due to the absence of Japanese demand has attenuated profits. 

Another factor likely to boost the fortunes of uranium in the near-term is the expiration of the highly enriched uranium agreement (HEU) next year, which currently provides around 15% of global uranium supply via the conversion of which Soviet nuclear warheads into reactor fuel.

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Delivery Of First Floating Nuclear Power Plant Set For 2016

Published on Friday December 14 2012 (AEST)  

Russian utility Rosenergoatom has signed a new contract with the Baltiysky Zavod shipyard for the completion of the first floating nuclear power plant. It is now scheduled for commissioning in 2016. Under a contract signed on 7 December in St Petersburg, Baltiysky Zavod-Shipbuilding - the successor to the Baltiysky Zavod shipyard - will now complete the vessel for delivery to Rosenergoatom on 9 September 2016. The plant – dubbed the Akademik Lomonosov – will then be put into use in Vilyuchinsk, in the Kamchatka region in Russia's far east. The keel was originally laid for the first floating plant at the Sevmash shipyard in Severodvinsk in April 2007. 

However, in 2008, Rosatom said that it was to transfer its construction to Baltiysky Zavod because Sevmash was inundated with military contracts. A contract was signed in February 2009 between Rosatom and Baltiysky Zavod for completion of the plant. At that time, the vessel was due to be completed in 2012, but work was hindered as the shipyard found itself facing bankruptcy. 

Shipyard reborn In August 2011, at the request of Rosenergoatom, the partly-built floating nuclear power plant was seized by the Court of Arbitration of Saint Petersburg as the Baltiysky Zavod shipyard faced bankruptcy proceedings. Rosenergoatom was afraid that it could lose its investment in the 9.8 billion rouble ($340 million) project if another claimant seized the shipyard's assets during those proceedings. The largest shareholder in the Baltiysky Zavod shipyard, with an 88.3% stake, was United Industrial Corporation, which is owned by Sergei Pugachev. 

This stake had been pledged to Russia's Central Bank as collateral for an unreturned loan to International Industrial Bank, another Pugachev-controlled company which was declared bankrupt in November 2010. Baltiysky Zavod went into receivership in January 2012 and Rosenergoatom was forced to cancel its contract with the shipyard. However, the shipbuilding company was acquired by state-owned United Shipbuilding Corporation in May and has since been relaunched as a new company. According to Rosenergoatom, over 90% of the work has been completed on the hull of the Akademik Lomonosov. 

The turbo-generators have already been installed, while the two 35 MW KLT-40S nuclear reactors - similar to those used in Russia's nuclear-powered ice breakers - have been assembled and delivered to the shipyard ready for installation. The first batch of fuel for the floating plant has also already been produced. 

Uranium Mining To Be Stepped Up By China National Nuclear Corp

Published on Tuesday November 13 2012 (AEST)  

China National Nuclear Corp will speed up overseas uranium mining exploration, focusing on Australia, Africa and Central Asia, to meet the energy company's growing demand for the raw material, its chairman said on Monday. "We have no worries about uranium resource reserves, as we will enhance efforts on exploring the resources both at home and abroad," said Sun Qin, chairman of China National Nuclear Corp, a State-owned energy company which runs more than 40 percent of China's nuclear sites. He said the eurozone debt crisis has given Chinese companies such as CNNC a good opportunity to expand their overseas mining operations. 

"We will step up uranium mining projects in foreign countries," he said. "The target overseas markets include Australia, Africa and Central Asia." The Ministry of Land and Resources said on Nov 4 that a large leaching sandstone-type uranium deposit had been discovered in northern China's Inner Mongolia autonomous region. Considered one of the world's top uranium mines, it is the country's largest leaching sandstone-type uranium deposit so far, which is of great significance for boosting domestic uranium supplies and ensuring sufficient resources to develop the nuclear power industry, the ministry said. "We expect that the domestic market will satisfy half of our demand, with the other half coming from overseas," especially through purchasing uranium resources abroad, Sun said. 

China imported 16,126 metric tons of uranium in 2011, down 6 percent from the previous year, according to the General Administration of Customs. Around 95 percent of China's uranium imports are from Kazakhstan, Namibia, Australia and Uzbekistan. "The discovery in Inner Mongolia will help China to reduce its dependence on foreign supplies," said Yan Weidong, deputy director of the management and development division of the ministry's information center. An executive meeting of the State Council on Oct 24 approved two programs, the national plan for nuclear power security (2011-20) and the nuclear power development plan (2011-20). According to these programs, China is expected to have 40 million kilowatts of installed nuclear capacity by 2015, which would consume at least 7,500 tons of natural uranium annually. Inland plants "China is expected to start building inland nuclear power plants during the 13th Five-Year-Plan (2016-20) at the earliest, and is conducting research and risk evaluation on the construction of the inland nuclear power plants," said Sun. 

According to its national nuclear plan, China will resume the construction of new nuclear power plants, which has been suspended since the Fukushima disaster in Japan in March 2011. A small number of the plants that will be launched by 2015 will all be located in coastal areas. "Technology is not an obstacle to the development of China's inland nuclear power plants," he said. "We just lack experience. "Developing the nuclear industry is a priority" and China will continue to increase its investment in the nuclear industry, said Sun. He added that all new nuclear reactors must comply with the highest international safety standards and China will resume construction of nuclear power plants "in a steady and orderly way" and "at a reasonable pace". 

China's nuclear power generating capacity currently accounts for just 1.8 percent of the country's total electricity generation, much lower than the average figure of 14 percent for countries with nuclear power, according to a government white paper on energy. Coal plays a major part in China's energy sector. It accounts for 70 percent of the energy consumption mix and 80 percent of its electricity production. 

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Newman Lifts Uranium Mining Ban In Queensland - Breaking News

Published on Monday October 22 2012 (AEST)

Queensland Premier Campbell Newman has announced he is ending the state's decades-long ban on uranium mining. The State Government decision reverses the position Mr Newman's Liberal National Party took to the election in March. Uranium has not been mined in Queensland since the closure of the Mary Kathleen mine in the state's north-west in 1982. 

The Queensland Resources Council says Queensland holds about $18 billion worth of known uranium reserves, mostly in the state's north-west. Announcing the decision today, Mr Newman said the Federal Government's decision to press ahead with plans to sell uranium to India had sparked renewed interest in the sector.

 CLICK TO ENLARGE

The Uranium Mining Association immediately welcomed the surprise announcement.

PREMIER Campbell Newman has announced an end to the 30-year ban on uranium mining in Queensland, appointing a three-person committee to oversee its resumption. 

 

The announcement follows a State Cabinet meeting in Goondiwindi, where the government discussed a policy review of the uranium mining ban.

Mr Newman said they agreed to allow the recommencement of uranium mining, following "sustained public debate on uranium mining in Queensland and strong support for the uranium industry from the Federal Labor Government".

"The Prime Minister Julia Gillard has just been in India selling the benefits of Australian-produced uranium to India, prompting many in the community to ask about the industry's potential in Queensland," said the Premier.

"It's been 30-years since there was uranium mining in this State and in that time the Northern Territory, South Australia and Western Australia have carved out successful uranium industries that deliver jobs and properity to their regions."

Minister for Natural Resources and Mines Andrew Cripps said with Queensland's known uranium deposits worth an estimated $10 billion, the industry had enormous potential to support economic growth, particularly in regional North Queensland.

Mr Cripps said the State Government would not consider nuclear energy production or nuclear waste disposal plants in Queensland as part of the recommencement of uranium mining.

Uranium mining has not occurred in Queensland since 1982 and has been effectively prohibited since the election of the Goss Labor Government in 1989.

Exploration for uranium has not been subject to the prohibition and there has been significant continuing interest from the industry in exploring for uranium in the State.

High Activity In Store For Uranium Market

Published on Friday October 19 2012 (AEST)


 

As the demand for nuclear energy increases across the globe, engineering consultancy and project management services company Amec expects the next few years to be a period of high activity and for the uranium and the nuclear power market. Amec principal process engineer Alan Drake says uranium prices, which are currently depressed, are set to recover, which should see an increase in the number of lower-grade ore deposits being targeted. 

To fully capitalise on the uranium market, says Drake, the uranium price would need to remain sustainable in the present and long term, coupled with a strong appetite for developing uranium production. “Ultimately, the price of uranium will determine the extent to which uranium mines are developed. “If we look at where uranium demand is currently and where it’s expected to be in the coming years – taking into account the number of nuclear power plants that are currently being built or planned – the exploration of lower-grade ore deposits is a definite option,” he says. 

 He notes that the price of uranium is going to be the driving force that gets many of these lower-grade deposits off the ground and the outlook is good for the medium and long term. Another factor fuelling the demand for the commodity is that some of the current large suppliers of uranium are not going to be around to supply this demand in the coming years. Drake cites as an example the highly enriched uranium down-blending agreement between the US and Russia, which entails about 25-million pounds of uranium a year and is set to expire in 2013. This will result in a uranium shortfall of 25-million pounds, which constitutes about 40% of the US’s requirements. Drake says that, owing to the lower-grade ore being mined, innovation in the treatment and processing of the ore needs to be considered. 

 Over the last two decades, there has not been a driving need to change the way uranium was processed, largely owing to the slowdown in demand over that period. Currently, however, there needs to be a different, if not better, way of processing the mineral, as increasing numbers of lower-grade deposits are being explored. “There is no doubting the fact that the standard processes work, but they haven’t been challenged to be more cost effective. “This opens up a number of avenues for companies to study the processing trends of uranium to yield large cost-saving benefits and accommodate these lower grade ore bodies,” he says.

While considering alternative process routes for a recent uranium project, Drake says that Amec metallurgists considered how nanofiltration and membrane technology could be employed. “Twenty years ago, membrane technology was an expensive, unexplored and untested option. “Today, however, membrane technology has become more cost effective and, although not yet a fully mature technology, it is now more common and much more can be done with it.

” Drake notes that AMEC has gone as far as initiating pilot plant testwork using the technology and demonstrating that it was indeed possible to replace solvent extraction with membrane technology. 

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Areva Namibian Trekkopje Uranium Mine On Hold

Published on Friday October 12 2012 (AEST)  

Energy giant Areva said Thursday it is suspending work at a new Namibian uranium mine currently under construction due to low uranium prices. “Areva will postpone the launch of the Trekkopje mine until the project's economy improves,” the Namibian office of Areva said in a statement. 

The French company cited a decrease in uranium prices coupled with the scale of investments yet to be made on site as reasons for the move. “In October 2011, the decline in uranium prices resulting from the nuclear accident at Fukushima in Japan forced a slowdown,” a statement said. 

The mine is situated in the Namib Desert, some 300 kilometres (190 miles) west of the capital Windhoek. Construction work already underway will be completed by the end of December 2012, while existing installations will be put under a $10 million a year structured care and maintenance programme. 

The objective is to “restart the project in the best possible conditions as soon as the overall market environment allows it,” Areva said. The decision could mean job losses, but the firm said it would offer “accompanying measures” to affected workers. “Areva is committed to stay in Namibia over the long term,” it said.

Confusion Over Japan Reactor Restart Approvals

Published on Saturday October 06 2012 (AEST)  

Japan's newly established Nuclear Regulation Authority (NRA) aims to have a new safety legal framework in place by July 2013 to enable the country's idled nuclear power reactors to restart. However, it is currently unclear who will ultimately be responsible for authorizing restarts. 

An initial set of criteria will be drafted by the NRA by March 2013. These criteria will then be open for public consultation after which they will be redrafted. The NRA aims to have these safety requirements written into law by July 2013. The NRA said that utilities will be able to apply for inspections prior to July 2013, although the NRA would not give its final conclusion on those inspections until after the legislation has been passed. However, there appears to be confusion as to who will ultimately be responsible for granting approval for reactors to restart. 

The authority has previously lain with the government, but this now looks likely to pass to the NRA. Permission was granted by prime minister Yoshihiko Noda in June for two reactors to resume operation. After a meeting with Edano and two other cabinet colleagues, Noda announced that the two units at Kansai Electric Power Company's (Kepco's) Ohi plant in Fukui prefecture had been given clearance to restart in order to prevent power shortages in the region. Both units were back at full power by the end of July. Last week, industry minister Yukio Edano said that reactors would be permitted to resume operation "if the Nuclear Regulation Authority has given the green light to safety and if local governments have shown their understanding.

" This suggested that once clearing safety checks by the NRA, utilities would need to seek permission from local governments for the restart of their reactors. The central government, Edano said, "is in no position to declare that they are safe." However, chairman of the NRA Shunichi Tanaka said on 3 October that the regulator's responsibility is purely to assess whether a reactor is safe to restart and not to give authorization for their restart. 

Permitting units to resume operation "is a major decision that must be made by somebody, and I believe that our safety assessment plays an important role in making that judgement," Tanaka was quoted a saying by The Japan Times. "But to reactivate the reactors, there are various issues to consider, including gaining permission from local residents and municipal officials, and that is beyond the bounds of our authority." 

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Condolence As Black Range Minerals Reports Passing Of CEO Tony Simpson

Published on Tuesday September 25 2012 (AEST)

Black Range Minerals (ASX: BLR) has advised with deep regret that is its managing director Tony Simpson has passed away late on 21 September 2012. 

 “On behalf of my fellow directors, our staff, and all the members of our project team I extend our deepest sympathies to Tony’s family,” chairman Alan Scott said. “On behalf of my fellow directors, our staff, and all the members of our project team I extend our deepest sympathies to Tony’s family,” chairman Alan Scott said. 

Tony  Simpson joined Black Range in December 2011 and brought a huge amount of drive and energy to the company and assembled a first class, experienced team of professionals to advance the company’s projects through the development phase. 

Scott said he always believed that people made projects happen and that a strong team was vital. Black Range has appointed chief financial officer Mike Drew as the interim chief executive officer and will make an announcement regarding ongoing management in the coming days. 

Black Range Minerals (ASX:BLR) is developing the Hansen/Taylor uranium project in Colorado which has a JORC resource of approximately 90.1mlbs U308, production is targeted for 2016.

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Uranium Recovery Postponed as Price Drops to 2-Year Low

Published on Wednesday September 19 2012 (AEST)  

Uranium’s recovery from the Fukushima nuclear accident may take one or two years longer than analysts estimated as stockpiles in Japan and Germany keep prices low and cause mining companies to defer new development. 

The price of uranium for immediate delivery declined to $47 a pound as of Sept. 17, its lowest in two years, according to Ux Consulting, a Roswell, Georgia-based uranium information provider. BHP Billiton Ltd. (BHP) and Paladin Energy Ltd. (PDN) have slowed or deferred development this year of some projects to produce the raw material in nuclear reactor fuel. 

Japan temporarily shut all of its nuclear reactors after the disaster at Tokyo Electric Power Co.’s Fukushima Dai-Ichi plant. That nation’s return to nuclear power and demand for electricity in China, which is building 25 reactors, was supposed to help drive prices for the fuel back up in 2015, said Thomas Neff, a retired physicist at the Massachusetts Institute of Technology. That date that may be pushed back a year or two.

“There was a wave of optimism the Japanese would come back on fast and that China would resume rapid development,” Neff, who now works as an energy industry researcher for the university’s Center for International Studies, said yesterday by phone from Jackson, Wyoming. “Day-to-day spot prices are reflecting the belief that the short-term outlook -- at least two to three years out -- is less certain than it was.” 

Japan will end the use of atomic power by the 2030s, the government said Sept. 14, and Germany’s government has also decided to phase out nuclear energy. China continues to review approvals for new reactors amid concerns about safety, Heenal Patel, a London-based energy analyst with Bloomberg Industries, said yesterday. 

Net Demand

“Japanese and German inventories and displaced supply would result in no net new demand until after 2015,” Neff said, citing a January study his group did. The new target for a return to uranium demand is 2016 or 2017, he said.

Not everyone expects the uranium price to languish.

“We retain strong conviction in starkly higher prices on compelling supply-demand fundamentals and the prices required to incentivize new supply,” David Sadowski, a Vancouver-based analyst at Raymond James Ltd., said in a Sept. 8 note to clients. 

Sadowski expects prices to average $60 a pound next year, $72 in 2014 and $75 in 2015, according to the note.

Prices this year have averaged $50.84 a pound. Uranium next year may average $64 a pound, the median estimate of four economists and analysts. Three analysts expect $70 in 2014, according to data compiled by Bloomberg. 

BHP, the world’s largest mining company, last month put on hold an expansion that would make its Olympic Dam project in Australia the biggest uranium mine. 

‘Economic Challenges’

Cameco Corp. (CCO), the world’s third-largest producer, said in July that its Kintyre uranium project in Australia would need a $67 uranium price to be economical. The company sold uranium for $42 a pound during the second quarter. 

“To fuel the more than 60 reactors currently under construction and the further growth we expect by 2021, production will have to come from new primary sources,” Saskatoon, Saskatchewan-based Cameco said in a July 27 statement. “In today’s environment, those sources of production pose economic challenges, for us and other producers, similar to those we have identified at Kintyre.”

Paladin, an Australian company that mines uranium in Africa, is delaying a feasibility study on phase four of its Langer Heinrich mine in Namibia, the company said on a conference call in May. 

A lack of investment in new mines may lead to a substantial increase in prices toward the end of the decade, said Dustin Garrow, Paladin’s executive general manager of marketing. 

“You’d have to see $85 uranium on a sustained basis to justify construction of new mines to meet supply requirements through 2020,” Garrow said yesterday by phone from Littleton, Colorado. 

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Colorado Mining Towns Hope For Uranium Comeback

Published on Saturday September 08 2012 (AEST)  

URAVAN, Colorado USA . (AP) — Sharon Johannsen rolls along Highway 141, the sun baking the sandstone hills of southwestern Colorado's Paradox Valley. 

She pulls over at a wire fence: This was the baseball field; that was Main Street. All of it buried, with signs warning visitors about radiation. Uravan, where Johanssen grew up, was a company town of 800 people with a uranium mill along the San Miguel River. Johannsen's grandfather and father worked at the mill and a uranium mine nearby. The U.S. Vanadium Corp. built Uravan's housing, community pool and a recreation center, and Uravan helped supply the uranium used to develop the first U.S. atomic bombs that ended World War II. Uravan and other towns in the Four Corners region went on to supply uranium for nuclear weapons and the nuclear power industry. But the boom collapsed with the end of the Cold War and troubles with nuclear energy starting with Three Mile Island in 1979. Uravan's own troubles were worse: Some 12 million tons of radioactive tailings and other waste pushed radon levels well above safety standards. The town was declared a Superfund site, evacuated and razed in the 1980s. "They buried the Coca-Cola glasses out of the drug store," said Johannsen's sister, Jane Thompson. "They buried everything.

" Today, a Canadian company's plan to build the first conventional uranium mill licensed in the U.S. since 1979 has area residents hoping the region can once again become the uranium capital of the U.S. But there are obstacles, especially since uranium prices crashed after the 2011 meltdown at Japan's Fukushima nuclear plant. The spot price of uranium was more than $135 a pound when Energy Fuels Inc. announced plans for the Pinon Ridge Mill in 2007. Today it's around $49 per pound, and CEO Steve Anthony said it won't make sense to build the $150 million mill until uranium hits $80 per pound. Nicolas Carter, senior vice president of uranium at nuclear consulting company UxC, said global demand for uranium is expected to increase over the next few years with new reactors in China, the United Arab Emirates and South Korea. UxC projects there will be 516 operating reactors in the world by 2020, compared to 435 today. Energy Fuels is eying the domestic market, too. 

The nation's 104 commercial nuclear power reactors consume around 55 million pounds of uranium per year, but only 4 million pounds is domestically produced, Energy Fuels says. Russia supplies half of U.S. demand by shipping down-blended uranium from decommissioned nuclear weapons under a "Megatons to Megawatts" treaty that expires in 2013. Pinon Ridge would produce 850,000 pounds of uranium, in addition to steel-strengthening vanadium, per year. Energy Fuels owns the nation's only operating conventional uranium mill in Blanding, Utah, processing 1.5 million pounds a year. U.S. production is boosted by a handful of uranium in-situ-leach plants. Serguey Novikov, a spokesman for Rosatom, Russia's nuclear energy agency, said the U.S. Commerce Department will allow Russia to send 12 million pounds — 20 percent of U.S. demand — after the treaty expires. In Colorado, Energy Fuels promises 85 jobs at Pinon Ridge that would pay from $40,000 to $75,000 a year. It insists the mill will support 200 existing uranium and vanadium mining jobs in the region. Opponents filed a lawsuit that has forced the state health department to hold a new public hearing Oct. 15 on the operating license it issued the company — though the project is expected to clear that hurdle. 

The Telluride-based Sheep Mountain Alliance argued that air quality in the resort town 65 miles away could be threatened if anything goes wrong. "Dust and pollution don't know county lines," said Joan May, a San Miguel County commissioner. Others worry about the mining-dependent region's historical boom and bust cycles. Highway 141 is dotted with small towns hit hard by the collapse of mining — Redvale, Vancorum, Naturita. Still others worry Pinon Ridge will reduce local property values because of fears about uranium. Energy Fuels — and the state — insist tougher safety controls minimize any risk to mill workers and area residents. It plans to use plant and personal detectors to track airborne radioactivity, according to documents filed with the state health department. "We just live in a different world that controls all this much better," said Steve White, Montrose County's planning and development director, who helped issue a permit allowing agricultural land to be used for the mill. 

Over the decades, many area miners contracted lung disease from poor mine ventilation and from smoking. Despite that legacy, some residents insist that their fathers, brothers and grandfathers would have continued to mine and work the mills, even if they knew it would make them sick. The ethic of putting food on the table and a devotion to the industry trump worries over health, they said. "If it wasn't safe, we would be the first people to not want it here," said John Reams, who owns a construction company in nearby Naturita and was a miner in the area from 1977 to 1981. 

Richard Espinoza lived in Uravan from 1951 to 1964 while his father worked at the mill. The company ran everything from the gas station to the drug store to the Uranium Drive-in. "It's like if you ever played SimCity," Espinoza said, referring to the simulated video games where players build entire communities online. "It's almost like when you moved in, there was a welcoming committee. ... It's just the way people were." Elva Archer Ayers is a Redvale resident who has lived in the area since 1930. She said her family worked in the Uravan mill and nearby mines — some of them during the secret Manhattan Project. "I lost five brothers, my husband, two brothers — lost with cancer," Ayers said. "I don't have a feeling that we shouldn't go ahead (with the mill.) Our kids has got to live." 

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LYNAS Corporation Receives TOL Temporary Operating License

Published on Wednesday September 05 2012 (AEST)

LYNAS Corp has gained a temporary operating license for its rare-earths refinery in Malaysia and expects to begin operations at the plant next month. "Receiving this licence from the Malaysian Atomic Energy Licensing Board is a significant milestone for Lynas," said Lynas Executive Chairman Nicholas Curtis in a statement.

Lynas' share price had Wednesday traded at just one third of where it stood 12 months ago, after continued uncertainty over the Malaysian project weighed on the stock in recent months. Lynas's $US230 million Malaysian processing plant is intended to produce about a sixth of the world's supply of rare-earths at full production. Rare earths are used in products ranging from electric car batteries to smartphone touch screens. The company finished construction on the first phase of the plant last month, moving the company closer to its goal of breaking China's grip on the industry.

Chinese firms currently account for about 95 per cent of global output, and steps by the government there to limit exports of raw materials to help develop its own manufacturing industries has piqued worldwide concern over a potential supply shortfall and over-reliance on a single source for the raw materials. Still, Lynas' project has run into opposition from activists and politicians in Malaysia because of the perceived hazard from radioactive waste.

Thousands of people had rallied in protest against the plant in February on concern that radioactive waste may seep into the ground and water, harming the environment and people's health. Lynas has insisted the plant is safe, and that any radioactive waste produced wouldn't harm human health. The refinery, located in the eastern Malaysian state of Pahang, will process material extracted from Lynas' Mount Weld rare-earths deposit in Australia.


PRESS STATEMENT
BY EXECUTIVE SECRETARY,
ATOMIC ENERGY LICENSING BOARD (BOARD)

DECISION ON THE ISSUANCE OF THE TEMPORARY OPERATING LICENCE (TOL) TO LYNAS (MALAYSIA) SDN. BHD.

1. The Atomic Energy Licensing Board (Board) at its meeting on 30 January 2012 had decided to approve the application for a TOL by Lynas (Malaysia) Sdn. Bhd. (Lynas), subject to several conditions. The TOL, however, was not issued since Lynas need to fulfil additional conditions under Act 304 and its subsidiary regulations.

2. The Board at its meeting on Monday, 3 September 2012, was satisfied that Lynas has fulfilled all technical aspects, including the institution of dust control measures and radioactivity immobilisation methodologies in its residue management system, and all regulatory requirements. The Board also took note that Lynas has made a commitment to remove from Malaysia the Water Leach Purification residue arising from its LAMP project. In this regard, the Board has decided to issue the TOL to Lynas, to be effective for two years from 3 September 2012 to 2 September 2014. The TOL will enable Lynas to conduct trial processing of lanthanide concentrates in stages and in limited quantities under close and continuous surveillance by the authorities.


Atomic Energy Licensing Board
Ministry of Science, Technology and Innovation (MOSTI)
5 September 2012

Note:

A Press Briefing will be held at 10 am, Bilik Mesyuarat Lembaga, Ibu Pejabat Lembaga Perlesenan Tenaga Atom, Batu 24 Jalan Dengkil, 43800 Selangor on Friday 7 September 2012.

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BHP Cancels $30 Billion Olympic Dam Copper-Uranium Mine Expansion Near Roxby Downs

Published on Wednesday August 22 2012 (AEST)  

BHP Billiton has shelved its $30 billion Olympic Dam expansion and will go back to the drawing board to find a cheaper alternative. Market conditions, subdued commodity prices and higher capital costs led to the decision, said BHP chief executive Marius Kloppers in a statement. 

"As we finalised the details of the project ... it became clear that the right decision for the company and its shareholders was to continue studies to develop a less capital-intensive option to replace the underground mine at Olympic Dam," Mr Kloppers said. 

 "Value is always our primary consideration. We believe today's decision reflects an appropriate, prudent and disciplined course of action." 

The mine would have become the world's biggest open cut copper and uranium mine at six Kilometres long and one Kilometre deep. 

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Camecos Kintyre Uranium Project Halted

Published on Saturday July 28 2012 (AEST)

Uranium prices halt Sandy Desert Project THE most likely of Australia's next big uranium mine developments - the Kintyre project in Western Australia's Great Sandy desert - has fallen victim to sluggish demand and prices for the nuclear fuel, and WA's "hot" construction market for resource projects.

Project operator and 70 per cent owner, Canada's Cameco, has revealed that the economics of the project are "challenging" in that a development would not be profitable at current uranium prices. Prices are 34 per cent below where they need to be for a viable project. The sluggish demand backdrop has implications for BHP Billiton which must find a home for the additional uranium it will produce with the planned $30 billion expansion of its Olympic Dam copper/uranium/gold mine in South Australia's outback. 

The expansion would see uranium output at Olympic Dam grow massively from 9.6 million pounds a year to 40.6 million pounds a year - 17 per cent of forecast global mine output in 2020. But the Weekend Australian revealed that BHP plans to defer a decision on the project for two years. Sluggish uranium demand has already reported to have led to BHP becoming disinterested in moving towards developing its Yeelirrie uranium deposit in WA. 

 Cameco chief executive Tim Gitzel told analysts that Cameco was "not going to develop Kintyre at any cost." An eventual development of the mine is dependent on improved uranium prices, or a substantial increase in the project's resource base. A recently completed prefeasibility study in to a development confirmed the challenging economics. It means that Cameco and its 30 per cent partner, Japan's Mitsubishi Development, will not begin development of what would have been WA's first uranium mine in early 2014 as first planned. A 2014 start to production would have meant first production in 2016. 

Discovered more than 25 years ago, the contemplation of Kintyre's development only became possible with the election of the pro-uranium mining Barnett government in 2008. It was in the same year that Rio Tinto, struggling to raise cash in the wake of the global financial crisis and its ill-timed acquisition of Alcan, sold Kintyre to Cameco/Mitsubishi for $US495 million. Cameco said that despite Kintyre being one of the world's biggest undeveloped uranium deposits (59.7 million pounds), a planned 7-year mine life that would recover 40 million pounds of uranium faced challenging economics "current uranium prices" and because of "continued cost escalation" in WA. 

 "To break even, the prefeasibility study indicates the project would require an average realised price of about $US67 or about 62 million pounds of packaged production using a uranium price similar to today's spot price ($US50 a pound)," Cameco said. Cameco said it would now set out to improve overall project economics by stepping up exploration to increase the resource base. 

 "We continue to have a positive view of the long-term fundamentals of the uranium market and want to ensure our assets are ready to respond when the market signals new production is needed. We expect a feasibility study would take about eighteen months to complete (early 2014)," Cameco said. It said that while future supply of global primary uranium production is uncertain, global consumption was quite predictable.

"We believe that to fuel the more than 60 reactors currently under construction and the further growth we expect by 2021, production will have to come from new primary sources of production. In today's environment, those sources of production pose economic challenges, " Cameco said. 

Spot uranium prices have fallen by more than 10 per cent in the last year, due mainly to the closure of the nuclear power industry in Japan following the Fukushima disaster. Mr Gitzel told analysts that the recent restart of two reactors in Japan would "pave the way for more restarts." 

"We've also seen some Japanese utilities come into the market to contract for uranium. So we believe that these restarts are just the beginning and that these restarts, along with further restarts and new reactors coming online in China, and utilities continuing to return to long-term contracting, will help move the industry away from its current near-term uncertainty," he said. 

"When the market does move, it tends to move quite quickly as we saw in 2007, and again, in 2010. And the long-term fundamentals are there to support positive movement in the industry. 95 net new reactors are expected by 2021 and more than 60 of those are under construction right now."

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UK Billionaire Richard Branson Urges Obama to Help Develop Fast Reactors

Published on Monday July 23 2012 (AEST)
 

Along with the president of the American Nuclear Society, Virgin Records founder and serial entrepreneur Richard Branson is urging the Obama administration to fund research into integral fast reactors. In documents obtained by the Guardian newspaper, Branson asked unsuccessfully for meetings with Barack Obama and Energy Secretary Steven Chu. 

He signed a letter promoting integral fast reactors as a source of abundant energy and a treatment method for plutonium and nuclear waste. The letter was also signed by climate change campaigner and Goddard Institute chief James Hansen and ANS President Eric Lowen, the Guardian reported Friday. 

Lowen is also the chief engineer for GE-Hitachi's PRISM small modular IFR, which the company pitched to the UK government as a way to dispose of the country's unwanted stockpile of plutonium last year. Branson is not the only billionaire promoting fast neutron reactors as a way to address climate change and climbing worldwide energy demand. 

Bill Gates is also backing and promoting a so-called standing wave reactor under the company TerraPower. As envisioned, it would run for years by breeding and immediately burning plutonium from a chain reaction within a core of depleted uranium that's initially set off by a small amount of enriched uranium 235. 

As with other reactor concepts that breed fissionable isotopes, though, both Gates' and Branson's favored technologies face resistance in the US because of proliferation concerns regarding the plutonium and other elements they can create.

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