Wednesday, November 26, 2008

Western lands uranium gopher for 11/28/08

Mining media reports and press releases for useful stuff.

gopherThis is an edited version of an article originally published in Fuel Cycle Week, V7N305 on 11/25/08 by International Nuclear Associates, Washington, DC.

Denison puts Utah mine on stand-by

Denison Mines Corp. (AMEX: DNN) announced Nov 25 the temporary closure of the Tony M mine located in Ticaboo, Utah, due to the current economic situation. The firm also cited market conditions for uranium in the U.S. The mine will be put on care and maintenance.

This is the second western U.S. uranium mine this month to be put in this status. Last week Energy Fuels took similar action with the Whirlwind mine in Colorado.

Denison's expected U.S. uranium production for 2009 will be reduced by approximately 200,000 pounds, and will come in for the year at 1.2-1.6 million pounds as a result of the suspension of operations at Tony M. Vanadium production in the United States is unchanged and is expected to be 2.6-3.2 million pounds.

Denison's operating capital expenditures for 2009 are currently estimated at $10 million at the White Mesa mill, also in Utah, including $5 million for the alternate feed circuit, and approximately $9 million for all other U.S. mining properties.

Midwest Development postponed

Denison announced that the owners of the Midwest joint venture consisting of AREVA (69.16%), OURD (5.67%) and Denison (25.17%) have determined that the development of the Midwest Project will be postponed due to current economic conditions. Denison cited multiple factors as driving the decision.

  • the current economic climate,
  • delays and uncertainties associated with the regulatory approval process,
  • the increasing capital and operating costs, and
  • the current market for uranium.

Denison said that based on current estimates, capital costs have increased approximately 50% from the previous estimate of Cdn$435 million creating a new project level of capital spending of CDn$652 million.

Keeping its options open

Denison said the partners have decided to complete the environmental assessment for the project, which has been ongoing since December 2005, and to complete the engineering for the Midwest site. Total joint venture expenditures on Midwest are expected to be Cdn$12.4 million in 2009. Denison's actions this week postpone the majority of the capital expenditures to the future when presumably market conditions will warrant resumption of development of the property.

Denison stated that postponement of the Midwest project will have no impact on the firm's recently announced 2009 Canadian production guidance of 750,000 pounds U3O8. The Midwest Project wasn't even close to being a producing mine.

Denison is also significantly reducing its expected exploration and capital expenditures in 2009. Exploration expenditures in Canada are estimated at Cdn$5.1 million and US$1.6 million in the United States.

In Mongolia, the company is anticipating spending US$5.0 million to advance the projects, and in Zambia, US$3.0 million is expected to be spent to complete the Detailed Feasibility Study and secure the mining licence. The impact on Denison's uranium production beyond 2010 is uncertain.

Energy Fuels puts cash under mattress

Energy Fuels (TSE:EFR) announced a capital preservation strategy which is to say the firm is, metaphorically speaking, putting its cash under a mattress. The firm said in a press release Nov 21st is placing the Whirlwind mine on standby status. Earlier this year the mine was the focus of start-up activities leading to planned production of 200 tons/day of ore.

The firm is also shifting engineers from the mine operation to work on permit applications and environmental assessments for its planned Pinion Ridge uranium mill. The company said in the statement it plans to file the permit application with the NRC in the fourth quarter of 2009. A start-up of operations for the new mill is still planned for 2011.

Bayswater heaves U.S. properties overboard to lighten the ship

Bayswater (CVE:BAY) said in a press release Nov 11 it was allowing a number of U.S. properties to lapse and will terminate or farm out others. The firm will allow two properties in Nevada, the Holiday and Green Monster sites, to lapse. It will cease work on the Hurricane property in Utah due to challenges to its permit application from private land owners in the area. Three properties in Wyoming and one in South Dakota will also be terminated or farmed out. The firm reported that Keith Laskowski, VP Exploration, has left the company.

Bannerman gets $20 million from Colorado fund

Australian uranium miner Bannerman Resources (ASX:BNM) got some good news this week obtaining $20 million in a secured convertible note from private equity manager Resource Capital Funds with offices in Denver, Colo., and Perth, Australia. The funds will be used to develop properties in Colorado.

The management team for Resource Capital Funds hails from Rothschild Australia Limited. Bannerman also hired Len Jubber as its new CEO. Prior to joining Bannermanm, Jubber held a management position with Rossing Uranium, a subsidiary of Rio Tinto and operator of the Rossing uranium mine, the world's largest open-cut uranium mine.

Powertech to expand drilling in South Dakota

The South Dakota state Board of Minerals and Environment voted unanimously on Nov 18 to grant a permit to Powertech (TSE:PWE) for 30 more exploratory holes near Edgemont, SD, in the southwestern part of the state. The firm already has a permit to drill 155 holes in that area. Powertech project manager Mark Hollenbeck proved to the board the firm had met all of the state's legal requirements for the permit.

Opponents to the permit application had argued the project would lead to contamination of water supplies with radioactivity, destroy archeological resources, and harm wildlife. Powertech plans to construct and operate an ISR mine at the site if it gets favorable results from the exploratory drilling activities.

Vane swaps new lamps for old

Vane Minerals (LON:VML), a U.K. firm, has cashed out of its Mexican gold and silver production properties to develop uranium properties in Arizona and Utah. The firm said it had $5.97 million remaining from the sale which raised $9.33 million. The U.S. projects are a 50-50 joint venture with the Canadian firm Uranium One (TSE:UUU).

This is good news for Uranium one. On Nov 13 the Canadian company said it would take a $2.8 billion write down, mostly to reflect the lower value of its U.S. exploration properties and its Dominion mine in South Africa, which it shut in October due to falling uranium prices.

Navajo Nation takes an axe to NRC's "Generic" EIS process

chopping blockThe Nuclear Regulatory Commission's proposed "generic" environmental impact statement process would go on the chopping block today if it were up to the Navajo Nation which spans Arizona and New Mexico.

David Taylor, principal attorney with the Natural Resources Unit, stated in comments to the NRC sent Nov. 7, “The jurisdictional issue involving the Navajo Nation cannot be looked at in a vacuum. It involves substantial environmental justice implications for a Native Nation uniquely impacted by past activities now under the direct control of the NRC."

Taylor also accused the NRC of ignoring previous efforts by the Navajo Nation to enforce the Diné Natural Resources Protection Act of 2005 which banned uranium mining and milling activities within Navajo Nation borders.

Taylor said the July 1 draft devotes fewer than three pages to environmental justice in Navajo Indian Country.

He emphasized that the Nation requested the NRC, “expressly exempt Navajo Indian Country, including all lands within any federally recognized chapter of the Navajo Nation,” from the operation of any Generic Environmental Impact Statement and from any application of the alternative that may be selected."

In other words, the Navajo Nation wants no part of NRC's generic EIS and will do whatever it can to deny the agency regulatory jurisdiction over plans for uranium mining on its land.

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Anonymous said...

What exactly does this mean ?

"Vane Minerals (LON:VML), a U.K. firm, has cashed out of its Mexican gold and silver production properties to develop uranium properties in Arizona and Utah."

Van minerals still maintain the Deblito mine and are producing more the $2m a year from it. The cash you are talking about was raised this time last year from a share issue at 17p.

djysrv said...

To answer the question fron "anonymous," I relied on a published business report in the U.K.