(Douglas Budget, March 30) – Wyoming producers in 2014 were responsible for two-thirds of U.S. uranium production of nearly 5 million pounds, the most since 1997. Production in the state has been on the rise the last few years as new mines have begun operations here.
Processing 3.3 million pounds of yellowcake last year, Wyoming was again led by Cameco Resources and its Smith Ranch-Highland operation in Converse County, America’s highest producing facility, which had record production of 2.1 million pounds in 2014. The company’s higher production is due in part to its new North Butte satellite mine in Campbell County.
Cameco is licensed to process 5 million pounds of U3O8 yellowcake per year. It has operated Smith Ranch-Highland continuously for 27 years. The company also began processing material under agreement with Uranerz, which started production last year at its Nichols Ranch mine in Campbell County.
Uranerz in January announced that it would merge with Energy Fuels of Lakewood, Colorado, which is America’s second-largest producer at 20 percent of U.S. uranium production.
Just two other companies presently operate in Wyoming – Uranium One, which began operations at its Willow Creek mine in Johnson County in 2012, and produced 940,000 pounds of yellowcake in 2013, its first full year of operations; and Ur-Energy, which operates the Lost Creek mine in Sweetwater County and delivered 517,400 pounds of yellowcake last year.
Uranium produced in Wyoming is mined in-situ, involving a series of wells into which water mixed with oxygen and carbon dioxide is injected to loosen uranium from sandstone formations. The uranium bearing liquid is then pumped out through other wells and processed into yellowcake, a flour-like powder.
There are two dozen mines in various stages of permitting in the state, including those proposed by existing producers here, as well as new players on the scene. Powertech has projects proposed in Campbell, Crook and Niobrara Counties; Bayswater in Crook County; AUC in Campbell County; Peninsula Energy in Crook County; and Cyclone Uranium in Sweetwater County.
Two new mines have been proposed for Converse County. Uranium One is seeking permits for its Allemand-Ross mine in the northwest corner and the Ludeman Project proposed for nearly 20,000 acres southwest of the intersection of WYO 93 and WYO 95 northeast of Glenrock.
A weak spot price has been a challenge for producers here.
After hovering below $20 a pound for two decades, the price soared to near $140 per pound in 2007, causing many companies to begin expansion plans. Since then, the price stabilized in the $40-$50 range, until falling into the $30 range over the last few years.
Uranium One in 2013 laid off 26 Wyoming employees in the face of declining prices, warning at the time that the company needed improving prices to make its exploration efforts feasible. Even Cameco has been forced into some belt tightening, closing its Cheyenne office and consolidating its offices in Casper.
Analysts are expecting a steady increase in uranium prices in the near term, with many predicting a return to the $40-$50 range in 2015.
At its peak in the 1970s, the uranium industry accounted for more than 5,000 jobs in Wyoming. That number is closer to 500 today. Improving prices likely will steadily push that number upward as new operations get underway.
