Open Spaces
5:20 pm
Fri June 15, 2012

Uranium Mining In Jeffrey City: Past, Present and Future

HOST: Everyone is predicting a uranium boom internationally and Wyoming has the largest deposits in the U.S. The state has a legacy of uranium mining, as well. Wyoming Public Radio’s Irina Zhorov looks at the boom and its history.

IRINA ZHOROV: In Wyoming, there are 321 abandoned uranium mine sites, ranging from minor to major projects. A few sit on the outskirts of Jeffrey City, between Rawlins and Lander. It’s easy to pass the town’s empty buildings when speeding along 287. The mines there, and throughout the state, were exploited prior to the environmental laws passed in the ‘70s. 34 have been reclaimed.

Outside of Jeffrey City is a site that hasn’t been reclaimed, yet. Frank Filas, with Energy Fuels, a uranium mining company, walks off the dusty road for a better view.

ZHOROV: What are we looking at?

FILAS: This is the McIntosh pit. That pit lake there is fairly deep.

ZHOROV: The water is of a brilliant blue color and sits walled in by large, stepped banks cut into the rock.

FILAS: The water is generally of pretty good quality, because it’s a uranium mine though the radionuclides are above drinking water standards but it’s still pretty good water.

ZHOROV: But it’s not drinking quality water.

Near the pit sits a pile of sand. The sand has uranium in it but so little that they didn’t bother processing it. The Geiger counter I brought along chirps at it. 

FILAS: You wouldn’t have a pile like this is downtown Laramie or something. But in a remote location like this it’s not causing any harm to anybody. It’s not that much above background levels.

ZHOROV: By background levels he means the natural radiation that’s present everywhere. It sounds more like this. [Geiger beeps]

Energy Fuels is currently working on permitting a new open pit mine at the site, similar to the pit we’re standing at, along with an underground mine to accompany it. They’re a minority amongst the other companies descending upon the state’s uranium reserves, who mostly mine in-situ. In-situ uses water to dissolve the uranium underground and pump it to the surface, and is much cheaper to do.

The last boom was driven by the Cold War and prices were set by the Atomic Energy Commission. This one comes as stockpiles of uranium for an increasing number of power plants dwindle. 

FILAS: It won’t be like the good old days, that the uranium miners descended on this country in droves.

ZHOROV: But while Federal and State agencies are cleaning up the mess left behind by the previous boom, the Nuclear Regulatory Commission, the Wyoming Department of Environmental Quality, the Office of Surface Mining and a smorgasbord of other agencies are already loaded down with applications for new mines.

Today’s industry acknowledges concerns of potential contamination, radiation, and dangers to workers, but say the post-law era is meticulous about mitigating those issues. Companies do pre-production monitoring of water and air, are checked on by regulators during production, and have to clean up sites.

The Land Quality Administrator of the D-E-Q, Nancy Nuttbrock, says regulators work closely with companies to make sure they’re adhering to the law. Essentially, they rely on the industry to self-regulate to some extent.

NUTTBROCK: Given some of the limitation on our staff and surely the number of staff that we have relative to the number of operators that are coming into the state, that working relationship has to be there, and it has to be functioning at a premium.    

ZHOROV: Two years ago the D-E-Q requested funding from the legislature to fund additional employees for site inspections. There was one producing mine in the state at the time. Now, according to Nuttbrock, there are two producing sites and five more that are close to starting. There are 19 projects currently permitted and 4 pending applications. The request for more inspectors has been turned down.

NUTTBROCK: That is a concern of mine, it is.

ZHOROV: Matthew Weinschenk is senior analyst at the Wall Street Daily. He analyzes the uranium industry.

WEINSCHENK: Whether you consider it good or bad, I think we’ve only seen policy in the U.S. being towards more open energy production. I don’t think we’re going to see much push back from the actual regulators to slow things down very much.

ZHOROV: Still, development is slow. For example, Energy Fuels has about 3 more years to go in just permitting work. One of the biggest concerns right now is whether regulators can keep up with the incoming applications.

Part of that slow development also has to do with prices. They’re high enough for existing projects to make a healthy profit, but not so high that new projects can join them.

WEINSCHENK: With uranium prices currently at $52 per pound it doesn't make economic sense to bring these new big projects online. But if you look at all the potential uranium properties that we know about, prices would have to hit about $83/pound for the average project to return its owners 15-percent on investment, which is sort of the average threshold.

ZHOROV: Wyoming has an advantage on this point. The state is closer to infrastructure than projects in uranium-rich Kazakhstan and even Canada, so production costs will be lower. 

WEINSCHENK: So even if prices don't get up I think you still could see a rise in production coming out of the U.S. and Wyoming area.

HOWELL: That’s the catch phrase, ‘We’ll believe it when we see it.’

ZHOROV: That’s Vikki Howell, who owns the one local bar in Jeffrey City. It’s the social hub of the ghost town.

Energy Fuels obviously believes it, though. They’re plowing ahead with their development.

For Wyoming, more mines would mean revenues from production, and jobs, direct and indirect. And for Jeffrey City, that could mean a revival.

HOWELL: There were three bars in this town because the miners couldn’t party with the ranchers and the ranchers couldn’t party with the oil field workers. This was the cowboy bar, the rancher bar. Because the ranchers are still in business. There is a fondness for that time period.

ZHOROV: Prices are expected to go high enough for a resurgence, but the future projects sit between the two old pits; the new boom sandwiched between the old, as if somehow contained for now.

For Wyoming Public Radio, I’m Irina Zhorov.