Pinon Ridge mill in uranium asset sale

Wednesday, 9 July 2014

The Pinon Ridge project, including the licence to build the USA's first new conventional uranium mill in 30 years, features in a list of assets being sold by Energy Fuels to private investors.

Energy Fuels announced that it has agreed to sell Pinon Ridge plus a list of mining assets along the Colorado-Utah border to a private investor group led by US-based Baobab Asset Management and former Energy Fuels president George Glasier. The assets included in the sale contain 4.8 million pounds U3O8 (1846 tU) of NI43-101 compliant measured and indicated uranium resources.

Subject to regulatory approvals, the transactions are expected to be completed by 15 October and will be worth approximately $2.05 million to the company. The purchasers will also assume all reclamation obligations and replace existing reclamation bonds for the assets, worth a further $700,000. Energy Fuels will retain a throughput royalty of $3 per ton of ore fed through Pinon Ridge, plus a 1% royalty on the market value of all uranium, vanadium and other materials that might be recovered from the mining assets.

Energy Fuels had been looking to build a new uranium mill to process ore from conventional mining operations at Pinon Ridge in western Colorado since acquiring the site in 2007. It first received a licence from the Colorado Department of Public Health and Environment (CDPHE) in 2011, although the licence was subsequently put on hold for appeal hearings before being reinstated in 2013. In the meantime, Energy Fuels' 2012 acquisition of Denison Mining's US assets and operations brought the existing White Mesa mill into its portfolio.

The acquisition of White Mesa, which can produce up to 8 million pounds of uranium (3080 tU) per year, means that Energy Fuels no longer needs to construct Pinon Ridge in order to meet its planned production.

The mining assets included in the sale - the Sunday Complex, the Willhunt and San Rafael projects, the Sage and Van 4 mines, and the Farmer Girl, Dunn and Yellow Cat projects – are all either exploration projects or historic uranium production sites. Energy Fuels CEO Stephen Antony said that the company did not expect the sale of the assets to materially affect its production potential. Antony noted that the company expected to continue with its asset rationalization, "which may include the sale of additional properties in the future."

Most of the USA's uranium production comes from in situ leach operations, and White Mesa is currently the only fully licensed and operating uranium mill for conventional mining operations (two others, Shootaring Canyon and Sweetwater, are mothballed). Located in Blanding, Utah, White Mesa is centrally located for the USA's operating uranium mines. As well as milling uranium ore, the facility has a vanadium recovery circuit and is also licensed to process uranium-bearing materials other than ore, such as those materials from uranium conversion or other metal processing.

Researched and written
by World Nuclear News