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Uranium Investing - New Technique to Boost US Uranium Mining

Commodities / Uranium Mar 19, 2007 - 09:58 PM GMT

By: James_Finch

Commodities

Last year's basic series on In Situ Recovery uranium mining became a major success with many investors, who finally got an inside look at how uranium mining takes place. Part two of this six-part series provides a deeper understanding into the In Situ Recovery (ISR) uranium mining method.

In Situ Recovery Uranium Mining: A New Method for Mining Uranium Explained


If you study the news releases, several companies have discussed the setting up of one or more satellite plants in conjunction with their In Situ Recovery (ISR) uranium mining operations. In order to help readers better understand what exactly a ‘satellite plant' is, we interviewed Mark Pelizza of Uranium Resources about how this relatively new operational technique is presently being used at the company's Texas operations. This is part two our six-part series, describing the evolution of ISR uranium mining, building upon last year's basic series on this subject.

A larger uranium deposit, such as one at Cameco's Smith Ranch in Wyoming, requires a Central Processing Plant. The ‘mother plant,' as it is called in the trade, can complete the entire processing cycle from uranium extraction through loading the resin, stripping the uranium from the resin with a solvent (elution), precipitating, drying and packaging.

With a satellite plant, also known as a Remote Ion Exchange (RIX), smaller and distant deposits can also be mined and then trucked to the mother plant. With an RIX operation, the front-end of the ‘milling' cycle can be begun independent of the much larger mother plant. It is the same ion exchange column found at central processing facility. The mobility factor makes RIX an attractive proposition for many of the new-breed uranium producers. Rather than piping the water and uranium across a longer distance to the mother plant for the entire processing cycle, the modular nature of RIX allows for multiple columns at each well field doing the ion exchange on the spot.

This is not a new idea, but one which has instead been re-designed by Uranium Resources and is also used elsewhere. In the early 1970s, Conoco and Pioneer Nuclear Corporation formed the Conquista project in south Texas. Uranium was open-pit mined at between ten and fifteen mines within a thirty-five mile radius and in two counties. Trucks hauled ore to the 1750-ton/day processing mill near Falls City in Karnes County.

“The trademark of south Texas is a lot of small million-pound-style deposits,” Mark Pelizza told us. “I think we are heading in the right direction to exploit those small deposits.” Trucking resin beads loaded with uranium is different from trucking ore which has been conventionally mined. Small, scattered uranium deposits aren't only found in Texas. There are numerous smaller ISR-amenable properties in Wyoming, New Mexico, Colorado and South Dakota.

“About half the uranium deposits in New Mexico can be mined with ISR,” Pelizza said, “and the other half would require conventional mining.” A number of companies we've interviewed have geographically diverse, but relatively nearby properties within their portfolio. Several companies with whom we discussed RIX have already made plans to incorporate this method into their mining operations.

The sole-use semi-trailer trucks hauling the yellowcake slurry are different from the typical dump trucks used in conventional mining. According to Pelizza, the truck carries a modified bulk cement trailer with three compartments. The three compartments, or cells, each have a function. One cell holds the uranium-loaded resin, one cell is empty and the third has unloaded resin.

As per Department of Transportation (DOT) regulations, no liquids are permitted during the transportation process. Each container run between the wellfield and the mother plant can bring between 2,000 and 3,000 pounds of uranium-in-resin, depending upon how large the container is designed. The ‘loaded' cell holds between 300 and 500 pounds of resin with six to eight pounds of uranium per cubic foot of resin. Age of the resin is important, too. New resin can hold up to ten pounds of uranium per cubic foot and can decline to five pounds of uranium per cubic foot after several years.

As we found with a conventional Ion Exchange process, the RIX system is run as a closed loop pressurized process to prevent the release of radon gas into the atmosphere. The uranium is oxidized, mobilized and pumped out of the sandstone formation into a loaded pipeline and ends up in an ion exchange column at the mining site. Inside the columns, uranium is extracted through an ion exchange process – a chloride ion on a resin bead exchanges for a uranium ion. After the fluid has been stripped of uranium, it is sent back to the wellfield as barren solution, minus the bleed.

When the ion exchange column is fully loaded, the column is taken offline. The loaded resin is transferred from the column to a bulk cement trailer, which is a pressurized vessel comprised of carbon steel with a rubberized internal lining. The resin trailer is connected to the ion exchange column transfer piping with hoses. After it has been drained of any free water, the uranium-loaded resin can be transported as a solid, known as ‘wet yellowcake' to the mother plant. There, the yellowcake slurry is stripped from the resin, precipitated and vacuum-dried with a commercial-grade food dryer.

Capital costs can be dramatically reduced with the satellite plants, or RIX units. “Well field installation can cost more than RIX,” Pelizza noted. Often, installing a well field can start at approximately $10 million and run multiples higher, depending upon the spacing of the wells and the depth at which uranium is mined. Still, compared to conventional mining, the entire ISR well field mining and solvent circuit method of uranium processing is relatively inexpensive.

We checked with a number of near-term producers – those with uranium projects in Wyoming – and discovered at least three companies planned to utilize one or more satellite plants, or RIX, in their operations. A company's reason for utilizing this method is to minimize capital and operating expenses while mining multiple smaller deposits within the same area. Water is treated at the RIX to extract the uranium instead of piping it across greater distances to a full-sized plant. Pelizza said, “The potential for pipeline failure and spillage from a high-flow trunk line is eliminated.”

Strathmore Minerals vice president of technical services John DeJoia said his company was moving forward with a new type of Remote Ion Exchange design, but would not provide details. UR-Energy chief executive Bill Boberg said his company would use an RIX for either Lost Soldier or Lost Creek in Wyoming, perhaps for both. Uranerz Energy chief executive Glenn Catchpole told us he planned to probably set up two RIX operations at the company's Wyoming properties and build a central processing facility.

“We are working on a standardized design of the remote ion exchange unit so it doesn't require any major licensing action,” Pelizza said. “If you can speed up the licensing time, perhaps it would take one to two years rather than three to five years.”

By James Finch
http://www.stockinterview.com

COPYRIGHT © 2007 by StockInterview, Inc. ALL RIGHTS RESERVED
James Finch contributes to StockInterview.com and other publications. His focus on the uranium mining and nuclear fuel sector resulted in the widely popular “Investing in the Great Uranium Bull Market,” which is now available on and on http://www.amazon.com The weekly spot uranium price is posted on the TradeTech website every weekend at http://www.uranium.info


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