Ur-Energy (URE-T, URG-X) continues to drive towards production at its Lost Creek uranium project in Wyoming’s Great Divide basin.
The company passed another milestone by attaining a permit for the construction and operation of waste water retention ponds. That news comes recently after Ur-Energy announced it received permits for the injection wells at the site, and that it had raised US$5 million in a private placement.
Lost Creek is set to become an in-situ recovery (ISR) operation, a process that the company heralds for its environmental friendliness and cost effectiveness.
ISR operations inject a modified ground water solution into the orebody, where it dissolves the uranium and is pumped back to the surface. The uranium-rich solution is then sent to a processing plant where it is concentrated and dried into yellow cake.
Ur-Energy estimates it would cost US$30 million to build a 2-million-tonne-per-year plant and with US$38.5 million sitting in the company’s coffers before the latest private placement, it says it has the cash it needs for production, which it expects to start in 2011.
The latest permit enables Ur-Energy to build and operate two water-holding ponds for water management at the site.
Combined with the injection well permits, the company says it is moving towards finalizing all permitting. The final permits are in the hands of the U.S. Nuclear Regulatory Commission and the Land Quality division of the Wyoming Department of Environmental Quality.
“I am looking forward to completing work on the remaining licenses and permits with the various state and federal regulatory agencies over the coming months,” Wayne Heili, Ur-Energy’s vice-president of mining and engineering, said in a statement.
Lost Creek has an indicated resource of 8.5 million tonnes grading 0.058% UO8 for 9.8 million lbs. U3O8, and an inferred resource of 700,000 tonnes of 0.076% U3O8 for 1.1 million lbs. U3O8.
The company expects to produce U3O8 at a rate of 1 million lbs. per year for a minimum of 6.5 years. It says the site has significant exploration upside and it expects to find additional resources.
Leach efficiency at the plant is estimated at 80%, which is above the industry average of roughly 70%, while cash costs are expected within the US$35 to US$38 per lb. range.
The mine would be a big winner if uranium prices can break out of their protracted slump in the US$40 to US$45 per lb. range.
The company is looking to domestic demand to fuel an appetite for its product and it points out that while the U.S. generates 20% of its energy from nuclear power, it currently only produces 7% of the uranium it uses.
On the global scene, plans to double the 436 nuclear reactors that are currently in operation could well improve uranium prices in the coming years.
On news of the latest permit the company’s shares were flat at 97¢ on roughly 88,000 shares traded. Ur-Energy has 93.9 million shares outstanding.
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