U.S.REPORT Uranium Resources plans production

Planning to increase annual production capacity from one million to more than four million pounds in the near future, Uranium Resources (TSE) has borrowed $23 million from Citibank. The 6-year credit agreement carries a prime plus 1/2% interest rate. Uranium Resources will use some of the money to repay a $9.6-million debt. The remainder, along with $4.1 million in equity financing, will be put toward “development of our New Mexico reserves over the next two to three years,” said President Raymond Larson. Citing improvements in the uranium market and a projected increase in sales and production, Larson believes the company can “obtain additional long-term sales contracts and increase annual production capacity.”

Meanwhile, low prices have wiped out uranium mining in New Mexico. The state, which had 55 mines operating in 1978, saw its last mine close earlier this year.

Uranium Resources currently produces uranium in south Texas, using low cost in situ mining techniques, and sells its production to electric companies. Most of the sales are tied to 5- to 8-year contracts.