Comments: I agree, we have said NO, get lost VUI, VER and all Canadian mining companies! Price of u: US$35.60/lb
Game, set and match for VUI?( Uranium Mining)The Editorial Board | Posted: Sunday, February 2, 2014 7:00 am
At this time of the year, the General Assembly is in session. If both houses of the legislature were to pass a bill allowing uranium mining to proceed in Virginia and Gov. Terry McAuliffe were to sign it, it would still take five years or more before mining could start at Coles Hill in Pittsylvania County.
Of course, none of that is going to happen.
Since Virginia Uranium Inc. announced its plans in 2007, no uranium mining bills have passed the General Assembly.
During that time, counties, cities and towns have come out against uranium mining, including those is the Dan River Region. They have been joined by a unique coalition of business and environmental groups and now Gov. McAuliffe, who has pledged not to sign any uranium mining bill that passed the General Assembly.
From a political standpoint, uranium mining in Virginia is dead, killed off in part by some of the very scientific studies VUI said it wanted to allay the public’s concerns.
But we learned this week that the project may no longer be economically viable because of falling uranium prices.
Those prices fluctuate, sometimes wildly, but at this time, the price for a pound of uranium has fallen to around $50 — not the $64 per pound VUI needs to make its Pittsylvania County project viable.
"There is no guarantee the proposed operation would be economically viable given the uncertainty of future uranium prices in combination with permitting risk related to the current moratorium on uranium mining," according to one report.
The volatility of uranium prices was one of the arguments mining opponents had: if Virginia had allowed the mining of uranium in Pittsylvania County, what would have happened to that mine if the price of uranium dropped below a certain point?
The company probably would have drastically curtailed its operations — or even shut down its mine and mill for months or even years at a time.
"It’s very well-known that the long-term price of uranium will [rise]," Virginia Uranium Inc. President Walter Coles Sr. responded. "The long-term outlook is very positive."
We don’t agree with Coles on this.
There has been an energy revolution in this country, but it hasn’t been the "nuclear renaissance" predicted in 2007.
Natural gas, not nuclear power, has become the energy story of the past few years. There’s a great push to expand the use of renewable energy sources, and energy conservation has made a big difference in the long-term demand for electric power in this country.
The people have spoken, and they don’t want uranium mined in Pittsylvania County. The market has spoken, and it doesn’t need uranium from Pittsylvania County.
Is VUI finally ready to listen?
Tough times for VUI?(Boo-Hoo)By BRITTANY HUGHES email@example.com (434) 791-7983 | Posted: Friday, January 31, 2014 12:00 am
A continued drop in the projected long-term price of uranium — combined with Gov. Terry McAuliffe’s recent statements affirming his opposition to uranium mining — has been a one-two punch to uranium mining efforts in Virginia.
Virginia Uranium Inc. recently announced it would not pursue legislation in the 2014 General Assembly that would have drafted regulations for uranium mining in the state. While Virginia’s moratorium on the practice would have remained in place, the move would have been a huge step toward the company’s goal of mining a 119-million-pound uranium ore deposit on Coles Hill in Pittsylvania County.
Shortly after McAuliffe’s election, the new governor announced he planned to veto any such legislation that might pass the General Assembly. The move prompted VUI to stall legislative efforts and “re-evaluate [their] options” moving forward.
But legislative hurdles aren’t the only concern facing the company.
According to the most recent data, declines in the global price of uranium may also affect the mining conglomerate’s future plans.
Uranium prices are calculated in two ways: the “spot price” — or the price the uranium can be sold at any given moment — and long-term price. Like many companies across multiple industries, VUI’s project summary is based on the assumed long-term price of uranium.
According to Cameco Resources, the largest uranium producer in the country, uranium’s long-term price is currently projected to be $50 per pound.
But the most recent preliminary economic assessment of the Coles Hill project bases the site’s entire economic potential on an assumed $64-per-pound uranium value — well below current predictions.
“There is no guarantee the proposed operation would be economically viable given the uncertainty of future uranium prices in combination with permitting risk related to the current moratorium on uranium mining,” the report adds.
The assessment was included in a quarterly management analysis released in November by Virginia Energy Resources, VUI’s parent company.
When Virginia Uranium Inc. was founded in 2006, uranium prices were on the rise — reaching as high as $95 per pound throughout 2007.
But the price of uranium began dropping steadily in April 2011, one month after an earthquake and subsequent tsunami triggered a major disaster at the Fukushima I Nuclear Power Plant in Japan.
The price has hovered around $50 per pound since September, and has remained below VUI’s desired price of at least $60 since October 2012. (Hence TradeTech's weekly spot price indicator finished down US40c to US$35.60/lb )
In the meantime, the company’s only revenue at the Coles Hill site currently stems from interest on cash and land rental, according to the management analysis report.
But the economic assessment doesn’t paint an entirely positive picture of VUI’s future, stating the “company’s ability to continue … is dependent on [its] ability to raise additional equity financing and the ultimate attainment of profitable operations.”
The report also states the “company believes it has sufficient resources in combination with cost-cutting measures, to fund its planned activities for the next twelve months.”
In addition, the report acknowledges the “possibility of lifting the uranium mining moratorium will be a significant challenge” during McAuliffe’s four-year term.
To help cut down costs, Coles said VUI has made big cuts to its previous operations.
“We’ve ceased to do the technical work on the baseline studies for water and the environment, and any future [exploratory] drilling would not take place,” Coles