TELLURIDE – Energy Fuels Inc., the company looking to build the nation’s first uranium mill in nearly three decades, known as the Piñon Ridge Mill, in Paradox Valley, through its Colorado subsidiary Energy Fuels Resources Corp., announced last week that it has been awarded a 641-acre US Department of Energy lease tract within the Uravan Mineral Belt in western San Miguel County.
The company acquired the lease through the DOE’s Uranium Leasing Program after a previous bidder dropped it. The tract is believed to contain 156,000 pounds of “historical uranium oxide resource,” and historical production records from the area indicate a “historical vanadium oxide resource” of 1.5 million pounds, according to a press release issued by the Toronto-based company, which trades on the Canadian Stock Exchange.
Those numbers came from pre-bid public information provided by the DOE and were derived from an estimate originally prepared by the Atomic Energy Commission based on drill samples taken in the early 1950s.
“The DOE confirmed that there was uranium mineralization in this lease tract,” said Energy Fuels President and CEO Steve Antony.
“The resource has the potential to be mill feed for the Piñon Ridge Mill.”
But for those who have been following Energy Fuels’ progress as it goes through the radioactive materials licensing process with the Colorado Department of Public Health and Environment, which has until next January to determine whether or not it will issue the permit, a perhaps more interesting item was found further down in the statement.
There the company announced it had obtained the consulting services of nuclear industry veteran Richard Cherry, president and CEO of the Cotter Corp. from 2000 to 2006, to support the company’s “consolidation strategy in the western USA and product marketing effort.”
Cotter is an affiliate of General Atomics, whose CEO is former Telluride Valley Floor owner Neal Blue.
“As we move toward the January decision on our Piñon Ridge Mill license, I am pleased to have the expertise of an experienced uranium professional like Richard Cherry on our team. Richard will be working closely with me on the consolidation strategy and with Gary Steele, our Senior Vice President of Marketing, on securing long-term contracts for our uranium products. We have seen the spot price for uranium strengthen over recent months and securing forward looking contracts will help us build on that momentum,” said Antony in the press release.
At least one critic of the proposed mill, noting its location adjacent to an open pit uranium mine owned by Cotter, has alleged in public meetings that Energy Fuels may somehow be working for or with Cotter to secure a mill permit the larger company would have difficulty of obtaining for itself because of the numerous violations it has received at its Lincoln Park uranium mill near Cañon City,
Could Cherry’s participation indicate a conspiratorial link?
“Here’s a guy that’s just a talent out there,” said Antony, dismissing the idea.
“It would be just like a guy getting another job anywhere.”
But for attorney Travis Stills, with the Durango-based Energy Minerals Law Center, who is representing local conservation group Sheep Mountain Alliance it its fight to stop the mill, the affiliation is troubling because of the numerous violations received by Cotter on Cherry’s watch.
Stills referred to testimony given by Cotter Vice President for Milling John Hamrick, before the Colorado House Transportation and Energy Committee concerning the Uranium Processing Accountability Act before it was signed into law this past June.
In that testimony Hamrick, who joined the company in 2005, referred to 99 violations received by his company between 2000 and 2010.
“I’m not here to defend that record,” Hamrick told the committee. “When you have a record like that that’s not a good record at all and it’s something that has to be acknowledged before you can make it better.”
Hamrick stated that the bulk of the violations took place before his tenure, and that since 2006 the company had received only three.
“[A]nd I would like to think that’s because of policies and changes that I have implemented at the site to help change the conditions that Cotter was working under and the relations that Cotter had with the Department of Health at that time,” he said.
“I would also like to point out that every senior manager that was responsible for the record of violations prior to 2006 either resigned, retired, or was terminated,” he continued. “There has been a complete change in senior management at Cotter and I think that if you look at our record since that time you can observe that.”
Energy Fuels has countered concerns raised by opponents about the safety of the proposed mill by noting that the industry is much better regulated than it was in the past, but for Stills the Cherry connection indicates one thing.
“Just confirms that what we’re seeing is sort of the same old uranium industry brought back around,” he said.
“It will be operated and managed by some of the same people responsible for a huge amount of contamination throughout the state.”
Antony disagreed with the logic.
“He’s not an employee, he’s not an executive in charge,” he said, explaining Cherry’s role as a part-time consultant on future uranium supply contracts, having no relationship to “[H]ow we will build this facility and operate this facility and reclaim this facility.”
Antony said his company was acting out of transparency in making Cherry’s role public.
“We could have kept these things quiet and no one would have known the difference.”