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Show Gomp News File fiox 6310 Lincoln, Neb, 60506 Uranium. whifh catapulted Moab into k.,MiclinK-liglit sonic 20 years ago, is jink-coming an important factor in the ''l economy, and in the economics of Lv areas of the West. Grand County Recorder Alice McKin- . reports, by way of illustration, that rnJan. 1 through Nov. 17 last year "iere were 4.092 uranium-involved Ltniments (papers) handled by her while there have been 4.171 Jdled this vear durin8 the same period. His represents an increase of some 20 ' cent in Grand County uranium r . irtivity- Ninety-five per cent of all uranium pxluced in the United States comes from within 500 miles of the (& Junction United States Energy Research nd Development (ERDA) office uraAn!,?al f 2 P" Cent f U'S' domestic U, ,h HPwdUCtin COmes from Eastern Utah and Western Colorado. In addition cLPCr, Cemuf thC nation's mill'ng "Pacty ,s here, according to Jim Westbrook, assistant manager of the Grand junction ERDA office. Besides the Colorado Plateau and surrounding areas, the Wyoming basins and Texas coastal plain are developing uranium-producina areas. 5 Uranium production in Colorado and Utah which has enjoyed a moderate growth rate in the past few years will double in the next 5 years, projects Westbrook. He said current estimates call for a 97 per cent increase of production in 1981 over 1976; a 72 per cent increase in 1986 over 1981; a 40 per cent increase in 1991 over 1986; and a 39 per cent increase in the year 2000 over 1991. In the first half of 1976 alone total purchase commitments of uranium jumped 22 per cent from 118,400 tons to 143,900 tons. These purchasel commitments commit-ments call for delivery between 1976 and 1985. Selling Prices . Selling prices and supply of uranium have been an area of question both for producers and ERDA officials trying to read the crystal ball. Some are predicting that the first uranium shortages will crop up around 1981-82. Eugene Grutt Jr., Manager of the ERDA Grand Junction office says, "It's not a question of whether there is ore in the ground but of the production capacity of the mines and the mills and how rapidly they can develop the uranium reserves." With rising prices, there might not be enough money to keep the industry expanding as fast as demand, considering consider-ing that uranium prices have jumped from about $6 per pound four years ago to a going rate of about $40 per pound. One ERDA official quipped, "If it goes to $100 a pound, why sell it for $40?" This brings up the possibility of some companies sitting on their uranium supplies waiting for prices to go higher. Another confusing aspect of the uranium picture today is the prices being batted around by producers, consumers and ERDA. A recent ERDA news release sets the average 1976 price per pound for uranium at $12.05. When this is compared with the popular $40 per pound . price used elsewhere, the discrepancy starts one wondering what is going on. In explaining this discrepancy, a Washington statistical expert for ERDA explained that the $12.05 price is an average for all material under contract to be delivered this year, and that some of these contracts go back to the late 1960's. While the current selling price for uranium is about $40 per pound, he explained that only 1 per cent of the uranium being delivered this year is being sold within the $35 to $40 per pound range. A total of 47 per cent of uranium being delivered this year had been contracted for at a price below $10 per pound, he explained; and this is why the average figure for deliveries in 1976 is so low. Procurement Methods He also explained that as the uranium Continued on Pg. A2 Uranium... Continued From Pg. A1 industry is maturing, different methods i of procurement have developed aside a from the traditional contract price a method. Contracting for deliveries based a on the current market price of uranium at a the time of delivery is becoming more and a more popular in the industry, he indicated. Because of this, it is difficult to predict the price of a growing proportion of the uranium contracted to be delivered in the future. Another method of procurement which is growing in popularity is a method by which the purchasing company agrees to participate in exploration, in production andor milling with the company owning the reserves. Financial arrangements are worked out by contract between the two partners, and vary widely in their provisions. One such agreement was made recently between Mineral Energy, Inc., an Orem firm, and Energy Fuels Ltd., a Denver firm, for development of uranium claims. The agreement calls for cooperative efforts in exploration and engineering of mining claims in San Juan, Garfield and Wayne counties either owned or leased by Mineral Energy, Inc. One of the terms of the agreement calls for a "miners assistance" program, a new twist on the old "grub staking," which would provide geology, drilling, engineering and financial assistance on call from Mineral Energy. Following this agreement trading in Mineral Energy stock rose sharply on the stock exchange, from bid prices of 9.5 cents to as high as 22 cents. a Reserves a The amounts of reserves and rate of consumption of reserves is an area of f 1 more worry to many in the industrT ' Preliminary figures comparing how mudi uranium the U.S. has with how much will need are the source of the worry 1 The nation has 640,000 tons of known 1 uranium reserves currently. This should 1 last about 15 years at the current rate of comsumption, says the U.S. GeoloBi,i 1 Survey. ( Potential reserves are divided int0 three classifications: probable, possible and speculative. Together they total 2 9 million tons. All told, it is believed the U.S. has 3.5 million tons of uranium, both 1 known and potential reserves in addition, there are more conservative estimates which place that total at about 1.7 million tons of domestic uranium K, I 1990. y , The uranium industry is expected to produce about 13,500 tons of uranium this year. It will need to produce 50,000 to 60,000 tons annually by 1990 to keep up with projected demand, and many l companies are doing the groundwork needed now to attempt to meet that ' need. American Nuclear Corp., Casper i Wyo., expects to spend double the i amount in exploration in 1977 than it did this year, over $6 million total. American is also developing plans for an additional t $4 million exploration and development program in fiscal 1977, according to , company president Cotter Ferguson. As a result of this development work . to be completed in conjunction with co-interest owners in uranium properties the company expects to be producing about 500 tons annually in about 18 to 20 months. i |