The Uranium Producers of America (UPA) was formed over twenty years ago. Over
the years, this professional association worked with Congress and state
legislators to help improve the front-end of the fuel cycle: uranium
mining. Today, it is re-energized with new members and to contribute to the U.S. uranium mining sector rebuild with this task. We spoke to Jon Indall, a lawyer based in Santa Fe, New Mexico, which serves as the Executive Director of the UPA.
Uranium
Producers of America members include International Uranium Corporation,
power resources, Uranium Resources, Cotter Corporation, Energy Metals
Corporation, Mestena Uranium, U.S. Energy, Laramide Resources,
Strathmore Minerals, Uranium Energy and Neutron Energy.
StockInterview: What is the function of the Uranium Producers of America (UPA)?
Jon
Indall: Uranium Producers of America is a professional association,
originally founded in 1985 to promote the viability of the domestic
uranium industry.
StockInterview: How did the UPA association created?
Jon
Indall: The UPA was initially founded by the great American producers
such as Kerr McGee, Homestake, United Nuclear, Rocky Mountain Energy,
Union Carbide, Atlas, and Pathfinder. The main operating companies decided to form to focus on specific uranium viability issues. Their own group
StockInterview: How does the UPA differ from the National Mining Association regarding the uranium industry?
Jon
Indall: Over the years the UPA was sort of an institution lobbying for
the domestic industry and the viability handled such issues. The National Mining Association has a uranium environmental subcommittee. The NMA is more involved in the regulatory aspect, but we work together and have a good relationship. There is certainly an overlap between the members of each group, but our cargo has been more on the viability aspect.
StockInterview: How do you promote the viability of the domestic uranium industry?
Jon Indall: Our agenda is twofold. We want to continue to promote. Viability of uranium production in the United States In that spirit, we have met with the Department of Energy (DOE) to explain what is going on in the field. We let them know that active companies pursuing mining, acquiring properties, doing the exploration and development, and so on. We are also urging DOE not to do something that affects the market.
StockInterview: How could the Department of Energy affect the uranium market?
Jon Indall: The Department of Energy is sitting on a lot of inventory. We DO want to be in the way they use that material wisely. There is a very solid opportunity, in our opinion, going a few years, there is a gap between available supply and demand. Decreases the secondary market. We want to keep DOE. Their material against If there is a shortage, they can ride to the rescue, and the reactors will not go cold.
StockInterview:
Are the utilities going to get back into the sector domestic uranium
for their nuclear reactors provide sufficient uranium available?
Jon Indall: In the 1970s, when we first tree, domestic utilities were out making deals with producers. They were to invest in projects and things of that nature. Actively I do not think that will happen this year or next year. But a few years when things really tighten up, you could see that. Down the line,
Stock Interview: Where do the U.S. utilities are related to a domestic uranium industry?
Jon
Indall: In the late 1980s and early 1990s, I think the utilities saw
Canada as such a big production center, they lost interest in the
domestic producers. They were not too concerned about having enough fuel coming in.
StockInterview: But, the industry has not changed in the past few years, as the spot price of uranium has risen?
Jon
Indall: If you can see, with the impetus that is going on in Asia and
all reactors under construction or planned, the press and everything
else to read, I think the utilities have to understand that supply is
something they should pay attention to. It is to talk to the utilities a little more seriously on our agenda. Even though you can get this stuff from other places, it's nice to have a local producer. It's pretty obvious this industry in the next four to five years, could produce in the range of 20 million pounds.
StockInterview: Do you believe that the domestic uranium industry can produce 20 million pounds in the next four to five years?
Jon Indall: Conservative, five to six years, but perhaps even earlier. Well, let me put it this way: We produce about 3 million pounds now. That is an increase of two. I could be off by a factor of a few hundred thousand. Power Resources produces about 2 million pounds. With the Uranium Resources production that has come up in Texas, and Mestena, you have about a million pounds or so. IUS has just announced that they are going to produce 3.5 million pounds, I think the next two years. Part of that material they clean up for DOE, but it is still in production. All the UPA members have plans to put into production at some point.
Stock Interview: Yes, but not take 5-11 years to get production going?
Jon Indall: I think eleven years is too far away. I
think that if the companies can come up with it, you have four or five
In Situ Recovery (ISR) activities to the production of a £ 2 million
each. And then maybe somebody gets a conventional resume, just like me here IUS does. I
can not tell you the exact number, but I think you will see increased
production, assuming that the price continues to rise or stabilize.
StockInterview: How are the uranium companies are moving quickly?
Jon Indall: I think a lot of it, in my mind, is how well the regulatory community accepts what these guys are trying to do. My
impression is - and this is just me talking - that many of the
communities where this activity is carried out before, are not averse to
see again. It does a good job and stuff. Many of these communities are kind of depressed communities. For example, in New Mexico, McKinley County is one of the lowest counties in the state economically. I think the average man would welcome the opportunity to. Seeing some good paying jobs there
StockInterview: How well would the regulatory community in New Mexico react?
Jon Indall: I recently met with the New Mexico Mining Minerals Division. As we passed the New Mexico Mining Act in 1993, no one allowed my in New Mexico. We talked about how we were going to do this. Obviously it is not going to happen tomorrow.
StockInterview: What about senior government officials, including the governor of New Mexico?
Jon Indall: I can tell you the New Mexico governor was very positive about the uranium miners when he was in Congress. He introduced legislation to support our efforts in those days, and some of it he did on his own. He has a great ability to govern, and I think he's looking for jobs. I think if we can show that we can do this better than we did in the past him then he will be supportive. That is my hope.
StockInterview: Will the big oil and mining companies to return to the uranium industry back?
Jon Indall: I do not anticipate the major oil companies again for some time. BHP Billiton initially said, "We have no interest in uranium mining in New Mexico." Then she turned around and bought the largest building in Australia. Now I BHP's hard to look at their new activities Mexico understand. So you might see some of the major mining companies involved.
StockInterview: Who will build the domestic uranium industry?
Jon Indall: I think it might be more entrepreneurial, that was the way it started in the 1950s. The
early producers, with the exception of Kerr McGee, were individuals -
Charlie Stone, Dick Bokum, and Cotter Ferguson in Wyoming. They were the people who really got this industry and go with AEC assistance. I'm not sure of the oil companies that are critical, but I would like to see get utilities in the mix. I guess it all depends on how supply and demand is observed.
StockInterview:
How should the major producers of uranium, such as Cameco or BHP, deal
with the consequences of a potential supply shortage for U.S. utilities?
Jon Indall: BHP and Cameco are aggressively trying to increase their production. They should not be doing that if they do not think there was a market for it. The
U.S. market and the U.S. government are so important to the health of
all providers, in my opinion, because our government to help more and
the injury to the domestic and global production than did. Every other
entity I
think foreign producers wise to recognize that having a viable U.S.
industry, which senators and congressmen care about, because they create
jobs and income in their states, is not a bad thing. I think it keeps DOE honest. For me, if I were in Canada, this would be something I could look at his.
StockInterview: What should U.S. utilities have to look at, with respect to the supply picture?
Jon Indall: You have the Russians announce they do not intend to proceed with the HEU agreement after 2013. It is my understanding they are looking to beef supply for themselves. With the tools, I think it's kind of 'wait and see' at this time. I think they're looking at this from the big picture. I think the nuclear for them increasingly clear to play an increasing role. Global
warming is really driving many boats here, and I think they realize
there must be a real active nuclear power production increase.
StockInterview: How are things different now for the Uranium Producers of America compared to the early days in the 1980s?
Jon Indall: At present, it is a very different atmosphere than it was in 1985. The market went down quickly in 1985. Everyone was kind of fighting for their existence. We pleaded our case is that this industry was created by the government - the government did things that really screwed up. I think, now, we do not ask for so much. We are basically asking for the status quo. We do not want the government to do something that negatively affect the price. Let the price work itself out. Let's start with the production of uranium which has some cost implications. The price and the cost of having a relationship. From about 1985, they did not.
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