New deposits of uranium found in South Texas but low prices remain a challenge
December 8, 2015 (Source: San Antonio Business Journal) — The rolling hills just south of San Antonio may have more than triple the amount of uranium than previously believed but prices for the radioactive ore may need to move much higher before any new mining takes place.
The U.S. Geological Survey released a report last week stating that geologists had previously identified 60 million pounds of uranium oxide under the rolling South Texas plains but now believe there may be an additional 200 million pounds of reserves.
Maps from the study show that the previously undiscovered uranium reserves are in sandstone formations stretching from Karnes and Goliad counties to Zapata and Starr counties along the U.S.-Mexico border.
Uranium is the key component for fuel at nuclear power plants. According to the study, the 100 operating nuclear reactors in the United States consumed nearly 53 million pounds of uranium oxide in 2014, of which more than 90 percent was imported.
If properly mined, USGS officials reported that the 60 million pounds of previously identified uranium reserves in South Texas could provide up to one year’s worth of fuel for American nuclear power plants.
USGS officials said that the 200 million pounds of previously undiscovered reserves, if proven and produced, could add another four years of nuclear fuel for the United States, bringing the total potential to about five years of domestic supply.
But market data shows that it may be some time before any significant increase of uranium mining takes place in Texas.
Lower demand from Japan and subsequently lower commodity prices have had a strong and negative effect on mining. Figures from the U.S. Energy Information Administration show that uranium mining activity is at a 10-year low in the United States.
In the Lone Star State, the Texas Commission on Environmental Quality reported that nine companies are licensed to operate 16 facilities involving either uranium mining or processing. Five of those facilities, however, were listed on “standby” for higher prices to return while two others were listed as “abandoned.”
Corpus Christi-based Uranium Energy Corp. (NYSE: UEC) remains active in South Texas, where it owns uranium mines in Goliad, Karnes, Live Oak, Bee and Goliad counties, as well as the Hobson Processing Plant in Karnes County, which is the only uranium processing facility that remains in operation in Texas at this time.
Regardless of prices, exploration for new deposits of the uranium continues. The Railroad Commission of Texas reports that it has 13 uranium exploration permits issued to Uranium Energy Corp. and four other companies. All of the exploration sites are in South Texas.
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Raj Shah has professional experience working for over a half a dozen years at financial firms such as Merrill Lynch and First Allied Securities Inc., ... <Read more about Raj Shah>