In Situ Uranium Leaching

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Here is a way-out mining investment opportunity: in situ mining of uranium. It is being done, and, optimist that I am, I suspect it will be done more often in the future. I cannot tell you that one or other company will be able to make enough money from in situ uranium mining to make you rich, but I can sketch out some of the technical issues you should evaluate before buying stock in in situ uranium leaching ventures.

I do not dwell on the first and most obvious danger that a new in situ uranium venture will loose money: namely, that it is easy and cheap to get uranium out of those mines in Saskatchewan---they are doing it now and there is minimal public opposition. Conversely try to persuade a Colorado granola that his groundwater is protected by your team of Georgian hydrogeologists and see how far you get.

The process of in situ uranium leaching is, superficially, terribly simple. You simply pump water into the ground and then pump it out again. If there is enough uranium in the ground, the water you pump out will have lots of uranium in it. And you can get that uranium out by conventional processes. If you are smart, this is mining without those pesky open pits or waste dumps.

It is no wonder many are doing it, and many more are proposing to do it.

The key to successful in situ uranium mining, in my opinion, is a team of brilliant geologists and hydrogeologists. In particular they must be near geniuses in the theory and practice of groundwater flow. Let me explain.

Getting water into the uranium-bearing rock is easy: drill a hole, insert slotted casing, and then pump in water. From this first simple step, everything else is complex. By its very nature, soils and rocks bearing uranium are heterogeneous. This means the injected water will go where-ever it pleases, generally in an un-anticipatable direction.

To control this essentially random flow regime, extraction wells will be installed and the groundwater, and uranium, pumped out. It's like a kid with a straw in an ice-cream sundae---if you suck hard enough most of it comes out eventually although you would probably rather not know how---and the end result may be a mess.

That is where the geologists and groundwater hydrologist come in. They claim to be able to characterize, model, predict, and control this process. They can too, if they are good. But if they are bad (incompetent rather than evil) the result is a mess—just like my ice cream analogy.

One measure of the growing popularity of in situ leaching of uranium is that the United States Nuclear Regulatory Commission (NRC) has run out of staff to review the applications to undertake such mining. I quote from a recent report:

"The NRC currently expects to receive 20 applications for new uranium recovery operations and 10 applications for expansion or restart of existing facilities through 2011. Most of them will be in Wyoming or New Mexico. About 75 percent of them are expected to be for in-situ leach operations. By addressing common issues associated with environmental reviews of these facilities, the NRC staff plans to use the generic environmental impact statement (GEIS) as a starting point for its site-specific environmental analyses of individual license applications or as a supplement to previous environmental analyses of existing sites. A reasonable translation is that the NRC simply hasn't got enough people to get their arms wrapped around every application in every detail."

The idea of a generic environmental impact statement is good, but fraught with danger. The first problem is that it gives opponents a perfect legal hook to claim that the real issues were not addressed.

While simple minded engineers like me might agree that generic is good enough, where in the world will you find a groundwater hydrologist who would stake their reputation on a conclusion that a generic study of groundwater is OK?

I have been honored to work with groundwater professionals almost since the profession was invented. At one time I even had a boss who wanted to make me into a groundwater engineer. Not once have I worked with a groundwater professional who did not demand another round of drilling, sampling, testing, and modeling. To denigrate all past work characterizing the groundwater flow regime is a badge of honor amongst the groundwater folk. And that rule hold true regardless of whether the previous work was by a competitor or by their own hand.

Thus the in situ uranium mining industry should brace for a period of frustration as it tries to get a generic answer from a groundwater professional, get approval of a generic impact statement from the NRC, and duck the lawyers armed with professional alarm. I would not bet on any of it happening soon—other than the demands for more groundwater data from all concerned.

To summarize: buy share in in situ uranium mining stock if: they have superb geologists and groundwater hydrologists; they can avoid the generic; there are not in Colorado; they have belligerent lawyers; and there is lots of uranium where they plan to inject.