Easing Covid-19 risks and improved uranium fundamentals have prompted Western Uranium & Vanadium (CSE: WUC; US-OTC: WSTRF) to pull the trigger on a restart of uranium exploration development and mining at the Sunday mine complex in western San Miguel County, Colorado.
The Sunday mine complex comprises the Sunday, West Sunday, St. Jude, and Carnation mines, all of which are interconnected.
The operating base will move from St. Jude to the Sunday mine.
Western says the work aims to differentiate the facility as among the very few mines in North America able to be put into full-scale production with a negligible capital outlay and lag time.
Western says the move to active status comes in anticipation of the uranium price rising substantially over the next year or two.
The company cites positive momentum building in nuclear power generation and uranium mining based on the increased global acknowledgment that nuclear electricity generation is a scalable clean energy source of baseload power.
“Management feels that these macro trends have already initiated the next uranium bull market,” the company says in a news release.
A uranium-vanadium seam at Western Uranium’s Sunday mine complex, in western San Miguel County, Colorado. Credit: Western Uranium
Covid-19 related mine shutdowns have accelerated a global decline in supply and inventory levels. Simultaneously, nuclear fuel demand is growing from new reactor builds, Japanese reactor restarts, delayed reactor closures from operating extensions and government support, nuclear technological advances and increased end-user electricity demand are driving demand.
In June, Western agreed to buy 125,000 lb. of uranium concentrate at the current market price for delivery before the end of June 2022.
The company said the deal “has the potential to enhance the balance sheet beyond the purchase cost through uranium price appreciation,” and the physical uranium can be “held as a long-term investment.”
The decision was motivated by “an acquisition cost substantially below-average global uranium production costs,” the company stated in a news release, adding that the idea was first discussed in mid-2020 “as markets began to acknowledge the growing uranium supply-demand imbalance.”
“A decade of oversupply has stifled the development of new uranium mines, which has created an undersupply of uranium/nuclear fuel for the next decade,” it said in a press release on June 2.
The Sunday complex was fully developed in the 1970s by Union Carbide, which spent about US$50 million on the project.
Be the first to comment on "Western Uranium to restart Sunday mine complex"