Saturday, January 20, 2007

Even more on Stathmore...

A post on StockHouse pointed out an interview with David Miller of Strathmore Minerals. I have included an excerpt below. Note the lead time involved to build a new uranium mill. Six years, just to get all the permits. I also recommend taking a look at Ralph Kettell's article from June 2004 that got me started on the sector and Strathmore in particular. It is interesting to compare his insights on what would happen over the next few years and how they have actually played out. So far, Ralph's call has been extremely good.

-theinvestar: Currently Strathmore is planning to build a mill near Grants, New Mexico. What is the timetable on the permitting process and what would construction time look like

David Miller: The real issue is getting the permit. We believe it will take 6 years to obtain an NRC and all related permits. With that, last fall we purchased a section of land in the center of the Grants Mineral Belt. Its on a paved highway, infrastructure is in place, and it even has a heavy gauge railroad nearby that comes out of one of the coal mines in the same region, so we’ve positioned it to take advantage of infrastructure and the location in the center of the Grants Mineral Belt. Right now utilities have their uranium supplies for the next 2 or 3 years. It’s that period from 2012 and beyond when new power plants around the world are going to need their initial feeds and then are going to start consuming more and more uranium. 2012 and beyond is when the consumption of uranium is going to start growing dramatically. The mill should receive a license and can be constructed when the big shortages are going to occur.

-theinvestar: What projects are your most advanced, and when are you expecting to open your first mine?

David Miller: Our most advanced is probably Roca Honda in New Mexico. It was permitted and even had a shaft sunk on a nearby property in the late 70s, early 80s. It was Kerr McGee’s next mine they were developing to feed the largest mill in the world in Ambrosia Lake, which BHP Billiton tore down 3 years ago. In the Gas Hills of Wyoming, we own 3 projects that are probably capable of being fully permitted in 24 months, but these would be smaller open-pit mining operations, and it would be the $Sweetwater Mill that we would need a toll milling agreement with. We are also permitting several ISR projects in Wyoming and we are starting a number of other initiatives on some of our other advanced resources in Wyoming.

-theinvestar: When you look at Strathmore, what part of the company would you say sets you apart from other uranium companies?

David Miller: The acquisition of the Kerr McGee properties in New Mexico along with the Kerr McGee data base is the biggest thing. They made an early decision to abandon the sector because of its collapsed due to the cancellation of so many nuclear power plants in the 1980s. We recognized from day one that the sector had been abandoned and there were no big companies out there waiting around to pick up uranium projects that companies can be successful with. We recognized this early on and were the first company to open a permit office in New Mexico, the first to start the permitting process on a mill in New Mexico, and we realized that we have to help reinvent the industry. We staffed up early and have over 200 years of uranium experience in our management team. Few companies have that expertise available.

The Investar blog

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