Northern Colorado Business Report
by Steve Porter
October 1, 2007 -- WELD COUNTY - A review of mining leases filed with the Weld County recorder's office reveals at least three additional uranium companies are showing interest in the county by entering into lease agreements with local landowners.
The leases indicate that Powertech USA, with a controversial uranium prospect near Nunn, is not alone in its quest to cash in on soaring uranium prices.
New players in the Weld uranium rush include companies based in the United States, Canada and Australia.
Geovic Energy Corp., a Grand Junction-based subsidiary of Geovic Mining Corp. of Vancouver, British Columbia, signed 56 mining leases with owners of property in Weld County between April 30 and Aug. 27, according to a records search.
Also interested in Weld County are Black Range Minerals, based in Perth, Australia; Vancouver-based Energy Metals Corp.; and Contex Energy Co., a land brokerage company headquartered in Denver.
Lane Douglas, director of Powertech's Centennial Project in Weld County, said the companies are among numerous others that are taking an interest in Colorado's uranium deposits.
"Our friendly competition is lining up behind us to see how we do," Douglas said. "It's obvious they're letting us take the lead on it, and why shouldn't they?"
Powertech's drilling rigs are now digging baseline monitoring wells on its leased land. If all goes well and Powertech receives permission from the state to begin mining in a 6,000-acre area in which it has acquired mineral rights, uranium extraction could begin as soon as 2010.
The other mining leases are for property throughout northern Weld County, including areas near Grover and Briggsdale.
While uranium prospecting has occurred periodically in Weld County over the last 50 years, an expected uranium boom in the late 1970s went bust after the Three-Mile Island nuclear power accident and a leveling off in the production of nuclear-missile warheads.
But a resurgence in nuclear power around the world has caused the value of uranium to spike in the last few years, with mining companies dusting off historic records to stake claims on potential production sites.
Douglas said that's resulting in "fierce competition" for mining claims in Colorado, with more than 3,000 filed statewide over the last 18 months.
Douglas said Powertech purchased "some" of the nine mining leases Energy Metals had acquired in Weld County. That transaction, which took place July 19, was just before Energy Metals was acquired by Toronto-based Uranium One Inc. Aug. 10.
Calls to Uranium One to find out if the company planned to pursue uranium mining in Weld County were not returned.
Uranium One has "extensive property holdings in Wyoming, Texas, Utah and New Mexico," according to its Web site.
Land brokerage firm Contex Energy Co. has been brokering oil and gas leases in Weld County since 1990 but added uranium mining leases to its services this year when it obtained seven mining leases between May 21 and June 11.
Ken Harris, consulting landman for Contex, said his company has been pursuing the leases on behalf of companies he preferred not to identify.
"It's kind of a mix of companies," he said. "We work on behalf of our clients, and they make the decisions where they feel prospecting might be beneficial, and we go from there."
Black Range Minerals signed six memoranda of agreement with Weld County landowners between May 4 and July 5. Mike Haynes, Black Range managing director, said the company is currently focusing more of its attention on "minerals projects" in the United States, including Weld County.
"This project is what we would regard as an 'early stage' project, meaning considerable evaluation and extensive exploration would need to be undertaken over a relatively long period of time to determine whether there may be any mineralization on the project," Haynes said.
Black Range's primary U.S. uranium exploration project is the Taylor Ranch Project near Cañon City. The company also has three active exploration projects in Wyoming. None is yet to the extraction phase, Haynes said.
Geovic interest 'speculative'
But the biggest interest in Weld County uranium is being shown by Geovic Energy, with its 56 leases signed over the summer. By comparison, Powertech has signed six mining leases with local landowners.
Geovic calls itself "the cobalt company" because of its main focus on cobalt mining in Cameroon, Africa. William Buckovic, Geovic's president and founder, insists the company's interest in doing any uranium mining locally remains "highly speculative."
"We've been trying to pick up some leases and things, but nothing serious," he said. "Determining the mineral ownership in that county is very tough," Buckovic said from his Grand Junction office. "We're attempting to get a land package together, but we may never do anything out there."
Buckovic said he's aware of Powertech's headstart in the area. "Powertech has the (historic) data and engineering studies, so they're proceeding ahead."
Buckovic said Geovic's focus will continue to be on mining cobalt. Cobalt is used for the production of batteries used in cell phones, computers, portable tools and hybrid vehicles and the construction of jet engines.
"It's a big project that takes 90 percent of our time," he said. "These other things are very minor."
Powertech has said 75 to 100 jobs may be created if it gets permission to begin uranium mining, with an estimated $700,000 in severance taxes flowing annually into Weld County's budget.
Larry Burkhardt, president and CEO of Upstate Colorado Economic Development, said the Weld County organization does not have an official position on whether uranium mining would be good for the county's economy even though it would create jobs.
"That's what we're in the business of doing - bringing in jobs," he said. "So job growth in general is a good thing."
Noting that there are an estimated 14,000 oil and gas wells in Weld County that add a substantial amount to the county's tax base, Burkhardt said extraction of the county's natural resources in general would have to be considered beneficial.
But he sidestepped the question of whether uranium mining in particular would be good for the county's job base and economy.
"In this particular area, the applicants will have the opportunity to be subjected to all kinds of reviews by various government agencies, and they're the ones who will have to decide if it's a good thing or not," he said.