The US Geological Survey (USGS) says it estimates that 40 million pounds of uranium oxide remain as an undiscovered resource in the Southern High Plains region of the US.
The area stretches across New Mexico to Northern Texas and Western Oklahoma, and the assessment conducted by the USGS is divided into a northern and souther portion; the southern portion is estimated to hold 80 percent of the undiscovered resource.
“Texas is well-known for its energy potential, from petroleum to wind to uranium,” said Walter Guidroz, coordinator for the USGS Energy Resources Program. “In fact, in 2015, we released another assessment of uranium in South Texas, where we estimated a mean of about 5 years of U.S. uranium needs.”
The US currently obtains 19 percent of its electricity from nuclear power plants, but only 11 percent of the uranium purchased by nuclear power reactors in 2016 was from domestic sources.
The uranium in the Southern High Plains region occurs in a type of rock formation called calcrete. The formations described in the USGS report are the first uranium-bearing calcrete deposits documented in the US. According to the organization, these formations are well documented in other countries such as Australia and Namibia.
The USGS assessment of the Southern High Plains region also resulted in the discovery of a new uranium mineral species in Texas. The new uranium mineral is called finchite, and is a combination of strontium, uranium, vanadium and water; it is a potential source of mineable uranium ore.
USGS scientist and report co-author Brad Van Gosen said the calcrete uranium deposits in the Southern High Plains region have the advantage of having shallow depth and soft host rock. “These qualities work well for open-pit mining, assuming uranium prices and other factors are favorable,” Gosen said.
As of November 6, the U3O8 spot price was at $20.25 per pound, up 30 cents from the previous week. The market got a jolt last week when top producer Cameco (TSX:CCO,NYSE:CCJ) announced plans to cut production at its McArthur River mine and Key Lake milling operations.
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Securities Disclosure: I, Melissa Shaw, hold no direct investment interest in any company mentioned in this article.