The Conversation (0)
Feb. 25, 2016 04:25PM PST
US uranium production dropped to its lowest level in 10 years in 2015.
A recent US Energy Information Administration (EIA) report highlights that in 2015, US uranium production dropped to its lowest in 10 years. Meanwhile, Q4 uranium output in the US was the lowest since 2002.
More specifically, EIA figures show that in Q4 2015, the US produced 585,048 pounds of U3O8, a whopping 24 percent lower than the previous quarter, and 46 percent lower than the same period in 2014. And between the first and final quarters of 2015, there was a 49-percent drop in production.
Looking at 2015 as a whole, US uranium production reached 3,303,977 pounds of U3O8. That’s 32 percent less than the 4,891,1332 pounds of U3O8 produced in 2014; it’s also the lowest production in the US since 2005. The EIA notes that the US’ 2015 production amounted to just 7 percent of the anticipated demand from US civilian nuclear power reactors.
Image courtesy of the International Energy Agency.
In terms of where all of that uranium came from, the EIA states that during Q4 2015, four US production centers were in operation, including Cameco’s (TSX:CCO,NYSE:CCJ) Nebraska-based Crow Butte operation and Wyoming-based Smith Ranch-Highland operation. The others in operation were Ur-Energy’s (TSX:URE,NYSEMKT:URG) Lost Creek operation and Energy Fuels‘ (TSX:EFR,NYSEMKT:UUUU) Nichols Ranch operation. Those facilities are all in-situ leach operations.
By comparison, those four operations plus three others were up and running during Q3 2015: the White Mesa mill in Utah, the Hobson in-situ recovery plant/La Palangana in Texas and the Willow Creek project in Wyoming. Furthermore, the IEA notes that Strata Energy’s Ross central processing plant in Wyoming became operational during Q4 2015; however, it was not producing at that time.
Are uranium prices to blame?
The EIA points in its report to the “continued low market price of uranium” as a key reason behind the slump in US production in 2015. And rightly so.
Since the 2011 Fukushima disaster, uranium prices have struggled to maintain any significant gains. Spot prices are currently trading at $33.50 per pound of U3O8, roughly 40 percent lower than in March 2011. And unfortunately, relief may not be coming soon — earlier this month, Cameco CEO Tim Gitzel warned that a recovery to the slumping industry may not be as imminent as many are hoping.
Still, as while uranium prices remain low, ultimately the supply shortfall predicted by market watchers will arrive. When that happens, investors are likely to see a sharp increase in prices, and that will give companies some incentive to start producing more uranium. “Long-term, we know good things are in store,” Gitzel said.
Securities Disclosure: I, Vivien Diniz, hold no investment interest in any company mentioned in this article.
Featured Energy Investing Stocks
Investor Insight
Generation Uranium offers investors high-leverage exposure to a potential major discovery in Canada’s underexplored and resource-rich Thelon Basin, led by a management team with a proven track record of securing high-value exits.
Overview
Generation Uranium (CSE:GEN, OTCQB:GENR, FRA:W85) is a Canadian exploration company focused on wealth creation through discovery within the uranium sector. The company’s primary strategy is to build a high-caliber exploration team that can rapidly test and drill high-potential targets, de-risking projects for potential takeover by larger producers. Currently centered in the prolific Thelon and Angikuni Basins of Nunavut, the company is also actively evaluating additional project acquisitions in the Athabasca Basin to expand its portfolio.
The company is led by a veteran management team with nearly 30 years of experience in mineral development. CEO Michael Collins has a significant track record of building and exiting public companies, including the co-founding of Bluerock Resources, a conventional uranium producer during the 2000-2008 cycle. This expertise is paired with a focused business model that leverages modern geophysical targeting to accelerate exploration timelines and reduce costs, ensuring the company can deliver results quickly in a bullish uranium market.
Company Highlights
- Strategic Location in a Premier Uranium District: The flagship Yath Project is located in Nunavut’s Thelon Basin, contiguous to ATHA Energy’s Angilak Project, which hosts the high-grade Lac 50 deposit.
- High-Grade Discovery Potential: Historical surface sampling at the Yath Project has yielded exceptional uranium grades, including boulders testing at 9.81 percent, 3.95 percent, and 2.14 percent U3O8.
- Expert Management with Exit Experience: Led by CEO Michael Collins, the team has decades of experience in mineral exploration and a history of co-founding companies that were later acquired, such as Prime Mining and Nuclear Fuels.
- Low-Cost, Rapid Exploration Strategy: By leveraging modern geophysics and extensive historical data, the company aims for a "short road to discovery," de-risking projects quickly to maximize shareholder value.
- Bullish Market Fundamentals: Generation Uranium is well-positioned to meet the growing global demand for carbon-free nuclear power, supported by a projected supply deficit and increased interest from major tech companies seeking clean energy.
Key Project
Yath Project - Nunavut, Canada
The Yath Project is Generation Uranium’s flagship project. This 100 percent owned property covers about 120 square kilometers within the underexplored Thelon Basin in Nunavut, Canada. The project is located where the Yathkyed and Angikuni sub-basins meet, which is a region known globally for high-grade uranium potential. It sits directly along the same trend as the Angilak Project owned by ATHA Energy (TSXV:SASK, OTCQB:SASFK, FWB:XSU.F), which contains the Lac 50 deposit, one of the highest-grade uranium resources found outside of the Athabasca Basin with a historical mineral resource estimate of 43.3M lbs at an average grade of 0.69 percent U3O8.
The Yath Project is contiguous to the Lac 50 trend and is crossed by several regional faults and basin boundaries. Past exploration work has already identified high priority targets, while surface sampling in the area has produced uranium grades from boulders, with some testing at 9.81 percent, 3.95 percent, and 2.14 percent U3O8.
The company has commenced its initial field program at the site, set to define and rank drill targets. Historic showings will be combined with new anomalies from the MMT geophysics survey, preparing the project for an anticipated drill permit.
Management Team
Michael Collins - CEO & Director
Michael Collins is a professional geoscientist with nearly 30 years of experience in mineral exploration. He has co-founded several public companies, including Exploits Discovery, Prime Mining (acquired in 2025), and Nuclear Fuels (merged with Premier American Uranium in 2025). He is also currently a director of First Atlantic Nickel.
Christoph Bruening - Director
Christoph Bruening is the founder and managing partner of Value Relations GmbH, a full-service investor relations and public relations agency in Frankfurt with over 25 years of excellence, focusing on mining, exploration, biotech and health care. In addition, he has listed over 600 companies on the Frankfurt Stock Exchange and is a speaker and author of several publications, including on rare earths and uranium.
Dallas Miller - Director
Dallas Miller has been working within the international mining industry for over 15 years, working with BHP and Santos Ltd. He has experience on the ground from an operational standpoint, as well as being an integral part of raising millions of dollars in capital funding for both private and public companies in recent years.
Roger Leschuk - VP Corporate Development
Roger Leschuk has been in corporate management for over two decades, with the past 15 years dedicated to corporate development and investor relations. He has experience participating in and assisting with mergers and acquisitions, and was an investment advisor for various services such as stocks, mutual funds and tax-sheltered investments. He is a Chartered Investment Manager and a Fellow of the Canadian Securities Institute.
Monty Sutton - CFO
Monty Sutton brings over 35 years of experience in public markets and corporate governance. He previously served as CFO for Nuclear Fuels from its IPO through its acquisition.
