Energy Biz - September/October 2008 - (Page 16) » Financial Front Uranium Supply Questions FiNdiNg FUEL FOR AN ExPANdEd FLEET By PAUL WENSKE sen. John Mccain, The republican recently. Now it’s at $64 a pound. That puts a different number on the economics.” Heymer says that achieving construction of a first wave of plants built on budget and on time would inspire confidence in the licensing process that then could spur a second wave, prompting more demand and exploration. “You are going to see the demand/ supply equation begin to balance out,” he says. The United States currently has 104 nuclear Party candidate for U.S. president, in June called for the construction of 45 new nuclear plants by 2030. The bold statement cheered an industry experiencing a renaissance of interest in the wake of growing concerns for rising energy costs and global warming. Yet, the optimistic goal is rife with uncertainties, not the least of which is whether enough uranium is available to fuel that many plants. It’s a question vexing some energy experts. After all, the world presently consumes 160 million pounds of uranium Senator John McCain sOurcE: aP/ PhiL MccarTEn fuel per year but only produces 100 million pounds. The gap, up to now, has been supplied by stored inventories of earlier mined uranium and decommissioned, diluted warheads. “We have a 60-million-pound gap in the supply,” notes Samuel B. Romberger, a geological engineer at the Colorado School of Mines. “We can’t even meet our needs now from primary production,” he says. It’s not that Romberger and other experts who question the goal’s reality are nuclear critics. But they say reaching McCain’s goal may not be easy. “It’s a major issue that’s not been discussed enough,” Romberger says. Industry insiders acknowledge the challenge. But they compare it to the chicken-and-egg analogy. The industry plants. Official estimates anticipate 34 applications has been in limbo for 30 years. No new nuclear plants for new construction will be filed by 2010. McCain’s meant low demand for fuel. Uranium’s price fell to $15 goal is partly based on a belief that adding another a pound, hardly enough to spur full-bore exploration. 11 plants over 20 years is not that much of a stretch. Since the lowest price was reached, rekindled “It is feasible and can be done,” Heymer says. “And interest, the promise of loan guarantees and a flurry like anything else, success breeds success.” of new plant applications caused uranium’s price Despite renewed exploration within its borders, the to shoot up last year to more than $130 a pound United States remains a lesser player, last year producbefore settling back to $64 a pound this year. The ing 4.5 million pounds and purchasing 47 million pounds incentive of higher prices spurred exploration. from other countries. Top producers are Canada, “We believe there is sufficient fuel,” says Adrian Australia and Kazakhstan, whose higher-grade ore is Heymer, senior director of power plant deployment also easier and more rewarding to mine. for the Nuclear Energy Institute, the industry’s trade But high-quality ore is limited even in these coungroup. “The fuel issue was masked by the fact that tries, leading critics to argue there is only enough there hasn’t been much mining of uranium until September/October 2008 16 E n E rgyB i z
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