The trade war rumour mill spun uncertain news for Canadian uranium miners this week as Donald Trump considers protectionist measures to light up the US mineral extraction industry.
Two uranium mining companies, Ur-Energy and Energy Fuels, have lodged a petition with the White House and said they are "confident" that the President will implement limits on uranium imports after the Commerce Department recommended urgent steps to boost domestic production of a list of 35 ‘critical’ minerals, including the nuclear fuel.
Current uranium prices are hovering in the mid-$20s/lb compared to highs of over $140/lb in 2007, and US uranium production has dropped to near historic lows in recent years. A decision from the White House is expected in July, but it is unclear whether Canadian uranium stocks - other than those who mine in the US, of course - might yet benefit on the grounds that they are strategically a better bet than shipments from overseas.
Among those Canadian miners, Denison Mines (TSX: DML) is forging ahead with plans to open a new mine, announcing this week that the Canadian Nuclear Safety Commission and the Saskatchewan Ministry of Environment have accepted its Provincial Technical Proposal and Federal Project Description for the uranium mine and processing plant its wants to build at its 90% owned Wheeler River Project. Denison also announced a series of Memoranda of Understanding with Indigenous communities in areas around Wheeler River.
Denison CEO David Cates said: "Successfully engaging, and entering into MOUs with local Indigenous communities, ahead of the initiation of the EIA process, signals strong support for the advancement of Wheeler River in future years. We look forward to building on the relationships that we've established over the past several years to develop a collaborative vision for the future of the Project."
The latest Canadian mining news came as the Province of Saskatchewan sued the federal government for its share of the cleanup costs of what used to be the world’s largest uranium mine. In a reminder of the risks inherent with the sector, the state has spent $135 million so far cleaning up the Gunnar Mine, which operated between 1954 and 1963.
Bronwyn Eyre, Saskatchewan’s minister of energy and natural resources, told reporters during a mine site visit that the Canadian federal government has so far contributed just $1 million and total costs are estimated at $280 million.
“I think any fair observer looking at that information would say that is not fair,” Eyre remarked.
Elsewhere among the Canadian miners, junior gold stocks were enjoying a good week for the yellow metal, with spot prices nearing gold’s 2019 highs. Among the explorers, Great Bear Resources (TSXV:GBR) enjoyed a major Filipino for its stock price after discovering a new high-grade gold zone at its Dixie project in the Red Lake District of Ontario. Highlights from the new discovery, called the Bear-Rimini zone, are 12.33 grams per tonne (g/t) gold over 14 meters, including 30.9 g/t gold over 4.6 meters, and 194.21 g/t gold over 2 meters, including 759.38 g/t gold over 0.5 meters. Bear-Rimini is part of a new exploration target called the LP fault.
For those anticipating a large-scale sale of gold mining prospects from the Barrick-Randgold merger, the company’s chief Mark Bristow gave a few hints in an interview in which he indicated that he primarily wants to offload mature assets. Echoing the thoughts of those who would happily buy any unloved acreages at the right price, he said: “It's better to put them in the hands of people who are going to put the effort in.”
But he added: “We want to bring them to account with the cooperation of our host countries and not just sell them to anybody who walks past, because we plan to be there in the next decades and all our assets sit in world-class geological addresses, so you don't want to burn your license to operate.”
That rules out the impulse buyers, then.