Strong Uranium Demand Leads IUC to Reopen U.S. Mines

International Uranium Corp. [TSX:IUC] has decided to reopen its Four Corners region mining operation after a seven year sabbatical. Located in the Western United States, three properties are expected to reopen: the Colorado Plateau, the Henry Mountains, and the Arizona Strip.

Four mines at the Colorado Plateau are slated to commence mining operations immediately with two more mines expected to reopen in late Spring of 2007, pending permits. The ore which is mined at the Colorado site will be stockpiled until processing at the White Mesa mill. At the Henry Mountains properties, production is expected to begin in 2007 and 2008; at the Arizona Strip locations, production dates are scheduled to commence late summer of 2007.

In yesterday’s press release, IUC President, Ron Hochstein said, ”IUC is happy to be back as a significant U.S. uranium producer – and at a time of record uranium prices. Our mines and mill will provide us with many years of rapid growth to look forward to. We intend on utilizing our large capacity mill to its full advantage through toll milling contracts with other future miners in the area and our very successful alternate feed program. This year alone we will be producing over 500,000 pounds of U3O8 to IUC’s credit through one alternate feed contract.”

The initial expected production numbers for the IUC uranium sites are impressive with company estimates at 3.4 million pounds of U308 and 5.9 million pounds of vanadium, a metal often used as an additive to steel to make high-quality alloys, the first year.

IUC’s wholly owned uranium/vanadium mill in southeast Utah, White Mesa, is one of only two dual circuit (processes both uranium and vanadium) mills in the United States. Ore processing at the mill is scheduled to begin in the late 2007 or early 2008. Following the first year estimates of 3.4 and 5.9 million pounds, the expected average is between 1.5 million and 2 million pounds annually thereafter.

In a company press conference this morning, IUC President Ron Hochstein said there are two ways to optimize mill production; through sales and through the mill feed supply.

Currently, IUC has not entered any sale contracts for uranium or vanadium, and is ”evaluating looking into some contracts,” Hochstein said. Secondly, in order to start the mill, IUC needs supply. Pending possible contracts, IUC may look into starting the mill sooner (most likely 2007 instead of 2008) dependent upon the economics of toll milling and even purchasing some ore. Essentially, starting the mill sooner is reliant on having a contract to start the projects and enough ore to keep the mill running.

Uranium Price Activity
Uranium spot prices have been on the climb, and many investors are enjoying the steady ride-up in a trend that appears it will continue to gain altitude.

During June of 2004 U3O8 prices were recorded at $18.50/lb, during June of 2005 spot prices hit $29.00/lb, and this June prices have hit a whopping $45/lb.

Share Price Activity

In afternoon trading, IUC stock was up 48 cents at $5.69. With uranium demand growing throughout the world as the energy needs in places such as India and China increase, further research into IUC may be a wise choice if this uptrend continues.

Source: www.resourceinvestor.com