Uranium is an essential material for the US to be able to run its electricity grid and to run its nuclear powered military. Of course, like rare earths the US does not produce enough uranium to supply its core needs. Nearly half of the US uranium needs are supplied from Russia or other former Soviet Union states, whose state-owned companies have been flooding the global market and driving free-market companies out of business, virtually killing the US uranium market.
One of the best-placed US uranium miners to benefit from these findings (if implemented) is Western Uranium & Vanadium Corp. (CSE: WUC | OTCQX: WSTRF).Western Uranium & Vanadium is a uranium and vanadium ‘production-ready’ miner from their mines in western Colorado and eastern Utah. The Company’s Projects cover both vanadium and uranium. Their flagship project is The Sunday Mine Complex that covers 5 mines located in western San Miguel County, Colorado, USA.
Western Uranium & Vanadium projects summary
In August 2014, the Company acquired uranium and vanadium mineral assets from Energy Fuels Inc., and in September 2015 they acquired additional uranium properties and ablation technology through the acquisition of Black Range Minerals Limited. The Company has a total uranium resource of ~70,000,000 lbs, and a vanadium resource of ~35,000,000 lbs. Grades are solid at the Sunday Mine Complex with U3O8 (~0.25% to 0.36%) and V2O5 (~1.49% to 2.16%).
Western Uranium & Vanadium’s strategyWestern
Uranium & Vanadium’s strategy is to focus on previously producing mines for low CapEx projects with existing infrastructure and permitting in place. For lower cost processing of ore, the Company has a proprietary process (Ablation Mining Technology (AMT)) that improves efficiency and reduces costs for sandstone-hosted deposits.
The Sunday Mine Complex is now at a production-ready status with first ore shipments expected by February 2020
The Sunday Mine Complex was re-opened in 2019 and successful mine development of the underground workings during 2019 has brought the Sunday Mine Complex into production-ready status. Mined ore is currently being stockpiled underground. Colorado safety requirements are in process of being met, so that ore samples can then be sent to prospective buyers. These steps should be completed in January and February 2020 respectively.Given the NFWG is reported to recommend the US start ‘to buy more uranium from domestic producers’, the timing should be great for Western Uranium & Vanadium. I assume the US military would pay a uranium premium price that allows US producers to be profitable.Western Uranium & Vanadium’s head office is located in Nucla, Colorado; and has a market cap of C$ 28 million. Analyst’s target price is $4.80 representing a huge upside.
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