Virginia Uranium starts scoping study

Virginia Uranium Inc. has started a scoping study to help narrow and define the Coles Hill uranium mining and milling project.

The study, which began about two weeks ago and VUI officials expect to be complete by June, will help give an estimate of the project’s costs and a more specific idea of how many and what kinds of jobs it would create, said Patrick Wales, VUI geologist and spokesman. The company hired two engineering firms — Lyntek Inc. and BRS Inc. — to conduct the analysis.

“It’s a very important step in further defining the tremendous economic benefits of this project for the Southside,” Wales said Friday.

VUI hopes to mine and mill a 119 million pound uranium ore deposit at Coles Hill, about six miles northeast of Chatham. Virginia has had a moratorium on uranium mining and milling since 1982. The National Research Council is conducting a study to determine whether uranium can be mined and milled safely in the commonwealth. NRC officials expect the study to be complete by the fall of 2011.

VUI officials say the Coles Hill project would provide 300-500 jobs in Pittsylvania County. The study will help VUI determine the precise number of positions needed for the project and what types jobs each employee would perform, such as operating heavy equipment or working in the mill, Wales said.

“The scoping study will give us a better understanding of the up-front capital investment into the local community, as well as the skills required and number of employees that we would hire,” said Walter Coles Sr., chairman and CEO of VUI, in a prepared statement. “This is an exciting and important step to quantify the benefits of developing the Coles Hill uranium project of our nation’s energy independence and for the economic prosperity of Southside Virginia.”

Wales said the scoping study would also provide a “ballpark” figure for producing a pound of yellowcake — the mined, processed uranium ore that would be VUI’s product. To be used as fuel in a nuclear power plant, yellowcake still has be to further refined by other nuclear fuel plants.

The Coles Hill uranium ore deposit is estimated to be worth more than $7 billion, Wales said.

Before beginning the scoping study, the company had completed a National Instrument-43-101 study in the spring of 2009. The next steps will involve pre-feasibility and feasibility studies, Wales said. A feasibility study cannot be performed unless the uranium becomes a legally recoverable resource.

Marline and Union Carbide conducted scoping and feasibility studies of the Coles Hill site more than 20 years ago, when the companies wanted to mine and mill uranium there. VUI’s study will provide more up-to-date results in the context of current technology and economics, Wales said.

Lyntek, based in Lakewood, Colo., is a mineral processing company that has experience with uranium mining projects around the world. Riverton, Wyo.-based BRS is a mining engineering company.