DATE: NOVEMBER 1997

KENNECOTT MAY REOPEN SWEETWATER URANIUM MILL

Kennecott may open Sweetwater Uranium Mill

Kennecott Energy has submitted the last of the paperwork necessary to reopen the Sweetwater Uranium Mill in northeastern Sweetwater County, Wyoming.

Kennecott's Oscar Paulson said if uranium prices rise enough to make it cost effective, the mill could be back in operation within a year, processing ore from the Jackpot Mine near Jeffrey City.

US Energy and Kennecott are partners in the Green Mountain Mining Venture, which is expected to begin producing uranium from Jackpot by late 1998, depending on uranium prices.

Paulson, who has spent more than five years working on the application to reopen the mill and seven volumes of technical data to support the application, said the last of the paperwork - an executive summary - could be submitted to the US Nuclear Regulatory Commission this fall.

He said if the paperwork, much of which deals with managing tailings from the mill, is found in order, the mill could be licensed by next spring.

George Palochak, the mill's foreman, said the mill could be operating within six months after the license is issued.

Paulson added it all depends on uranium prices.

He said a concentrated uranium product, yellowcake, was selling for $10.50 per pound on the spot market (early October), which is too low to cover the costs of operating the mill.

The mill was built by UNOCAL and opened in 1981, when uranium was selling for $65 per pound on contract, which usually commands higher prices than spot sales.

This summer, US Energy officials said prices would have to hit at least $20 per pound to make it feasible to begin mining and reopen the mill.

Paulson said he could not predict an exact opening date for the mill but said the NRC requires uranium-processing facilities to begin operating within two years of receiving a license.

He added Kennecott has already applied for and received a five-year extension on that deadline.

(From the Casper Star-Tribune)