“Staking activity is up significantly,” said Lynne Boomgaarden, Wyoming’s Director for the Office of State Lands and Investments, referring to the number of claims filed for uranium development in her state. “We have really seen a significant increase since about June 2004. We took one lease application to the board in April 2004. In June 2004, we had 30 or so applications. That’s when we really saw the increase.” In June 2004, David Miller of Strathmore Minerals (TSX: STM; Other OTC: STHJF) quickly filed 10 minerals claims for uranium. On his heels, William Sheriff of Energy Metals (TSX: EMC) began filing claims as well. Since then, pages and pages of claims covering tens of thousands of acreage have been filed by Miller, Sheriff, their associates and their respective companies.

Subsequently, others jumped into the rush for Wyoming’s state uranium claims. From Crook, Campbell and Converse counties to Carbon, Sweetwater and Fremont, most of the available state trust lands, where uranium rollfront deposits had been previously identified by drilling during the previous two uranium booms, were snapped up. From Wyoming’s Powder River Basin, where most of America’s uranium and coal is produced, to the Great Divide Basin, which has seen uranium mining, any serious players, who wanted to quickly establish an in situ recovery (ISR) mining operation in Wyoming, marked their territory.

“Most of the activity we’ve seen in leasing has been speculative activity,” explained Boomgaarden. “We don’t have new mines and new operations right now.” As noted in Part 2 of this series, permitting a property to put into place an ISR uranium operation may take two or more years. She added, “When I first came here in the spring of 2003, there was nothing.” A few changes have taken place, which Boomgaarden and many others have noticed. Through the first half of 2003, spot uranium prices stagnated around the $11/pound level. On March 6th, spot uranium traded at $39.50/pound, according to the Ux Consulting Company, which keeps track of weekly spot uranium sales.
 
Holding costs on Wyoming’s state trust lands are affordable to speculators, when the underlying commodity in question has had a 500 percent increase in the past 62 months. Applicants file a lease application and pay an annual lease fee of $1/acre for each of the first five years of the lease. The application is presented to the Wyoming Board of Land Commissioners, which meets every other month. “Our royalty revenues from uranium have been pretty flat,” said Boomgaarden. “We can only hope as fiduciaries that we will enjoy operations on these leases that result in royalty returns.” And it appears her wish may soon be granted.

The majority of staking activity appears to have taken place in Wyoming’s Powder River Basin. An informal poll of uranium development companies confirms this may be the area where the newer ISR uranium operations are more likely to be established.

Of the six companies we interviewed, five expressed their initial ISR operation would be established in Wyoming’s Powder River Basin. The most prolific coal- and uranium-producing areas in the United States, the tri-state Powder River Basin lies between Wyoming’s Laramie Mountains, the Big Horn Mountains of Montana and Wyoming, and the Black Hills of South Dakota. According to the U.S. Geological Survey published in 2002, the Powder River Basin was estimated to have a mean of 16.5 trillion cubic feet of undiscovered natural gas, 1.5 billion barrels of undiscovered oil and 86.5 million barrels of undiscovered natural gas liquids. It has been geologically prolific for uranium because the host formation is the Eocene age Wasatch Formation, which occurs under the entire area.
 
At the southern part of the Power River Basin, Cameco’s (NYSE: CCJ) wholly owned subsidiary, Power Resources, has been steadily producing uranium oxide (U3O8) at their Smith-Highland Ranch. In 2005, Cameco reported production of 1.3 million pounds. The property has published proven and probable reserves of 16.1 million pounds of U3O8. (In Part Five of the Wyoming Series, StockInterview.com will discuss the tour of the ISR operation at Smith Ranch and feature an interview with Pat Drummond, superintendent of the mining operation. During our interview, Mr. Drummond announced the expansion of uranium production on the PRI properties and the additional hiring of personnel.) Capacity could run up to 2 million pounds annually at each of their two processing facilities.

Three of the six uranium development companies we interviewed also stated they intended to fast-track their ISR operation by creating a “satellite facility.” Such a facility would eliminate the need for a Nuclear Regulatory Commission (NRC) license. The uranium development company plans to “attach” its mining operation to an established producer. Under such a circumstance, the company would solution mine (also known as in situ recovery mining) uranium on its property. The uranium would then be shipped to an established producer for processing. Because the spot uranium price is rising, and may hold around these levels (or soar higher), a profit-sharing arrangement negotiated by the newly producing uranium company and the more established company would probably make sense.
 
Three companies told StockInterview.com their initial ISR operation, or further development of their property, would commence in the Powder River Basin area: Strathmore Minerals (TSX: STM; Other OTC: STHJF), Energy Metals Corporation (TSX: EMC) and Uranerz Energy (OTC BB: URNZ). Kilgore Minerals (TSX: KAU) has staked claims in the Powder River Basin (see StockInterview.com feature: “Unlocking the Riddle of Kilgore Minerals”). However, Kilgore plans to first drill in Nevada, not Wyoming. StockInteview.com also interviewed UR-Energy (TSX: URE) but was omitted in Part Three because their flagship property is outside the Powder River Basin. Part Four of this series, which will discuss Wyoming as a Uranium Province, will include UR-Energy’s snapshot featuring their Lost Soldier and Lost Creek uranium development.
 
Below are extended snapshots for each of the three companies and what they revealed. Please realize that uranium companies continue to build their property package. A package of claims may include state trust land, federal land or private property, or a combination of two or all three types of properties. While company executives talked openly, to a greater or lesser degree, some of the information they provided may be intentionally incomplete for competitive reasons.

A combination of broad, proven geological expertise and a strong portfolio of properties, it was difficult to pin down Terrence Osier, Senior Geologist (based at the Riverton, Wyoming field office of Strathmore Minerals), about the flagship property. It appears the first uranium development is likely to be in the Pine Tree-Reno Creek area. Composed of multiple ore bodies (as defined through historical drilling), the Pine Tree-Reno Creek project is located in Wyoming’s Campbell County.  The Reno Creek-Pine Hills properties are about 20 miles southeast of the formerly producing Christiansen Ranch and about 30 miles north of Cameco’s Smith Ranch. The project is comprised of three potentially uranium producing areas located closely to one another.

“We have 19 sections of land in the Reno Creek-Pine Hills area – 460 federal lode mining claims, encompassing more than 12,000 acres,” explained Terrence Osier. “The area has been heavily drilled. There are tens of miles of roll fronts under the state lease lands and federal claims.” During our telephone interview, Osier remarked, “I am a tad surprised no one else moved as quickly as Strathmore Minerals to snap these up.” Osier explained there were thousands of exploration drill holes in the 1970s by various exploration companies, including industry giant Kerr McGee, Pathfinder (once owned by General Electric), affiliates of the Tennessee Valley Authority (TVA), and Rocky Mountain Energy. Not exactly small companies, but ones who spent millions of dollars defining the ore bodies.

Strathmore Minerals’ Terrence Osier, senior geologist

The two main ore bodies at Reno Creek are said to have an historic resource of about 5 million pounds with an average grade of 0.056 percent U3O8. The depth of the first zone is 230 to 250 feet; the second zone reaches down 318 to 360 feet. Due west and nearly adjacent to the Reno Creek property is the state lease Section 36, which the historic ore body is reportedly about 350 deep. The Tennessee Valley Authority (TVA) affiliates apparently drilled it sufficiently to define an ore body, which may hold 1.3 million pounds grading 0.05 percent. Nearby are the federal Pine Tree claims, where Pathfinder had drilled several hundred holes in the 1970’s. According to the research files of Rocky Mountain Energy, there may be 3.4 million pounds with an average grade of 0.07 percent.
 
Osier stressed why the Reno Creek area would be excellent for an ISR operation, “A satellite operation with tolling to the present facilities at either the Christiansen Ranch (Cogema) or the Highland-Smith Ranch (Cameco) or the company could make its own processing facility and eventually build satellite operations that feed it.” Osier added, “The Powder River Basin is active in methane exploration and production, and coal mining. This means excellent, nearby drilling and operational personnel and equipment.”
 
StockInterview.com has sufficiently provided background on David Miller. Previous articles, demonstrating his depth of expertise and knowledge about the uranium industry and uranium solution mining can be found in the StockInterview.com archives. He is widely respected through the uranium mining industry. A better understanding of Mr. Miller and his background may be found by reading these introductory articles in a four-part series, published on this news site in June and July 2004: “Why Do Uranium Prices Creep Higher?”

Chief Executive Glen Catchpole brings his credentials to Uranerz Energy from his previous ISR mining experience with Uranerz and Cameco.

One of the biggest strengths a uranium development company can have is its lead geological expert. The more experience he has, the more favorably institutional investors will accept the project (see “How to Choose a Uranium Stock”). Uranerz Energy Chief Executive Glen Catchpole has got the mandatory credentials. A licensed civil engineer, Catchpole was formerly the Uranium ISR Manager Wyoming’s Department of Environmental Quality, having helped write some of the environmental regulations. He has overseen the operations of two large Canadian uranium mines, and was the Corporate Manager for one ISR uranium mine in the United States, Crow Butte (now owned by Cameco). In 1996, he was appointed General Manager and Managing Director of the Inkai mining project in Kazakhstan, spending six years taking the project through feasibility, government licensing, environmental permitting, design, construction and the first phase of start up operations (1996 – 2002).
 
Joining Catchpole you will find a number of ex-Uranerz geologists, who left after Cameco acquired the company. For example, Dr. Gerhard Kirchner was involved in the Key Lake uranium discovery, the engineering and development of the Midwest uranium deposit, Eagle Point’s uranium deposit and the Crow Butte ISR uranium deposit. George Hartman was the General Manager for the Uranerz USA ISR projects, managing the Ruth, Crow Butte, and North Butte solution mining projects.
 
While extremely knowledgeable, Mr. Catchpole did not reveal the immediate plans of Uranerz Energy. StockInterview.com did discover that he met with Rick Chancellor, the administrator of the Land Quality Division of Wyoming’s Department of Environmental Quality. It is unknown whether Uranerz has begun the permitting process on its Powder River Basin ISR-amenable properties. He told StockInterview.com, “We plan to develop an ISR operation in the Powder River Basin area.” While he hinted at possible pounds and the annual production level, Catchpole would not further discuss where he planned to establish the initial ISR operation. Catchpole admitted, “We are still putting our package together.” During Wyoming’s frenzied uranium staking activity, Catchpole wisely would not want to divulge where his company plans to solution mine. As is the nature of the game, a competitor might interfere with his negotiations or stall his development plans. (This is oft-remarked by those interviewed.)
 
It has been publicly reported that Uranerz Energy has obtained sixteen mineral leases, comprising thirty-one parcels of Wyoming State trust lands – about 14,200 acres. According to the Uranerz website, all leases are located in sandstone basins of Cretaceous or Tertiary age. Twelve of those are reportedly in the Powder River Basin. On the company’s website, the size of the Uranerz uranium holdings are described, “Based on historical exploration information, including rotary drill and gamma logging information, Uranerz believes that it now has total potential uranium resources in Wyoming of over 30 million pounds measured as U3O8.” In January, a Uranerz Energy news release announced an additional acquisition: “Uranerz Energy Corp is pleased to announce that it has entered into an Option and Purchase Agreement with Excalibur Industries ("Excalibur") on six mineral properties located in the Powder River Basin of Northeast Wyoming. The six mineral properties are comprised of forty-four (44) unpatented lode mining claims containing significant drill-indicated uranium resources.
 
Each of the Powder River Basin projects has reported the presence of drill-indicated uranium. The Powder River Basin uranium resources occur in typical multiple stacked geochemical roll fronts at the interface of reduced and oxidized areas of the host sandstone units. Evidence of mineralization was originally determined from electric logs from wide spaced drilling and cross sections correlated by previous geologists. The uranium resources on the Company’s Powder River Basin properties are believed to be beneath the water table and can be mined by the low cost in-situ recovery mining method.
 
The budget-conscious Catchpole has previously put an ISR operation into place in Wyoming, and he did so at a lower than average cost. He likes to put a “Chevrolet” operation into place as opposed to the Cadillac version, which will keep costs down and extract the most uranium for the least money. Catchpole’s initial plans are to establish an ISR satellite operation to an established producer. When questioned how fast he could move on this, Catchpole responded, “It will take a minimum of two years.” While interviewing others about Catchpole’s credentials and expertise, the consensus agreed that Glen Catchpole was very credible.

Dr. Dennis Stover

The lead technical guru at Energy Metals Corporation is Dr. Dennis Stover, the president of Energy Metals U.S. Dr. Dennis E. Stover holds B.Sc., M.Sc., and Ph.D. degrees in Chemical Engineering from the University of Michigan. He has authored or co-authored 27 articles relating to uranium and holds a number of United States Patents concerning various aspects of solution mining and reservoir restoration. In various internet searches about solution mining, one often finds his name attached to a presentation, a diagram, or an illustration.
 
In 1989 Dr. Stover joined Rio Algom Mining Corp. as the Director of In Situ Recovery Technology. He prepared the feasibility study and the commercial AFE for the Smith Ranch ISR property in the Powder River Basin of Wyoming. He was responsible for the entire process flow sheet for the Smith Ranch uranium recovery facilities. Dr. Stover served as the Manager of Wyoming Operations from 1993 through 1997. His expertise is in the field is vast and requires a link to his bio for a better understanding.
 
During a telephone interview with William Sheriff, Director of Corporate Development for Energy Metals and a successful geologist and prospector in his own right, he told StockInterview.com the flagship Wyoming properties would be the Moore Ranch, Peterson and Nine Mile Lake properties. Sheriff explained, “We hope to be in production within the next 36 to 48 months. Our five year goal is to produce five to seven million pounds annually through two to three central plants.” He said that one is planned in Texas and the other one or two would be located in Wyoming.

 
The Moore Ranch has an historic resource of 5.2 million pounds of U3O8, as delineated by Conoco which drilled the property in the 1970’s. The claims cover more than 1800 acres along Highway 387 in Campbell County 23 miles southwest of Wright, Wyoming. Sheriff believes the roll front uranium deposit, grading 0.07 percent, could be mined at a depth of between 200 and 600 feet.
 
To the south is the Peterson property with an average grade of 0.076 percent, but which hosts a smaller historic resource, 2.5 million pounds. This property, covering more than 3,000 acres, is approximately 12 miles south of the Smith-Highland Ranch in the southern Powder River Basin. It is comprised of Wyoming state leases, federal mining Claims, and leases on private-fee interests. Sheriff thinks the uranium deposits can be found at a depth of 200 to 300 feet.

Finally, for the initial operations, there is the Nine Mile Lake property, which may hold 9 million pounds, grading 0.055 percent, and with an average thickness of 25 feet. Sheriff said the uranium deposit may be found at between 100 and 400 feet deep. This property was drilled and developed by Rocky Mountain Energy, with more than 200 drill holes delineating the roll front uranium occurrences. Sheriff said the deposit extends over a strike length of more than 6,000 meters and may be up to 900 meters wide, at its widest point. It covers more than four square miles. Between November 1976 and November 1980 a test ISR plant operated on the property with mixed results. A total of four well field patterns underwent testing and development. Based on the results from the well field testing, plans were made to build and permit a commercial ISR plant before the uranium price began its twenty-year bear market.
 
All three of these uranium development companies seem to hold strong promise during the current uranium bull market. As long as the spot uranium price continues to rise or maintain its current level, it would not surprise StockInterview.com that all three could establish an ISR operation in Wyoming’s Powder River Basin.