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Just Other Articles - Smart Investing in Uranium Could Mean ISL
Now that the spot uranium price has sustained above $40/pound, after a 20-year drought and a bottom of $6.40/pound at the end of December 2000, hundreds of junior exploration companies have thrown their hat into the ring. Both Canadian and Australian junior uranium companies hope to raise the big money required to bring a uranium property into production. A p
According to USFDA, a combination product is one composed of any combination of a drug and device; biological product and device; drug and biological product
erceived uranium supply crunch has added to this frenzy. As occurred with previous uranium cycles, only the strong will survive.
While numerous Canadian junior exploration companies hope to find a new discovery in various uranium-prospective regions through Canada, a safer investment strategy is to speculate on companies, whose properties were previously dri
While numerous Canadian junior exploration companies hope to find a new discovery in various uranium-prospective regions through Canada, a safer investment strategy is to speculate on companies, whose properties were previously dri
; or drug, device, and biological product and fixed dose combination would include two or more combinations of drug.
Examples of combination products may in
Examples of combination products may in
led during the uranium bull market of 1974-1980). Some of those properties had uranium deposits delineated by major oil and uranium companies, who did not blush at spending tens of millions of dollars in exploration.
Some of the newly arrived uranium companies acquired those drilling databases and their properties, which were abandoned by the previous owners
Some of the newly arrived uranium companies acquired those drilling databases and their properties, which were abandoned by the previous owners
lude drug-coated devices, drugs packaged with delivery devices in medical kits, and drugs and devices packaged separately but intended to be used together.
. Some companies have been actively moving their projects forward to production, using a more environmentally friendly mining method than an open pit or underground mine. It is called In Situ Leach (ISL) uranium mining, and the operation is much like a water treatment plan. Oxidized, or carbonated, water is pumped into an orebody, and uranium is flushed into
here is enormous increase in the number of combination products entering the market in the recent years. Combination products have proven advantages but fixe
processing plant. These are relatively inexpensive to install, possibly for as little as $10 million.
There are pitfalls when investing in those companies which plan to establish ISL operations. During the initial phase of this bull market, a common myth, circulated among investors, had been "pounds in the ground." How many pounds of uranium oxide, or U3O8
There are pitfalls when investing in those companies which plan to establish ISL operations. During the initial phase of this bull market, a common myth, circulated among investors, had been "pounds in the ground." How many pounds of uranium oxide, or U3O8
d dose combinations are still in the process of convincing regulatory authority on their advantages over the single ingredient formulations.
Combination pro
Combination pro
for short, does a company have in the ground? The more pounds a company claimed, the higher its market capitalization ran. Once you sift through the companies with very real prospects from those who are cheerleading their "pounds in the ground," you should have a realistic short list.
These are the four key questions which must be answered if you wish to min
These are the four key questions which must be answered if you wish to min
ucts have become life saving products for the pharmaceutical companies who doesn’t have many innovative molecules in their product pipeline and have been inc
mize your risk when investing in uranium stocks:
How permeable are the ore bodies you plan to mine?
What is your average grade?
Over what area does your rollfront extend?
What is the depth of your ore body? One of the most important factors to consider is the permeability of the sandstone, from which the uranium will be mined. Permeability is the flow r
How permeable are the ore bodies you plan to mine?
What is your average grade?
Over what area does your rollfront extend?
What is the depth of your ore body? One of the most important factors to consider is the permeability of the sandstone, from which the uranium will be mined. Permeability is the flow r
easingly used in the product life cycle management. Even the companies having product patents are trying to extend their product life cycle through the combi
ate of the liquids through the porous sandstone. Knowing what the permeability of the orebody will let you know how much water you can get through the sandstone formation. Harry Anthony, an internationally recognized ISL expert, noted, "You need higher grade ore for tight formations. With high permeability, you can space your wells further apart."
The make-b
The make-b
nation products and maximize the revenues. But the companies involved in this practice are overlooking that they are burdening the patients both economically
eak point for a formation's permeability is its Darcy rating. How high is the Darcy? A typical Darcy can range from minus 1000 to plus 3. The higher the Darcy, the more permeable the formation. This helps determine how economic the orebody is. An acceptable range would be one-half to one Darcy. What is a Darcy? Uranerz Energy CEO Glenn Catchpole, who is also
and physically. They need to rightly judge the benefits of the combination products and they have to even look at the risks involved when combining the produ
a hydrologist, said, "It is gallons per day over feet squared." He added a pure hydrologist would calculate the feet per day or centimeters per second to get a more accurate permeability assessment.
With low permeability in a tight formation, you may need to space more wells in a typical well field pattern. While explaining that costs are fixed and variable,
With low permeability in a tight formation, you may need to space more wells in a typical well field pattern. While explaining that costs are fixed and variable,
ts. Some of the combination products were well accepted by physicians while others suffered. Companies involved in development of combination products are fi
Anthony computed the cost of a production well for a 500 foot deposit at $15,000. An injection well could cost $11,000 to install. By comparison, in New Mexico, where the deposits are wider and of higher grade, a 2000-foot production well might cost $27,000 and the injection well could cost $18,000, and it would still be economic. Obviously, the deeper the de
ding difficulty in defining their combination products and facing various challenges from selecting a combination to marketing it.
Following aspects would a
Following aspects would a
osit, the more it will cost to extract the uranium. Not only will the capital costs increase, but operating costs will be greater.
Uranium grades can be a contentious point. "Grade is the driving force," Harry Anthony shot back. We asked him about companies which said they could run an economic ISL operation with grades as low, or lower than 0.02. Anthony la
Uranium grades can be a contentious point. "Grade is the driving force," Harry Anthony shot back. We asked him about companies which said they could run an economic ISL operation with grades as low, or lower than 0.02. Anthony la
dd to the challenges in developing combination products:
Which markets to tap where the combination products can do fairly well?
Which combination prod
Which markets to tap where the combination products can do fairly well?
Which combination prod
ughed, "They'd be out of business before they started." Strathmore Minerals' president David Miller offered a more technical analysis, "That will not likely have enough recoverable pounds. The operating grade feeding the plant will be too low." What is the best grade? Miller wanted to see properties with deposits that average on the order 0.5, 0.10, or 0.15.
cts are meaningful and rational?
Which therapeutic categories to select?
Which Combinations can address unmet needs of the patients?
Do combin
Which therapeutic categories to select?
Which Combinations can address unmet needs of the patients?
Do combin
Uranium grades can impact the cost of operating an ISL plant. An ISL plant may operate at 5000 gallons per minute. Running 24 hours daily, the plant would process 7.2 million gallons of water. Operating costs are based upon cost per thousand gallons of water. "This includes electricity, reagents and labor," said Anthony. On a daily basis, it would cost more t
tions increase the patient compliance?
What would be the developing cost?
How to tackle the risks encountered during combination product developmen
What would be the developing cost?
How to tackle the risks encountered during combination product developmen
han $21,000 to run an ISL plant, based upon Anthony's calculations of $3.03 per thousand gallons of water. Under this scenario, a plant might produce 2360 pounds of U3O8 every day or 80,000 pounds monthly. The cost to produce each pound would be $8.18. Using that math, the uranium grades would be about 44 parts per million (ppm) or 0.08. Anthony said, "I like
t?
As combination products don't fit into the traditional categories of drugs, medical devices, or biological products, the USFDA is in the process of devel
As combination products don't fit into the traditional categories of drugs, medical devices, or biological products, the USFDA is in the process of devel
to see 70ppm or higher." That comes to a uranium grade of 0.13.
Another way to evaluate a company's uranium property is looking at each part of its development costs. In a well field pattern, David Miller can determine the economic viability of the ground. "The keys to what is recoverable include how many pounds are recoverable per pattern and what it costs
Another way to evaluate a company's uranium property is looking at each part of its development costs. In a well field pattern, David Miller can determine the economic viability of the ground. "The keys to what is recoverable include how many pounds are recoverable per pattern and what it costs
ping new procedures for reviewing their safety, efficacy and quality.
Professional from academic institutions, pharmaceutical industries, health care indust
Professional from academic institutions, pharmaceutical industries, health care indust
to install a pattern," Miller explained. "If you have 10,000 pounds in place and can recover 8000 pounds, your well field development cost can be $8/pound, if it costs you $80,000 to install that pattern.
The cost to install a pattern also depends over how much territory your uranium deposits run. "Ten million pounds over an area of one-half mile will cost l
The cost to install a pattern also depends over how much territory your uranium deposits run. "Ten million pounds over an area of one-half mile will cost l
y and representatives from various regulatory agencies are working out to design the regulatory requirements for manufacture and sale of combination products
ss than those same pounds over an area of two to four miles," explained Terrence Osier, Strathmore Minerals senior geologist. "That means more injection wells and more production wells." Depth of the wells influences installation cost and impacts its daily operating cost. "When uranium costs were very low, a company needed 70,000 pounds per pattern," Anthony
.
As there is an increasing trend of the combination products companies manufacturing such products should be able to tackle the problems involved in the de
As there is an increasing trend of the combination products companies manufacturing such products should be able to tackle the problems involved in the de
commented. "Now a company might only need 20,000 pounds per pattern to make it economic."
There are many variables within the above advices provided by these experts. However, the important point to realize is the time of hyperbole and hoopla over "pounds in the ground" has passed. As more uranium development companies move closer to establishing an ISL oper
There are many variables within the above advices provided by these experts. However, the important point to realize is the time of hyperbole and hoopla over "pounds in the ground" has passed. As more uranium development companies move closer to establishing an ISL oper
elopment. They need to be wiser in analyzing the market trends and the regulatory requirements.
Companies that provide selfless information through particip
Companies that provide selfless information through particip
tion, the go/no-go consideration, as
UR-Energy CEO William Boberg aptly described it, will come down to permeability. After that, the economics of a project will either make it viable or not. Using these criteria, you can avoid the hysteria by speculating with the odds stacked more in your favor.
COPYRIGHT © 2007 by StockInterview, Inc. ALL RIGHTS RESERVED
COPYRIGHT © 2007 by StockInterview, Inc. ALL RIGHTS RESERVED
tion in industry events and feedback to regulatory authorities would be able to face the challenges and will be successful in developing combination products
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