The growth in demand for nuclear energy is prompting the United States to abandon uranium mines and restart them. The revival is approaching.

In the United States and its allies, owners of abandoned uranium mines are restarting operations to take advantage of the increasing demand for nuclear fuel. It is understood that at least five U.S. producers are reopening mines in Wyoming, Texas, Arizona, and Utah. Previously, uranium mining in these states was thriving until governments around the world developed a negative attitude towards this radioactive element following the 2011 Fukushima nuclear disaster. Not only that, but most U.S. mines closed after the Fukushima incident, when the price of uranium collapsed and countries like Germany and Japan began planning to phase out nuclear reactors. Now, as governments around the world turn to nuclear power to meet emission reduction goals and major uranium producers struggle to meet demand, the price of this silver-white metal is skyrocketing. This provides an opportunity for these once unprofitable uranium mines to fill the supply gap. It is worth noting that uranium has been used as an energy source for over sixty years, providing fuel to nuclear power plants and reactors. Approximately two-thirds of global production comes from Kazakhstan, Canada, and Australia. Revival of the Uranium Mining Industry As thousands of mining executives, geologists, and bankers gather in Toronto to attend the annual convention of the Prospectors & Developers Association of Canada this week, uranium will be a hot topic of discussion. This event has attracted at least 10 uranium companies, including Denison Mines Corp., Fission Uranium Corp., and IsoEnergy Ltd. Meanwhile, as more countries consider using nuclear energy to tackle climate change, demand for uranium is expected to soar. The International Atomic Energy Agency estimates that by 2040, the world will need over 100,000 tons of uranium annually - almost double the current mining and processing capacity. Canadian Cameco Corp. and Kazatomprom from Kazakhstan, which together account for half of global supply, have been working to increase production. However, both companies have warned that due to operational issues, uranium production in the coming years will be lower than expected. Scott Melbye, Executive Vice President of Texas-based Uranium Energy Corp., said, "We are in a classic, straightforward supply squeeze. With new reactors coming online, demand is increasing again." Due to years of underinvestment in mining and exploration, production has not been able to keep pace. Melbye stated that his company is reopening mines in Wyoming and Texas that closed in 2018. In addition, Energy Fuels Inc. began planning to restart operations in Arizona, Utah, and Colorado at the end of last year, while UrEnergy Inc. stated it would reopen a dormant mine in Wyoming. Medium-sized companies from Australia and Canada have also announced similar plans. However, the output of these mines - most of which are small and nearing the end of their lifespan - will only account for a small portion of the world's uranium supply. John Ciampagli, CEO of Sprott Asset Management, said, "The industry is clearly responding, with small mines reopening, but when a mine has been shut down for so long, it is obviously not very important." Top Producers Supply tightness should ease as major producers extract the millions of pounds of uranium they left underground during the downturn. Kazatomprom has been increasing production for years, with its operation levels previously well below capacity. Additionally, Cameco has been increasing production after closing the world's largest high-grade uranium mine and mill in 2018-2021 due to soft market conditions. Tom Price, Senior Commodities Analyst at London investment bank Libereum, said, "These two companies will be very concerned about losing market share to a group of startups, so they will want to reclaim that share. This will greatly alleviate market pressure." Nevertheless, the reopening of U.S. mines signals a revival of the American industry, which was on the brink of extinction five years ago. In 2019, U.S. uranium production reached a historic low of 174,000 pounds, a significant decrease compared to the peak of 44 million pounds in 1980, prompting the U.S. to increase imports from countries like Canada, Australia, Kazakhstan, and Russia. The Uranium Producers of America predicts that the U.S. will need to open eight to ten new large-scale mines in the next decade to meet demand.