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The town of Ticaboo in southeastern Utah has been sold to a Canadian mining company that bought the mothballed Shootaring Canyon uranium processing mill this spring.
Riverton, Wyo.-based U.S. Energy Corp. said Monday that it sold the townsite for $2.7 million to Uranium One Inc. The townsite is five miles from the long-dormant mill, which Uranium One purchased in April from U.S. Energy Corp. along with 38,000 acres of mineral claims and leases in San Juan County, in the Lisbon Valley southeast of Moab and in the Henry Mountains northwest of Ticaboo.
In that earlier sale, U.S. Energy received $6.6 million in cash and 6 million shares of Uranium One stock, plus $20 million if the mill returns to commercial production, $7.5 million when a revived mill accepts its first delivery of minerals from the exchanged lands and a 5 percent royalty on mill production, up to $12.5 million.
"Housing is in limited supply in this area," said U.S. Energy Corp. chief executive Keith Larsen, "and Uranium One has recognized the importance of owning a fully developed Ticaboo townsite to accommodate its employees as it prepares the Shootaring Canyon Mill for full production."
The townsite includes a 149-unit mobile home park, a subdivision with lots for 98 single-family homes, a recreational vehicle park, a 70-unit motel, a restaurant/lounge, a convenience store and a boat storage-and-service facility.
Although only half a dozen homes have been built there, Larsen said numerous sites in the mobile home park are filled by employees of Dennison Mines, which operates a mine about eight miles from Ticaboo. Other employees stay regularly at the motel, he added.
The demand for housing will expand significantly if and when Uranium One completes the lengthy process of securing state Division of Radiation Control approval for a permit to resume mill operations.
"We'll be starting from scratch, so we'll need to hire a workforce," said Chris Sattler, senior vice president of investor relations for the Canadian company, which was known as sxr Uranium One until dropping the sxr portion in August. "This townsite will provide our workforce with a cheaper form of accommodation."
Along with the permitting work, Sattler said Uranium One is assessing the resources of the properties it bought earlier from U.S. Energy Corp. along with two mines - the Velvet and Frank M. - obtained during the summer as part of its acquisition of Energy Metals Corp.
"So we now have the mill, two of the original properties the mill was built for and this townsite," said Sattler.
Uranium One, which has operations in Kazakhstan, South Africa and Australia, was eager to expand into southern Utah because of the relatively high grade of uranium deposits in the West. In addition, Sattler said, "from a political risk standpoint, the U.S. is the best place in the world. It's a nice bit of diversification into a first-world jurisdiction."
News of Ticaboo's acquisition also pleased Garfield County Commissioner Maloy Dodds. "Anything that develops southern Utah excites me," he said, citing Dennison's ongoing operation and the refiling of thousands of uranium claims originally staked in the 1970s before the price of uranium plummeted.
Uranium was selling for $80 a pound Monday, down from a high of $138 during the summer but up from $75 a pound earlier this fall.
Dodds said a study is close to being done assessing the possibility of extending electricity to Ticaboo (a Paiute word meaning "friendly"), which depends for power on diesel-fueled generators.