An Australian mining firm responsible for the only open-cast uranium mine in the European Union suffered a 40-per-cent loss in its value this week as it was reportedly denied permits.
Berkeley Energia, which is listed in the UK, Australia and Spain and operates no other projects, had said its lawyers were working closely to resolve two outstanding licensing issues for the mine near Salamanca (pictured) in northwest Spain.
It said the mine would run for 14 years, generating investment of over €250 million and more than 2,500 direct and indirect jobs in the Spanish region.
Now the Socialist-led minority government, according to the Spanish media, had decided not to award the firm the two permits necessary to continue operating the mine.
Spain’s nuclear authority is soon expected to renew its board and the Socialist party and its junior parliamentary partner, Podemos, who both oppose the uranium project, will hold a majority on it.
Berkeley Energia was granted preliminary approval in early 2013 and was awaiting a building licence and official authorisation to handle radioactive waste.
“The government will wait for the ongoing proceedings to go through, but it will say ‘no’,” a government source told Reuters.
Spain’s energy and environment ministry and Nuclear Safety Council declined to comment.
UK-based Berkeley Energia said it “received no official notice in this regard from the nuclear safety council nor any other government department to date” and was seeking “immediate clarification” from the environment ministry in Madrid.
It focuses on the uranium-mining district of western Spain, where it has already been operating for more than a decade, originally in a deal with Enusa, the state-run uranium firm. That partnership ended in 2012 and Berkeley Energia took full ownership of several uranium deposits.
The Salamanca mine is intended to be one of the world’s lowest-cost producers of uranium with the project’s feasibility study indicating it is capable of producing an average of 4.4 million pounds of uranium per year over an initial 10-year period.
In 11 years it has invested more than €70 million with a promise of €250 million in subsequent investment.
Berkeley Energia said the price of uranium had continued to strengthen over the past quarter, up 21 per cent since June. The price fell after the Fukushima disaster in 2011 but has rallied this year.
London-listed investment vehicle Yellow Cake, which has been buying and storing the element, has helped boost the price.
Berkeley added: “The fundamentals for uranium remain very strong and in the opinion of many market observers have now reached a tipping point.”
Salamanca. Picture credit: Wikimedia