Canadian company closes southern Utah mine

Toronto-based Denison Mines Corp. shut down the Tony mine in southern Utah on Tuesday due to slumping uranium prices but is opening another Utah mine that has higher grades of uranium.

Company President Ron Hochstein said the Beaver Shaft mine in San Juan County also has deposits of vanadium, which is used in steel alloys, and yields better uranium ore than the Tony mine in Garfield County.

The decision to close the Tony mine was made because of market conditions, he said.

Uranium yellowcake hit a high of $136 a pound last year, then plunged to $44 a few weeks ago and has since rebounded to about $55 a pound, he said.

Hochstein said that over the long term, he believes uranium will hold its value as countries around the world build more nuclear power plants. Earlier this year, the company opened another mine in Utah's San Juan County called Rim Canyon mine.

Denison Mines turns uranium ore into yellowcake at the White Mesa uranium mill near Blanding, the nation's only operating uranium mill. International Uranium Corp., based in Vancouver, British Columbia, bought Denison Mines in December 2006 and adopted the name for the combined company.

The Tony mine, eight miles from Ticaboo first opened in the 1980s and has an on-again, off-again history. Denison Mines reopened it in September 2007, taking about 200,000 pounds of ore annually.

Ticaboo is an area with known uranium assets that has attracted other players in recent years.

Toronto's Uranium One Inc. bought rights last year to a uranium mill there, along with 38,000 acres of mineral claims and leases from Wyoming-based U.S. Energy Corp. Uranium One has applied for state approvals to reopen the mill, a process that will take years, Dane Finerfrock, director of the Utah Division of Radiation Control, said Tuesday.