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Home My WebLink AboutDRC-2024-005657Uranium Watch P.O. Box 13O6 Monticello, Utah 84535 435-26O-8384 April 14, 2022 Phil Goble Uranium Mill Environmental Program Manager Division of Waste Management and Radiation Control Utah Division of Environmental Quality 195 North 1950 West Salt Lake City, Utah 84116 RE: Processing of Rare Earth Elements. Energy Fuels Resources (USA) Inc. (EFRI) White Mesa Uranium Mill, San Juan County, Utah; Utah Radioactive Materials License UT 1900479 Dear Mr. Goble: Below is a follow up of your January 3, 2021, e-mail in response to my December 23, 2021, inquiry regarding the separation of rare earth elements (REEs) from a rare earth carbonate concentrate at the Energy Fuels Resources (USA) Inc. (EFRI) White Mesa Uranium Mill, San Juan County, Utah; Utah Radioactive Materials License No. UT 1900479. 1. INTRODUCTION First are my questions and your January 3, 2021, responses to my questions. I will not address the nature of the monazite sands that are being processed at the Energy Fuels EFRI White Mesa Mill. 1.1. Is the Division of Waste Management and Radiation Control (DWMRC) aware of this pilot project? DWMRC Response: As you are aware the uranium ore bearing rare earth materials in question is from the Chemours Mine in Georgia. The licensee is allowed to receive the ore without formal approval from the DWMRC because it is a native ore. The ore is being processed for uranium. In addition to the uranium, the licensee is recovering the rare earth materials, as well, in the form of a rare earth extract. 1.2. Is there a pilot project being carried out at the Mill to produce separated rare earth products? DWMRC Response: I know in early 2021 the Mill has been doing bench tests in their onsite Laboratory to ﬁgure out the solvent extraction process to produce separated rare earth products. I believe that some of the rare earth extract produced has been shipped to another facility to produce separated rare earth products. 1.3. Has the DWMRC approved such a pilot project? DWMRC Response: The DWRMC doesn't have a role in approving a rare earths "pilot project". This is a similar situation as the Mill processing uranium ore bearing vanadium from the Colorado Plateau. Uranium ore from the Colorado Plateau can also be found with high grade vanadium. In the past, when the price of vanadium went up to a decent level, the Mill has produced non-radioactive vanadium as known as “blackﬂake”. It is my understanding that the product EFR wants to produce with the rare earth materials is also non-radioactive. 1.4. Is Energy Fuels making changes to the Mill circuit(s) to produce separated rare earth products? DWMRC Response: It's our understanding, when they process the Chemours ore, they separate the uranium from the rare earth materials in the leach tanks. To do this they have added heaters to the leach tanks. Once the uranium and rare earth materials are separated, the uranium goes through the historic recovery process and rare earth materials go through new piping and centrifuges that are not part of the uranium recovery process. Any additions to the Mill are required to be included in the Mill's ﬁnancial assurance. Just like the Mill's vanadium circuit. Phil Goble/DWMRC 2 April 14, 2022 It is our understanding that they will need to update their Air Approval Order in order to produce the proposed rare earth material product on a large scale. 1.5. What NRC/DWMRC regulations and White Mesa License Conditions apply to pilot projects at the Mill? DWMRC Response: In this case as stated above, none. Other than ensuring whatever is added to the Mill is covered by ﬁnancial assurance. We can't speculate on what requirements may be required for future "pilot projects". 2. RARE EARTH ELEMENT PROCESSING AT THE WHITE MESA MILL 2.1. It is my understanding that Energy Fuels is allowed to have a side stream mineral recovery operation after the uranium is removed from uranium bearing ores. In the past, the owners of the White Mesa Mill have also removed vanadium, in addition to the uranium, before the efﬂuents and tailings are deposited into the tailings impoundments. Now, EFRI has a process to separate out a REE product, which they call a rare earth carbonate concentrate. That concentrate contains various rare earth elements (a group of seventeen metallic elements consisting of the ﬁfteen lanthanide elements along with scandium and yttrium). However, if EFRI processes that carbonate concentrate to separate out individual rare earth oxides or individual REEs from the carbonate concentrate, that is a different matter. This is not the same as separating out the single element of vanadium, which is not processed further at the Mill. In this case, EFRI is processing the concentrate further to produce new rare earth products. EFRI is no longer processing ore for its uranium and/or thorium content. EFRI is processing a rare earth concentrate for its individual rare earth elements. As far as I can determine, EFRI has not provided the Division of Waste Management with any information about the chemicals used, or may be used in the future, in the processing of the rare earth carbonate concentrate. Nor, have they provided information regarding the waste streams that have been, or will be, deposited in the liquid and solid tailings impoundments from this processing. 2.2. Recent news releases from Energy Fuels Inc. (EFI), the parent company of EFRI, describe possible processes that would be used to produce rare earth oxides, rare earth metals, and other rare earth products at the Mill. Phil Goble/DWMRC 3 April 14, 2022 2.2.1. The April 21, 2021, EFI News Release: “Energy Fuels and Hyperion Sign MOU for the Supply of Monazite to Produce Rare Earth Products,”1 discusses the EFRI plans to develop develop U.S. separation, metals, alloys, and other downstream REE capabilities at the White Mesa Mill, or nearby: In addition to producing mixed REE carbonate, Energy Fuels is also evaluating the potential to develop U.S. separation, metals, alloys, and other downstream REE capabilities at the White Mesa Mill, or nearby, thereby fully integrating a U.S. rare earth supply chain in the coming years. Energy Fuels is seeking to increase its supply of Monazite feed to approximately 15,000 tons per year (or greater) for this initiative. Subject to completion of permitting, development and commencement of operations, the Titan Project is expected to be a potential future source of Monazite to supplement Chemours' supply of Monazite to Energy Fuels. 2.2.2. The April 27, 2021, EFI News Release: “Energy Fuels Engages Leading Consultant to Support Development of Rare Earth Separation at White Mesa Mill in Utah,”2 discusses new possibilities for REE processing capabilities at the Mill, which include the production of separated REE oxides, REE metals, REE alloys, and other value-added REE products at the White Mesa Mill and the use of new separation and puriﬁcation technologies: As previously announced, Energy Fuels is evaluating the potential to produce separated REE oxides, REE metals, REE alloys, and other value- added REE products at the White Mesa Mill (or nearby), with the intent of creating a fully integrated U.S. REE supply chain in the coming years. Engaging Carester to prepare a scoping study represents the next step in Energy Fuels' development of these capabilities. Carester's REE separation and puriﬁcation techniques utilize proven liquid-to-liquid SX extraction processes that have been successfully deployed around the world to produce REE products from feeds including Monazite. Carester's team includes several individuals with signiﬁcant experience processing Monazite for the recovery of REEs in France, China and elsewhere. The White Mesa Mill has utilized SX technology to produce uranium and vanadium products since the facility was Phil Goble/DWMRC 4 April 14, 2022 1 https://www.energyfuels.com/2021-04-21-Energy-Fuels-and-Hyperion-Sign-MOU-for-the- Supply-of-Monazite-to-Produce-Rare-Earth-Products 2 https://www.energyfuels.com/2021-04-21-Energy-Fuels-and-Hyperion-Sign-MOU-for-the- Supply-of-Monazite-to-Produce-Rare-Earth-Products commissioned in 1980. Therefore, the Company believes that Carester's REE extraction processes can be incorporated into the Mill's existing infrastructure in an efﬁcient and cost-effective manner. The Carester team is widely recognized as one of the world's foremost authorities in producing separated rare earth oxides and other value added rare earth products. Rare earth extraction, separation and puriﬁcation can be complex. We believe that our extensive in-house processing experience, combined with Carester's expertise, places the Company in an excellent position to successfully and cost-effectively help to restore critical domestic rare earth capabilities in the USA at the White Mesa Mill. 2.2.3. The December 15, 2021, EFI News Release: “Energy Fuels Announces Strategic Venture with Nanoscale Powders to Develop Innovative Rare Earth Metal-Making Technology,”3 discusses the production of REE oxides, using a “molten sodium reduction of anhydrous REE chloride” process at the White Mesa Mill: The Company is also moving quickly toward producing REE Oxides at the Mill using proven solvent extraction ("SX") technologies. The Mill has over 40 years of experience producing uranium and vanadium oxides using SX technology. More recently, NSP has developed a process to create REE Metals from REE Oxides through molten sodium reduction of anhydrous REE chloride materials in a process similar to the Kroll process (called the "Hunter Titanium Process") which is used for the production of titanium metals through sodium reduction. The production of REE Metals utilizing the Technology will involve feeding anhydrous REE chloride materials, which are free of water, into a molten sodium bath. A rapid reaction takes place between the molten sodium and the REE chlorides. The process is highly exothermic, releasing energy, so the molten sodium acts to control the rate of the reaction. The reaction products are REE Metal and sodium chloride, commonly known as salt. 2.2.4. July 7, 2021, EFI News Release: “Energy Fuels and Neo Performance Materials Announce Contract Signing and Launch of Commercial Shipments of Rare Earth Product Phil Goble/DWMRC 5 April 14, 2022 3 https://www.energyfuels.com/2021-12-15-Energy-Fuels-Announces-Strategic-Venture-with- Nanoscale-Powders-to-Develop-Innovative-Rare-Earth-Metal-Making-Technology to Europe in Emerging U.S.-Based Rare Earth Supply Chain,”4 discusses EFI’s development of its own rare earth carbonate separation capabilities and adding metals, alloys, and rare earth permanent magnets manufacturing capabilities: In addition to supplying RE Carbonate to Neo, Energy Fuels is also evaluating the potential to develop its own separation capabilities at its White Mesa Mill in Utah (U.S.), or nearby, and possibly adding metals, alloys, and rare earth permanent magnets manufacturing capabilities. As a ﬁrst step, the Company has hired the French ﬁrm, Carester SAS, a leading global expert in rare earth separation and supply chains, to produce a scoping study including capital and operating costs for a full rare earth separations capability at the White Mesa Mill, which would be the next important step towards fully integrating a U.S. rare earth supply chain in the coming years, in addition to continuing to supply RE Carbonate to European markets over the long-term. 2.2.5. The July 29, 2021, EFI News Release: “Energy Fuels Announces Strategic Alliance with RadTran, LLC for the Recovery of Isotopes Needed for Emerging Cancer Therapeutics,”5 discusses the possible production of thorium-232 and radium-226 at the Mill. The Mill can represent a possible solution to this medical supply chain issue. The Mill is the only licensed and operating conventional uranium mill in the U.S., and it recently began production of RE Carbonate from natural monazite sands. Monazite sands, natural uranium ores, and certain other feed sources for the Mill contain thorium-232 ("Th-232") and radium-226 ("Ra-226"), which would normally be disposed of permanently in the Mill's tailings impoundments following processing for uranium and RE Carbonate recovery. As an initial step in this medical isotope initiative, Energy Fuels and RadTran will evaluate the technical and economic feasibility of recovering Th-232, and potentially Ra-226, from the Mill's natural monazite and other existing feeds, subject to receipt of any required licenses, permits and regulatory approvals. Phil Goble/DWMRC 6 April 14, 2022 4 https://www.energyfuels.com/2021-07-07-Energy-Fuels-and-Neo-Performance-Materials- Announce-Contract-Signing-and-Launch-of-Commercial-Shipments-of-Rare-Earth-Product-to- Europe-in-Emerging-U-S-Based-Rare-Earth-Supply-Chain 5 https://www.energyfuels.com/2021-07-29-Energy-Fuels-Announces-Strategic-Alliance-with- RadTran,-LLC-for-the-Recovery-of-Isotopes-Needed-for-Emerging-Cancer-Therapeutics 2.2.6. The March 15, 2022, EFI News Release “Energy Fuels Announces 2021 Results, Including Net Proﬁts, Strong Cash Position, and Market-Leading U.S. Uranium, Rare Earth and Vanadium Position”6 discusses REE separation and new REE processing technologies at the Mill: In addition to supplying RE Carbonate to Neo, Energy Fuels also announced it is evaluating the potential to develop its own separation capabilities at the Mill, or nearby, and possibly adding metals, alloys, and REE permanent magnets manufacturing capabilities. As a ﬁrst step, the Company hired the French ﬁrm, Carester SAS (“Carester”), a leading global consultant in the production of separated REE products, to produce a scoping study, including capital and operating costs needed for full commercial scale REE separations capability at the Mill, which would be the next important step towards fully integrating a U.S. REE supply chain in the coming years, in addition to continuing to supply RE Carbonate to European markets over the long-term. Based on the results of the scoping work, the Company is evaluating installing a full separation circuit at the Mill to produce both “light” and “heavy” separated REE oxides in the coming years, subject to successful licensing, ﬁnancing, and commissioning and continued strong market conditions, and has hired Carester to support these REE separation initiatives. *** On December 15, 2021, the Company announced the execution of an MOU with Nanoscale Powders LLC (“NSP”) for the development of a novel technology for the potential production of REE metals, subject to the ﬁnalization of deﬁnitive agreements. Producing REE metals and alloys is a key step in a fully integrated REE supply chain, after commercial production of separated REE oxides and before the manufacture of neodymium iron boron (“NdFeB”) magnets used in electric vehicles, wind generation and other clean energy and advanced technologies. The production of REE metals utilizing this technology would involve feeding anhydrous REE chloride materials, which are free of water, into a molten sodium bath. A rapid reaction takes place between the molten sodium and the REE chlorides. The process is highly exothermic, releasing energy, so Phil Goble/DWMRC 7 April 14, 2022 6 https://www.energyfuels.com/2022-03-15-Energy-Fuels-Announces-2021-Results,-Including- Net-Proﬁts,-Strong-Cash-Position,-and-Market-Leading-U-S-Uranium,-Rare-Earth-and- Vanadium-Position the molten sodium acts to control the rate of the reaction. The reaction products are REE metal and sodium chloride, commonly known as salt. The Company believes the NSP sodium reduction of REE metals has several advantages over the industry standard REE metal making method, which utilizes electrolytic reduction of REE oxides in molten lithium ﬂuoride/REE ﬂuoride baths. First, the NSP process does not have any associated air emissions, and therefore presents a signiﬁcant improvement over the current technology, which emits carboﬂuoromethane (CF4) gas, which is a powerful greenhouse gas emitter. Second, it does not consume graphite crucible materials and is expected to utilize signiﬁcantly less energy and labor. Finally, the NSP process requires anhydrous chloride feeds, which we believe can be generated directly from rich liquor streams coming from the Mill's planned REE separations circuit. This could eliminate the need for oxalate precipitation and calcination of materials destined for REE metal making. As a result of these factors, the Company believes operating costs could potentially be signiﬁcantly less than conventional REE metal-making methods. 2.2.7. The April 13, 2022, EFI News Release, “Energy Fuels Hits Critical Mineral 'Trifecta' in Rare Earths, Uranium & Vanadium; Now Performing Commercial-Scale Partial Rare Earth Separation,”7 discusses production of partially separated REE carbonate at the Mill. The News Release also discusses the submittal of an application to the DWMRC for commercial "light" REE separation infrastructure at the Mill in 2022 or 2023. The Company is pleased to announce that it has begun partial commercial-scale REE separations at its White Mesa Mill, located near Blanding, Utah (the "Mill") utilizing existing Mill facilities. As a result, the Company is now producing a more advanced REE Carbonate than it did in 2021. The Company utilized an existing solvent extraction ("SX") circuit at the Mill to remove most of the lanthanum ("La") and produce an advanced cerium ("Ce")-plus REE Carbonate. This product is roughly 32% - 34% neodymium-praseodymium ("NdPr") and 1.8% terbium ("Tb") and dysprosium ("Dy") on a % TREO basis. *** The Company is also pleased to announce that it is making progress on its Phil Goble/DWMRC 8 April 14, 2022 7 https://www.energyfuels.com/2022-04-13-Energy-Fuels-Hits-Critical-Mineral-Trifecta-in-Rare- Earths,-Uranium-Vanadium-Now-Performing-Commercial-Scale-Partial-Rare-Earth-Separation lab-scale REE separation pilot program. Lab-scale piloting began in 2021 and is ongoing. The Company has achieved production of a high-purity mixed NdPr oxide from its lab-scale pilot. A sample of NdPr oxide will be sent to Neo for further evaluation with the intent to sell this product as well as other separated oxides to Neo or others in the future. Through the operation of this pilot program, speciﬁc design criteria, as well as reagent costs, are being evaluated, which to date, are within initial expectations. REE separation piloting is expected to continue throughout the rest of 2022, which will also allow the Company to evaluate separation of the heavy REEs (samarium ("Sm")-plus). Energy Fuels has also formally engaged the French consulting ﬁrm, Carester SAS ("Carester"), to perform more detailed scoping, cost estimation, permitting support, technical support, and design for commercial "light" REE separation infrastructure at the Mill. The Company is currently preparing an application to the State of Utah, which it expects to submit in late 2022 or in early 2023. The Company plans to be in a position to initially produce up to 10,000 tonnes of total REE oxides ("TREO") by 2025 or 2026. The preliminary, high-level scoping work Carester performed for Energy Fuels in 2021 estimated capital and operating costs to install and operate a "light" separation infrastructure at the Mill capable of producing 10,000 tonnes TREO per year, which are in line with the Company's initial expectations. The Company's expanded collaboration with Carester will include validation of these numbers. If conﬁrmed, Energy Fuels expects to be among the lowest cost REE producers in the world, while also recovering uranium and possibly thorium. Energy Fuels is also evaluating the production of "heavy" REE oxides, including Dy and Tb, which could occur by 2027 or 2028. 2.2.8. The March 15, 2022, EFI submittal, “United States Securities and Exchange Commission, Washington, D.C. 20549; FORM 10-K, Annual Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the ﬁscal year ended December 31, 2021,”8 also discusses the production Th-232, Ra-228, Th-228 and Ra-226 at the Mil. Under its strategic alliance with RadTran, the Company is evaluating the feasibility of recovering Th-232 and Ra-226 from its existing RE Carbonate and uranium process streams at the Mill and, together with Phil Goble/DWMRC 9 April 14, 2022 8 https://www.sedar.com/GetFile.do? lang=EN&docClass=7&issuerNo=00004321&issuerType=03&projectNo=03350832&docId=515 5065 RadTran, is evaluating the feasibility of recovering Ra-228 from the Th-232 and Th-228 from the Ra-228 and concentrating Ra-226 to commercial speciﬁcations at the Mill using RadTran technologies. *** Activities being undertaken by the Company at this time include evaluations of the technical feasibility of recovering Th-232, Ra-228 and Th-228 from the Mill’s RE Carbonate process streams, and Ra-226 from the Mill’s uranium process streams; the permitting and licensing required to separate and recover Th-232, Ra-228, Th-228 and Ra-226 at the Mill; and the commercial feasibility of this project. 3. LICENSE AMENDMENT APPLICATIONS 3.1. It is apparent from EFI statements above that the company anticipates the need to submit license amendment application to the Division to produce both “light” and “heavy” separated REE oxides and other possible rare earth production and manufacturing capabilities. 3.2. Apparently, the Division thinks that the further processing of a rare earth carbonate concentrate at the Mill are processing operations that fall within the current Mill License, the Atomic Energy Act, Nuclear Regulatory Commission (NRC) and Environmental Protection Agency (EPA) regulations applicable to licensed uranium mills, and the Mill’s various environmental analyses. Yet, there is no documentation of such determinations by the Division. The public does not know what the separation of rare earth oxides from a rare earth carbonate concentrate actually entails, what chemicals are being used in the extraction processes, what wastes are being produced, and how this type of processing and the wastes produced comply with the Mill license and applicable regulations. 4. WHITE MESA MILL LICENSE CONDITION 9.4. 4.1. License Condition 9.4 of the White Mesa Mill License states: 9.4. A. The licensee may, without prior Director-approval, and subject to the conditions speciﬁed in Part B of this condition: (1) Make changes in the facility or process, as presented in the application. (2) Make changes in the procedures presented in the application. (3) Conduct tests or experiments not presented in the application. Phil Goble/DWMRC 10 April 14, 2022 B. The licensee shall ﬁle an application for an amendment to the license, unless the following conditions are satisﬁed. (1) The change, test, or experiment does not conﬂict with any requirement speciﬁcally stated in this license, or impair the licensee’s ability to meet all applicable regulations. (2) There is no degradation in the essential safety or environmental commitments in the license application or provided by the approved reclamation plan. (3) The change, test, or experiment is consistent with the conclusions of actions analyzed in the most recent Environmental Assessment conducted by the Division from the last license renewal and/ or major license amendment. C. The licensee's determinations concerning Part B of this condition shall be made by a “Safety and Environmental Review Panel (SERP).” *** D. The licensee shall maintain records of any changes made pursuant to this condition until license termination. These records shall include written safety and environmental evaluations, made by the SERP, that provide the basis for determining that changes are in compliance with the requirements referred to in Part B of this condition. The licensee shall furnish, in an annual report to the Director, a description of such changes, tests, or experiments, including a summary of the safety and environmental evaluation of each. In addition, the licensee shall annually submit to the Director changed pages to the Operations Plan and Reclamation Plan of the approved license application to reﬂect changes made under this condition. Annual reports shall address the previous calendar year and be submitted no later than March 31 each year.9The licensee’s SERP shall function in accordance with the most current version of the standard operating procedures submitted by letter to the Director dated February 27, 2007. [Applicable UDRC Amendment 3][Applicable UDRC Amendment: 8 Renewal] 4.2. Currently, there is no information available to the public about the possible reagents being used at the Mill to separate REEs or the wastes produced from those processes that are speciﬁc to the REE processing. Some of that information might be available in the Annual Technical Evaluation Report (ATER) for 2021. The DWMRC has yet to post that documents on the Department of Environmental Quality E-Z Docs system. It does not appear Phil Goble/DWMRC 11 April 14, 2022 9 According to License Condition 9.4, the Annual Technical Evaluation Report for 2021, is due on March 1of the following year., 2022, that the Division posts the ATERs on the webpages for the White Mesa Mill.10 It is hard to understand why the Division does not post the ATERs with other reports that are required to be submitted to the Division every year on the Division’s webpage for the Mill. I have submitted a GRAMA request for the 2021 ATER. 5. CONCLUSION AND QUESTIONS 5.1. It is clear that EFRI intends to develop new processes at the Mill to process a rare earth carbonate concentrate to separate individual rare earth oxides and elements and to separate other radionuclides from monazite ores. These processes are not associated with the processing of ore for its uranium and/or thorium content. What is not clear is when the Division will say, “Wait a minute! Maybe the wastes from these new REE separation processes do not meet the deﬁnition of 11e.(2) byproduct material, and the regulations promulgated by the NRC and the EPA in response to the Uranium Mill Tailings Radiation Control Act never anticipated these kinds of mineral processing operations at a licensed uranium mill.” 5.2. What types reagents were used for the partial commercial-scale REE separations at its White Mesa Mill, utilizing existing Mill facilities, to remove most of the lanthanum ("La") and produce an advanced cerium ("Ce")-plus REE Carbonate and for the production of other REE products? 5.3. What types of wastes have been produced by the pilot separation and partial commercial-scale REE separations at its White Mesa Mill, utilizing existing Mill facilities? 5.4. Is there a legal opinion by the State of Utah that afﬁrms that 1) the new REE processing operations fall within the deﬁnition of uranium milling and 2) any wastes produced by these mineral extraction processes (whether or not the wastes are similar physically and chemically to existing wastes produced at the Mill) are deﬁned as 11e.(2) byproduct material? 5.5. Has the Division made a determination that the changes in the Mill’s processing operations to produce REE products, including pilot testing, satisﬁed the conditions set forth in License Condition 9.4B: (1) The change, test, or experiment does not conﬂict with any requirement speciﬁcally stated in this license, or impair the licensee’s ability to meet all applicable regulations; (2) There is no degradation in the essential safety or environmental commitments in the license application or provided by the approved reclamation plan; and (3) The change, test, or experiment is consistent with the conclusions of actions Phil Goble/DWMRC 12 April 14, 2022 10 https://deq.utah.gov/waste-management-and-radiation-control/energy-fuels-resources-usa-inc analyzed in the most recent Environmental Assessment conducted by the Division from the last license renewal and/or major license amendment? 5.6. Has the Division ever considered the fact that EFI is attracting investors by making statements in its News Releases about new REE processes at the Mill and those processes might not be legal at a licensed uranium mill under the Atomic Energy Act and NRC and EPA regulation? Thank you for your response to these questions. Please let me know if you have questions or need clariﬁcation about the statements or questions in this letter. Sincerely, /s/ Sarah Fields Program Director sarah@uraniumwatch.org cc: Doug Hansen, Director, DWMRC Phil Goble/DWMRC 13 April 14, 2022