The company estimates that Mount Emmons holds one of the highest grade primary molybdenum deposits in the world.
Federal approval from the U.S. Forest Service has been granted to U.S. Energy Corporation's molybdenum mine planned to open on Mount Emmons, near Crested Butte, Colo. This has brought the plan a step closer to realization, after a lengthy battle that took decades just to reach this stage, the Denver Post has reported.
In fact, the fate of the molybdenum mine is still not set in stone. This is a preliminary decision, commented Lee Ann Loupe, a spokeswoman for the U.S Forest Service. Determining the next steps will take time as it is a long process, she added. Representatives of the company and the U.S. Forest Service are expected to meet over the next few weeks to discuss the project and talk about the next stages of the project, Loupe stated.
U.S. Energy Corp., headquartered in Riverton, Wyo., also drills for oil and gas and has a market capitalization of $42 million. It posted a loss in 2012, according to corporate filings. The company has been attempting to start mining operations on Mount Emmons since the 1970s. The company estimates that Mount Emmons holds one of the highest grade primary molybdenum deposits in the world. Construction works would create about 1,000 jobs, the company believes. U.S. Energy has assessed that its mine would produce up to 12,600 tons of ore per day in an underground molybdenum mine with a 33-year operational life. The mine would produce 8,500 tons of ore per day in the first year of operation, reaching its full capacity by the fourth year, the company explained on its website.
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Based on these production capacity plans, U.S. Energy estimates that the overall development of the higher grade ore deposits is expected to produce 22 million pounds of molybdenum in the first year before peaking at 27 million pounds by the third year. It will settle at an average of 17 to 20 million pounds per year afterwards, U.S. Energy explained. The ore crushing facility is planned to be located underground to reduce noise and material handling requirements, the company said.
This project, however, has been opposed by local residents and environmentalists. Crested Butte has a population of 1,500 and has developed as a ski resort and a popular leisure destination. The Red Lady Coalition, a group of local businesspeople and landowners opposed to the plan, believe that mining operations would not benefit the area and would have an adverse effect on the local economy.
In 2012, U.S. Energy entered negotiations with the Red Lady Coalition, another opposition group, the High Country Citizens Alliance, and town officials to discuss a possible federal land swap. Negotiations failed at that point but U.S. Energy president Mark Larsen commented that a swap was still a possibility. The working relationship established with the people in Crested Butte was very good and the company hoped it could continue to work together with the community, he added.