May 2--It operated only for a few months a quarter century ago, but the rising price of uranium has prompted a Canadian mining company to buy the Shootaring Canyon Uranium Mill north of Lake Powell.

U.S. Energy Corp. said Tuesday it sold the mothballed mill near Ticaboo, along with 38,000 acres of mineral claims and leases, to sxr Uranium One Inc. The mining parcels include the Sage Mine in San Juan County, near the Utah-Colorado border, and eight r nine other properties in the Lisbon Valley, southeast of Moab, and the Henry Mountains, northwest of Ticaboo. For those properties, Riverton, Wyo.-based U.S. Energy will receive $6.6 million in cash and 6 million shares of Uranium One common stock. Uranium One also has pledged to pay U.S. Energy $20 million, if and when the Shootaring Canyon mill ever returns t commercial production; $7.5 million in cash 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.

In addition, Uranium One assumed reclamation responsibilities for the mill and mining properties. "We're delighted to become a shareholder in Uranium One," said Mark Larsen, U.S. Energy's president and chief operating officer. "It's a top-notch company. They'll do a great job for the state of Utah." If, that is, Uranium One can ever reopen the mill, which is far from a certainty. "Hope springs eternal," said Garfield County Commissioner Maloy Dodds. "We've had a whole lot of interest in uranium in the last year. Everybody's filing claims and refiling claims. We've had more filings in the last year than in the past 20 years." Throughout those 20 years, the Shootaring Canyon mill has been on standby.

The last uranium mill built in the United States, it had barely started operations in 1982 when the price of uranium collapsed, forcing a shutdown. The price of uranium had built back up to $10.75 per pound in early 2003. By mid-2006, the price had risen to about $45 per pound. Today, the price is approaching $115 per pound. U.S. Energy has served as the mill's caretaker since buying it in 1993, monitoring the site and doing required maintenance. About two years ago, however, the company began submitting materials to the state Division of Radiation Control in hopes of event ally securing a permit to resume operations, said division director Dane Finerfrock.

One problem with the Shootaring Canyon mill is that it does not have a power supply. Diesel-powered generators are required to operate it, Dodds noted, making it too expensive for most companies. Garfield County has funded a study into extending electricity to Ticaboo. Dodds said the most likely scenario would involve hooking into Garkane Energy Cooperative Inc.'s power line in Hanksville. A shorter connection -- to a power line near Boulder in ayne County -- would encounter insurmountable environmental roadblocks because it would cross Capitol Reef National Park or wilderness study areas, he added.

Environmental advocates are keeping tabs on what is happening. Steve Bloch, a staff attorney with the Southern Utah Wilderness Alliance, said "we're watching this version of the so-called uranium boom -- what is this, the third boom? -- closely and with some trepidation about what it means for some of Utah's stunni g redrock country." Although "worrisome," uranium-oriented transactions such as the Shootaring Canyon mill sale remain largely speculative ventures, he added. "We'll see what pans out at the end of the day." Even Utah Mining Association President David Litvin is not certain how to evaluate the prospects of the mill ever processing again.

"With minerals, if you can't process them at a profit, they're just dirt," he said. "The high price of uranium has made properties more attractive. But whether this leads to immediate development, I don't know. Obviously, sxr Uranium One thought there w s some benefit to owning these properties."