A New York-based energy firm said today one of the country's largest discoveries of high-grade uranium has been made in the tobacco fields of southern Virginia.
After more than three years of exploratory drilling, the Marline Uranium Corp. said preliminary findings indicate that about 30 million pounds of uranium oxide, about twice as rich as average U.S. commercial mining deposits, lies beneath a handful of farms off an isolated dirt road in this community of 1,550, about 20 miles north of Danville.
Marline officials said that there is a "definite potential" for further finds. "This could potentially be the largest, most economical discovery in the United States," said Daniel C. Idzal, Marline's executive vice president and chief operating officer.
While confirming the relative magnitude of Marline's find, government and industry experts today noted that it comes at a time of severe depression in the uranium industry. As the demand for nuclear power has tapered off, spot market prices for uranium have dropped from $43 a pound three years ago to about $20 and about 4,000 uranium miners in Western states -- about half the U.S. work force -- have been laid off.
Industry experts cautioned that it is too early to determine the economic value of Marline's discovery. Company officials said they are banking on a future upswing in worldwide demand that eventually will support a $200 million mining and milling operation in the area, an action that would make Virginia the first uranium-producing state east of the Mississippi River.
The discovery sets the stage for what is likely to be a showdown between industry and environmentalists when the Virginia General Assembly convenes next January in Richmond.
"I hope that this makes people realize that this really is an issue in Virginia," said Velma Smith a spokesman of the Piedmont Environmental Council in Warrenton. "We're talking about potentially some major land disruption and substantial ground water disruption that could impact a lot of people for many many years."
At the behest of environmental groups, the legislature this year imposed a moratorium through July 1, 1983, on uranium mining permits. Marline officials, who have invested over $20 million in Virginia and hired two of the state's premier lobbyists, insisted today that any further delay would spell disaster for the project.
Last week, the company, which has disputed the environmentalists' claims, won its first major victory when a state uranium study panel voted 7 to 1 to instruct its staff to begin drafting legislation to lift the moratorium.
"Trying to work out a bill next year with a short (30-day) session -- it's going to be horrible," said Smith. "They're trying to hurry things far faster than they should be. The General Assembly should not be rushed into doing a bandaid job."
But if central Virginia groups remain concerned, not so the people in Chatham, the county seat of Pittsylvania County on the North Carolina border. Marline's announcement today was greeted with applause from about 50 residents who gathered at the local community center to hear the long-awaited news. Many said later that given the slumps in the tobacco and textile industries, the two staples of the local economy, the prospect of uranium mining was welcome news.
"This is exciting," said Dan Sleeper, Pittsylvania County administrator. "You're talking about $200 million and 900 jobs -- that's a substantial boost for the economy. I can't see where there's going to be any major opposition to it."
Dr. Claude Whitehead, chairman of the county supervisors, noted that the board already has passed resolutions welcoming Marline and rejecting a mining moratorium. "We sent one of our members out to Texas to see some mining operations and he was pretty well satisfied in his mind that it could be done safely," Whitehead said. "This is a tremendous opportunity for the area."
There was more skepticism from Walter Coles, a 73-year-old tobacco farmer who is one of 400 area residents who have leased mineral rights to Marline. The bulk of Marline's 100-acre discovery lies under Cole's land. The company's leases call for royalty payments of seven percent of the total value of minerals taken from a site. Coles had little to say about the prospects when approached outside the old colonial home on his farm.
"It don't mean a damn thing to me today," he said. "If I would have had it 30 years ago it would have been all right."
The discovery caps a search for uranium that began in the mid 1970s when Department of Energy researchers, flying low-level aircraft, picked up radioactive emissions in some parts of Virginia. Gambling that the emissions were an indication of uranium deposits, Marline sent employes swarming over Pennsylvania and some central Virginia counties, some as far north as Culpeper, Fauquier, and Orange, with hand held scintillometers, a sophisticated geiger counter.
The company has leased over 55,000 acres, opened up offices in Danville, Culpeper and Richmond, and hired an army of lawyers, consultants and public relations experts. To handle its Richmond lobbying, the firm has retained Edward E. Lane, a former Democratic chairman of the House Appropriations Committee, and William A. Royall, the former press secretary to Republican Gov. John N. Dalton.
Marline Uranium is a subsidiary of the Marline Oil Corp., a relatively small oil and gas company that had 1981 revenues of $13.7 million and has less than 50 employes, most of them based in Houston, Tex., according to its most recent annual report and company officials.
David Thomas, the chief of the Department of Energy's uranium resources division, said that the 30 million ton discovery by itself would place Virginia about fifth in the country in terms of proved uranium reserves, just below New Mexico, Wyoming, Texas and Colorado. New Mexico and Wyoming each have about 400 million tons of uranium reserves.
More potentially significant was the reported richness of the Marline find -- a key factor in determining its economic value. The average U.S. commercial deposit last year had a grade of 2.4 pounds of uranium for each ton of ore extracted. Marline said that its find was "in excess" of four pounds per ton of ore.