Uranium firm takes virus aid, says crisis hasn’t affected business

Ur-Energy Inc. received $893,300 through two subsidiaries during first round of Paycheck Protection Program loans

Energy Secretary Dan Brouillette is pictured during his confirmation hearing before the Senate Energy and Natural Resources Committee on Nov. 14, 2019.  (Bill Clark/CQ Roll Call file photo)
Energy Secretary Dan Brouillette is pictured during his confirmation hearing before the Senate Energy and Natural Resources Committee on Nov. 14, 2019. (Bill Clark/CQ Roll Call file photo)
Posted May 7, 2020 at 6:00am

A Colorado uranium company that pressed the Trump administration to set up barriers against imports and found allies for that cause in Congress received a nearly $1 million loan for relief from the coronavirus pandemic even as it said the tumbling economy had not affected its flagship operation. 

Ur-Energy Inc. received $893,300 through two of its subsidiaries during the first round of loans the federal government distributed in its Paycheck Protection Program. 

Under the PPP, small businesses that have been affected by the pandemic and government-mandated shutdowns can get forgivable loans for payroll, rent, utility and mortgage payments as long as at least 75 percent of the loan goes to payroll.

Small businesses are traditionally considered to have 500 employees or fewer, but the Small Business Administration has made exceptions during the pandemic. Ur-Energy employed 13 people in Colorado, five in Wyoming and one in Arizona last year, according to its latest annual report.

In an April 20 news release about the loan, Ur-Energy said the pandemic has not altered activities at its flagship facility, Lost Creek, a mining site in Wyoming. The SBA has not made individual loan applications public.

“At this time, the COVID-19 pandemic has caused no interruption of our production operations at Lost Creek and did not interfere with our scheduled delivery and sales into term contract commitments in early February and again in early April,” the company said.

Ur-Energy did not respond to a voicemail or email to its corporate office seeking comment for this article. CEO Jeffrey Klenda and CFO Roger Smith did not respond to questions submitted repeatedly by email. 

As the pandemic has killed tens of thousands of Americans, gripping the nation and dragging down its economic fortunes, demand for PPP loans has soared, and those loans have often found their way to energy companies with ties to the Trump administration, including in the uranium industry.

The first round distributed $349 billion in loans but ran out in mid-April, and the second PPP cycle is close to running out of money too.

Speaking last week on CNBC, Treasury Secretary Steven Mnuchin said, “We’re going to do a full audit of every loan over $2 million.”

At least one other firm in the small, domestic uranium mining business, Westwater Resources Inc., has received PPP money. Westwater subsidiary URI Inc. received a $330,935 loan on Monday, records show. Westwater has rights to idled uranium sites in Texas and New Mexico.

Trump’s support

The administration has sought to support the domestic uranium industry since President Donald Trump assumed office.

In 2018, Ur-Energy and Energy Fuels Inc., the other significant U.S. uranium miner in the industry, petitioned the Commerce Department to investigate if foreign uranium imports were a threat to national security. 

The department found they were, and Trump created the Nuclear Fuel Working Group. Energy Secretary Dan Brouillette unveiled a report in late April from that body, calling for barriers against certain imports from Russia and China.

The pair of companies, along with lawmakers from Western states, have argued the U.S. is too reliant on uranium imports from Russia, China and Kazakhstan.

Canada and Australia accounted for 24 and 18 percent, respectively, of uranium in the American market in 2018, according to the Energy Information Administration, while 10 percent was domestic. Twenty percent came from Kazakhstan and 13 percent from Russia, EIA figures show.

In his fiscal 2021 budget, Trump requested $150 million to create a national uranium stockpile, part of a $1.5 billion effort that the administration proposed for the next decade.

The domestic uranium industry was struggling before the pandemic hit. After making a profit in 2018, Ur-Energy Inc. reported an $8.4 million net loss for 2019. Energy Fuels lost money in 2019, and Westwater reported a $10.6 million loss for 2019 and a $35.7 million loss the year before.

Interior Secretary David Bernhardt performed “legal services” for one of Ur-Energy’s subsidiaries from 2009 to 2012. 

The company also paid Faegre Drinker Biddle & Reath LLP, where EPA Administrator Andrew Wheeler worked as a lobbyist before joining the administration, $20,000 to lobby on federal topics in the first three months of the year, including on “COVID-19 response related issues” and the $2 trillion coronavirus aid legislation.

Faegre Drinker Biddle & Reath also signed Energy Fuels as a client and received $30,000 in the first quarter this year for its lobbying efforts, including on coronavirus-related stimulus legislation.

Connections, donations

As a lobbyist, Wheeler represented Energy Fuels as it pushed Interior to change the boundaries of Bears Ears National Monument in Utah. 

After Brouillette released his report last month, Klenda, the CEO of Ur-Energy, said the U.S. government should start buying uranium this year.

Since 2017, Klenda has donated $1,000 to campaigns of Rep. Liz Cheney, R-Wyo., and $2,000 to Sen. John Barrasso, R-Wyo., chairman of the Senate Environment and Public Works Committee. Both lawmakers supported Commerce’s initial investigation of uranium imports.

At least five other corporate officers at Ur-Energy have donated $4,500 to congressional Republicans, including Barrasso, Cheney and Sen. Ted Cruz of Texas, during that period.

The U.S. coal industry, which has contracted dramatically in recent years as mining companies filed for bankruptcy, has also received coronavirus loans.

Hallador Energy, an Indiana coal company, received $10 million from the PPP. It hired former EPA Administrator Scott Pruitt in 2019 to lobby state politicians. Pruitt is still registered to lobby in the state, filings show.

At least two other coal companies with connections to the Trump administration received millions in PPP loans. Rhino Resources, which received $10 million in loans, counted David Zatezalo as corporate officer before he joined the administration as the head of the Mine Safety and Health Administration. Kentucky coal miner Ramaco Resources secured loans worth $8.4 million.

Ramaco CEO Randall Atkins is on the National Coal Council, an advisory board to the Energy Department.

FiscalNote, the parent company of CQ Roll Call, received a loan under the Paycheck Protection Program.