Nuclear Horizon: An atomic economy is booming in New Mexico Santa Fe Reporter


On April 27, Greg Mello--a tall, intense man whose natural state is vague dishevelment--was in court, watching his witness annihilate (at least in Mello’s view) the US Department of Energy’s case.

Mello is the Harvard-educated co-founder and executive director of the Los Alamos Study Group, a nuclear disarmament advocacy organization based in Albuquerque, but with a concerted focus on the activities of Los Alamos National Laboratory. Last year, LASG sued to stop the construction of the Chemistry and Metallurgy Research Replacement (CMRR) project, a new facility at LANL designed to process--and possibly produce--plutonium-based nuclear warheads. 

On this particular Wednesday, Mello’s lawyer had called Frank von Hippel, a nuclear physicist and Princeton professor, to testify against the facility--essentially a costly, heavily fortified nuclear warhead processing facility situated over a geologic fault zone (see sidebar: “Price Point”).

In his prepared testimony, Von Hippel argued the need for new warheads “has vanished”; the earthquake hazard is now “much larger” than previously thought; the last full environmental assessment of the project--completed eight years ago--is insufficient for a project whose cost has swollen from $350 million to more than $3 billion.

All of this, Von Hippel says, amounts to a more fundamental question: Does New Mexico really need to be researching and building new nuclear weapons?

Mello doesn’t think so--but says the political momentum isn’t on his side.

“New Mexico is viewed as a place with a compliant government, where nuclear contractors can get federal money,” Mello explains. “There’s no private sector demand for most of this stuff, and a great deal of it could never be licensed or permitted.”

Even so, the CMRR facility--along with its budget--has expanded virtually unheeded since it was first proposed in 1999. 

“It’s terrifying,” Mello says. “It’s frightening for New Mexico, both in itself and because of what it’s not: renewable energy; investment in our housing and building stock, our infrastructure, our schools. A very tiny group of people have captured an outsize amount of attention from a political elite and are setting far too much of our agenda.”

Greg Mello of Los Alamos Study Group is challenging the lab's new plutonium facility.

Within Santa Fe, Mello’s view is relatively common. At the LASG meetings and study sessions he hosts in the basement of a local church, attendees are routinely knowledgeable to the point of expertise. And in addition to various environmental protection and renewable energy groups, Santa Fe also hosts two other nuclear disarmament organizations, Concerned Citizens for Nuclear Safety and Nuclear Watch of New Mexico.

Southern New Mexico, though, is a different story. There, lawmakers and academics extol the virtues not only of nuclear research and development, but they also court uranium processing plants and waste disposal facilities with gusto--and, in some cases, financial incentives.

In fact, the morning of Von Hippel’s testimony, a collection of public officials, scientists and executives had gathered in a conference room in Hobbs, some 350 miles south of Santa Fe. They were discussing New Mexico’s future as a focal point for the new nuclear age, in which economies rely increasingly on nuclear power and entire processing industries spring up around the “uranium fuel cycle,” which begins with mining and ends with waste disposal. Every stage of that process can be monetized--and nearly every stage has commercial operations in New Mexico.

“The state currently has a stake in a lot of aspects of this cycle--the mining, the enrichment, the storage,” Mat Lueras, vice president for corporate development at Uranium Resources Inc., a mining outfit that owns 183,000 acres of uranium mineral rights in New Mexico, tells SFR. Because of that, Lueras says, URI has “seen widespread local and state support from New Mexico politicians” for its efforts to restart uranium mining.

To Daniel Fine, a research associate at New Mexico Tech and at the Center for Energy Policy in Hobbs,
such enthusiasm is simply an acknowledgment of the inevitable.

“Nuclear energy, worldwide and in the United States, has a very strong future,” Fine says. “Twenty percent of our electricity is nuclear. There’s potential planning for 50 percent more.”

In Fine’s view, New Mexico’s role in that future remains to be determined. But given what’s already here, and the gradual buildup of a nuclear fuel cycle complex in the state’s southeastern counties, a nuclear future may indeed be unavoidable. Take the beginning of the fuel cycle, for instance.

“New Mexico,” Fine says, “is the Saudi Arabia of uranium.”

Daniel Fine of New Mexico Tech predicts a bright future for nuclear energy.

New Mexico had its first exposure to the nuclear industry in 1943, with the founding of Los Alamos National Laboratory. Two years later, near Alamogordo, LANL scientists conducted the Trinity test with a prototype of the atomic bombs that, less than a month later, would raze Hiroshima and Nagasaki. Sandia National Laboratories, the Albuquerque lab charged with turning LANL’s nuclear weapons concepts into deployable missiles, was founded in 1949.

While the labs were located near northern New Mexico’s population centers, less populous areas of the state became nuclear hubs in their own right. In southern New Mexico, a huge swath of desert scrubland became the White Sands Proving Groundsnow the White Sands Missile Rangefor nuclear weapons testing. In far western New Mexico, on the outskirts of the Navajo Nation, uranium mines sprang up in the 1950s.

Since the US government promised to buy all mined uranium, it was good business, and northwest New Mexico’s mining industry boomed for close to two decades with relatively little oversight. But in the 1970s, reports of elevated levels of radon, a radioactive element that can cause cancer, began to surfaceand so began what Fine calls “the sad chapter” of widespread radioactive contamination from New Mexico’s uranium mines.

“[Uranium] mining, from the 1950s to the early 1970s, was very high risk, and the methods then did expose uranium miners to radioactivity,” Fine says. 

In 1979, conditions worsened considerably: A dam belonging to United Nuclear Corp. broke, spilling more than 1,000 tons of contaminated tailings into the Rio Puerco, a tributary of the Rio Grande. By 1990, the last of New Mexico’s uranium mines had closed.

Enter URI, which since 1977 had been buying up old uranium mines. With a lengthy permitting process and a court challenge behind it, Lueras says URI plans to restart mining activity in New Mexico as soon as 2013.

According to Lueras, the nation--if not the world--demands it.

Even if the US doesn’t expand its nuclear power profile--which consists of 104 operational reactors--only approximately 10 percent of US uranium needs are supplied domestically. A treaty that provides for additional enriched uranium from Russia is set to expire in 2013--meaning many companies, like URI, are banking on expanding domestic demand for both raw and enriched uranium.

“We can be a US producer, producing US uranium for use in US commercial reactors,” Lueras says. “We see a strong market out there.”

Demand is also growing as other nations--China, India, South Africa--build up their nuclear power portfolios.

“We have the largest supply of uranium in the country,” Lueras says: more than 101 million pounds of proven uranium reserves, with potential for up to 600 million pounds in the Grants mineral belt alone.

At uranium’s current price, approximately $56 per pound, that’s $5.7 billion in potential income for URI--not to mention, Fine notes, royalties for the state.

“Very ironic that New Mexico is sitting on probably the ninth-largest deposit of uranium in the world--and the United States imports its uranium,” Fine says. “If we are dependent on foreign oil, we are even more dependent on foreign uranium.”

Still, to local residents, the market potential isn’t worth the risk.

“They talk about jobs--BS!” former uranium miner Larry King says. King serves on the board of Eastern Navajo Diné Against Uranium Mining, an organization dedicated to stopping URI in its tracks (see sidebar, “Miner Issue”).


After uranium is mined, it must be transported to a conversion facility, where it is transformed into a purified, liquid form. (The US has only one such facility, run by defense contractor Honeywell International in Metropolis, Ill.)

The converted uranium is then ship-ped to an enrichment facility--which is where URENCO, a multinational enrichment company, comes in. 

URENCO’s new enrichment plant in southern New Mexico, which began operations in June 2010, is the first such facility to be licensed in the US in 30 years.

URENCO Communications Manager Don Johnson says the delay in certifying new enrichment plants was likely due to the partial meltdown of a nuclear power plant at Three Mile Island in Pennsylvania in 1979.

“After Three Mile Island, I think there was a sense of concern that slowed things down,” Johnson tells SFR. “A combination of things, including the cost of capital and some other issues, combined to present an environment that maybe wasn’t as conducive to nuclear power as we feel like we have gotten to in the last few years.”

Despite such risks, southeastern New Mexico is the poster child for the nuclear industry’s new acceptance--a fact URENCO learned when, in 2002, it was searching for a place to build an enrichment facility in the US.

“URENCO was trying to locate first in Louisiana, and then in Tennessee, [and] they were meeting resistance in Tennessee,” New Mexico state Sen. Carroll Leavell, R-Eddy, says. So Leavell contacted the company and suggested southeastern New Mexico--specifically, Eunice, a tiny town just 5 1/2 miles from the Texas border.

Compared to the push back the company experienced elsewhere, southern New Mexico was a breeze.

“It was amazing, the lack of resistance in New Mexico,” Leavell says. “I’ll never forget: Whenever we had the groundbreaking, URENCO had anticipated an organized protest at the scene,” he says. “They had considerable security. I was with the [president of the company] the night before, and he was very concerned about security, and I said, ‘I don’t think what you’re expecting is going to

When they arrived the next day at the site--“nothing but mesquite and sand” back then, Leavell says--they found some 200 people. Every single one of them was there to support the project.

“If there was any protesters that day,” Leavell says, “they certainly did not make themselves known.”

Johnson says URENCO makes a concerted effort to be a “good corporate citizen” by sending its employees out to volunteer in surrounding areas and by making “significant donations” in local communities.

For other companies, however, the reverse is true.

International Isotopes is pioneering a method of marketing enriched uranium byproducts.
Credits: Courtesy of International Isotopes.

International Isotopes, a company currently building a plant near Hobbs to provide the fourth phase of the uranium fuel cycle, received incentives from southeast New Mexico governments to locate there.

“There [were] quite a few incentives put together in a financial package--tax incentives and the opportunity to participate in the local economic development act, where the state can transfer properties,” International Isotopes (INIS) CEO Steve Laflin tells SFR.

“The last thing in the world I wanted to do was build a project where we were not going to be strongly welcomed,” Laflin says.

The INIS plant, located just 20 miles from URENCO’s enrichment facility, uses the by-products of enrichment to create gases that can be used in solar cells, lubricants and pharmaceutical products.

“We are the solution,” Laflin tells SFR. “We are taking material that otherwise would be a waste and dealing with that--and we’re doing it in a way that’s safe and highly sensitive to the environment.”

Laflin says INIS submitted an application to process uranium to the NRC in 2009 and anticipates approval later this year. By 2012, Laflin says, INIS should be in the construction phase of a $125 million processing plant. 

Any risks, Laflin says, lie mostly in the chemical processes INIS uses, not in the uranium.

“This is much more of a chemical manufacturing facility than anything else,” Laflin says. “There’s no question fluoride products are toxic and reactive, but there’s very well-established safety processes.”


The only phase of the uranium fuel cycle that’s missing in New Mexico is nuclear power generation--but The Babcock & Wilcox Co., another multinational corporation that builds small, modular nuclear reactors, is scoping out possibilities. (B&W is also one of the contractors in charge of running LANL.)

B&W Public Relations Manager Jud Simmons writes, in an email to SFR, that although the company has not received any offers of incentives from New Mexico public officials, it “continues to seek opportunities in the state and in other parts of the world where the reactor would be a good fit.”

Small modular reactors, Fine says, are cheaper--they cost about $500 million, rather than the $10 billion required for a conventional reactor--safer and use less water than the large, water-cooled reactors used in places like Japan.

“We had a recent phenomenally cold three-day period in New Mexico, [and] we lost gas service,” Fine says. “The whole system that failed was based on natural gas, pipelines, so forth. But the reliance on an additional, low-risk source of energy would’ve been a small nuclear modular reactor, contained underground, and it would be impervious to a temperature like that.”

The final stage of the nuclear fuel cycle is the one that perhaps generates the most resistance: storing radioactive waste.

In New Mexico, the Waste Isolation Pilot Plant, a DOE project to store radioactive waste underground in natural geologic salt dome formations near Carlsbad, went online in 1999--but only after several years of permitting negotiations and public hearings.

Because of federal budget cuts, however, WIPP is currently shedding some of the vaunted jobs it has provided to the Carlsbad area. The City of Carlsbad, which normally receives WIPP-related infrastructure funding from DOE, voted in May to return $3.5 million with the hope of preventing further job cuts at the facility.

Donavan Mager, the manager of strategic communications for Washington TRU Solutions, which contracts with the DOE to manage operations at WIPP, says the plant is seeking to preserve jobs by expanding its mandate to accept other types of hazardous waste material. Achieving the DOE’s goal of processing 90 percent of all US transuranic waste by 2015, Mager says, will mean a need for fewer employees.

Despite a solid safety record, though, WIPP still generates questions and concerns even from observers living hundreds of miles away. 

“Just because you buried it in a hole in the ground doesn’t mean it’s gone away,” Nuclear Watch of New Mexico Operations Director Scott Kovac tells SFR. “It still exists. It can’t hurt anybody for 100 years or 1,000 years--but eventually it’s going to get out.”

Not far from WIPP, a privately owned Texas waste facility has engendered sharp criticism from nearby residents. Waste Control Services’ storage site accepts low-level radioactive waste--but its location close to the New Mexico border and overlying the vital Ogallala Aquifer has environmental groups incensed. (Lately, a war of information has broken out between a public relations firm hired by WCS and Public Citizen, a nonprofit consumer advocacy organization; read their opposing briefs at


But activists aren’t the only ones with doubts about nuclear energy. Particularly in the face of catastrophes, such as the recent earthquake, tsunami and nuclear reactor crisis in Japan, Fine says the general public can quickly grow wary of nuclear energy.

To Fine, though, such fears are based on emotion, not reason.

“The public understandably fears radioactivity--not nuclear energy,” Fine says, “not the science and technology of manufacturing energy that’s atomic-based. The fear is the radioactivity.”

Jonathan Block, a staff attorney at the New Mexico Environmental Law Center who once worked for the Union of Concerned Scientists and has spent decades litigating nuclear issues, counters that most stages of the uranium fuel cycle are plagued with complicationsnot least because the NRC is reputedly cozy with industry representatives.

In January 2010, for instance, an


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