Gov. Dave Freudenthal and Wyoming's congressional delegation have identified a major threat to the state's uranium industry that they're doing their best to counter.

In separate letters to Energy Secretary Steven Chu, the officials have decried his department's plans to transfer between $150 million and $200 million worth of excess government uranium to the United States Enrichment Corp. in fiscal year 2010.

The governor noted that an additional $450 million of excess government uranium will also be transferred over the next three years. "There is no question that the noncompetitive introduction of such a large quantity of uranium will adversely impact the uranium-producing industry in my state," Freudenthal wrote.

Indeed, it would likely sink the price of uranium and end plans to launch several new uranium mining operations in Wyoming and across the West. Uranium companies in recent years have bought up thousands of mineral lease acres in the West and invested hundreds of millions of dollars to launch more than 30 new uranium mining projects. About two-thirds of the projects are in Wyoming.

The federal government controls a stockpile of about 153 million pounds of uranium derived from the decommissioning of the nation's nuclear weapons program. Last December, the Department of Energy approved the Excess Uranium Inventory Management Plan, which sets out a schedule to gradually introduce prescribed volumes from the uranium stockpile into the nuclear energy market while softening the impact on pricing. The uranium industry was one of the key stakeholders in the development of the plan, so it would not destabilize the industry.

But the industry was blindsided by the department's decision in July when it announced it would release an additional $150 million to $200 million worth of uranium in order to fund the cleanup of pollution at a Cold War-era plant in Piketon, Ohio.

While likely unintentional, the result could be a huge blow to the uranium industry in Wyoming.

"The department's plan to fund additional temporary jobs at the Portsmouth plant in Piketon is laudable," Freudenthal noted. "However, the department must consider the long-term implications of this decision outside of Ohio. The loss of mining and mining-related jobs in Wyoming and elsewhere will be a direct outcome of the department's present course."

The governor suggested the Ohio remediation could be paid for through existing department stimulus funds, in combination with sales consistent with its own management plan, instead of the additional uranium sales.

Freudenthal correctly concluded that "to sacrifice long-term jobs in Wyoming -- and likely the long-term viability of uranium markets -- for short-term results in the Midwest seems shortsighted."

The uranium industry's planned expansions and future operations in Wyoming should provide long-term, high-paying jobs to Wyoming miners for years to come. But those projects could be postponed or lost forever unless the Department of Energy reconsiders this ill-timed sale of excess government uranium, before it's too late.