Tom Zoellner

by Uranium - Rock That Shaped the World

  Talk of the nuclear renaissance made uranium speculation the hot thing in Vancouver in the fall of 2007, with a market capitalization estimated at $250 million for the juniors alone. The number of exploratory projects was said to be ten times those active during the dog days of the eighties.

  Not all of these companies are disingenuous. Quite a few are willing to do the drilling—to use what Jim Cambon calls the rotary truth machine—and operate in the good-faith hope that a multinational will consider their findings worthy of a joint venture or an acquisition. The only way to do that is to walk the path of all the fakers and make the dirt look as good as possible. Juniors previously occupied with diamonds or copper or molybdenum started adding uranium to their suite of minerals just to be safe. A number of them changed their company names to incorporate the word uranium.

  “In a few short months,” exulted an investment guide, “uranium has become one of the most sought-after commodities since the Romans minted gold coins.” This reborn market in radioactivity floats on a raft of hope.

  That hope has now extended even into Yemen, home of the would-be nuclear reactor on the shores of the Red Sea. A small Canadian company announced the staking of a possible deposit some miles to the southwest of Sana’a. The evidence was visible on the old maps of an airborne radiometric survey done in 1992 by a British company. Gamma rays were detected. It might have been a surface layer of potassium or a similar metal that throws off a radioactive signature, but it could well have been uranium.

  I called on the company’s office in Yemen, a gray gingerbread-style house behind a high gate of sheet metal. The geologist was an older man with blue ink stains on his shirt. He invited me in for tea and showed me the place on the map where, he assured me, the exploration would be continuing.

  “We would like to see if there’s something in the ground,” he told me. “Inshallah, we will begin work in the next two or three weeks. We are just waiting on some instruments.”

  There was a hole in the ground, a perfect circle, a dark eye bleeding small pools of green liquid from the edges. A drill had just been pulled from it.

  It was sunset on the edge of the Gobi Desert in southern Mongolia, and I stood near the hole with D. Enkhbayasgalan, a twenty-five-year-old geologist (almost all Mongolians have only a single name but use the initial of their father’s name on formal occasions). He pointed east across the gravel hardpan toward a straight line of similar drill holes marching off into the distance, each about the length of a dollar bill in diameter and each one intersecting uranium that began about forty yards down. The past week’s work had revealed that the ore body was about two miles long and was shaped like a salamander.

  “If we get lucky,” said Enkhbayasgalan, “we’ll even be able to see the crystals under a microscope.” He wore a baby blue sweatshirt with the words COLORADO USA.

  The drill hole was part of a series—a “profile”—called East Haraat, which referred to a distinctive rock outcropping that had functioned as a lookout for Genghis Khan’s horsemen in the thirteenth century. From the top of it, there was a commanding view of the dry plains to the south, the grass and sky two halves of a sphere that seemed to encompass all. There was now a uranium camp at the base of the hill, run by a company from Canada named Denison Mines, with a water tower, a generator, three wooden cabins in the dacha style, a metal-sided horse corral, and a line of eerie futurist streetlights that glowed chlorine green at night. The camp had been built in the midst of this spectacular isolation by construction crews from the Soviet Union in the 1970s, when Mongolia was a loyal client state and a reliable source of uranium. They had not managed to develop a mine in this part of the Gobi, but they drilled thousands of holes, and their old radiometric logs inscribed with Cyrillic lettering became valuable after the price of uranium started to climb and Western companies looked to Mongolia as the next hot frontier, with a pliant government and the peal of wealth lying under the grass.

  Among the usual legalized frauds from Canada were several well-capitalized outfits that had every intention of resurrecting the Russian uranium archipelago and railing the ore to China. But the government became hesitant. In 2006, the Mongolian parliament rescinded a generous royalty schedule that had been passed in the days after the collapse of Communism, when hard currency was scarcer than it is today.

  Mongolia is still trying to decide just how much of its uranium it wants to give away and at what cost. The lessons of the “resource curse” are remembered here, and the government does not want to turn itself into another Niger—a slave to its own geology.

  Mongolia has a heritage of plunder and abuse, dealt from its own hands at the height of its thirteenth-century military glory but received from its neighbors ever since. The nation is a landlocked plateau wedged between two great powers, Russia and China, which have treated it as a stepchild and a cash cow ever since the collapse of the Mongol empire. China finally left in 1911, when the Qing dynasty fell apart, and the Soviet Union moved in ten years later, setting up a puppet government and launching violent purges of the Buddhist monasteries, which they viewed as rivals for power. They built instant towns with big drafty buildings and ghastly apartment rectangles at calculated spots in the grasslands and forced a nomadic people to take up a more European-style life of wages and timetables. The capital city was located at a lonesome river crossing called Ulaanbaatar—the name means “Red Hero,” for a local party hack—and decked with town houses, wide triumphant avenues, vodka bars, a ceremonial Parliament, a tourist hotel with bugged rooms. Ulaanbaatar was known as the world’s coldest capital, a hardship posting for diplomats, where winter winds howled all night long through barren concrete plazas. On the city fringes were haphazard arrangements of gers—the traditional circular tents of birch poles and thick wool that can be erected and reerected in a matter of hours and that have been a housing staple here for thousands of years.

  The Soviets could not eliminate the pastoral life, and its economy of cashmere and sheep’s milk, but they could wipe away traces of regional pride as embodied by the figure of Genghis Khan, who was never mentioned in schoolbooks or honored with a statue, though he had represented the pinnacle of Mongol glory, organizing rival tribes into deadly phalanxes that marched out of the grasslands in 1211 and started taking Chinese cities. With fast horses and a deft series of alliances, they moved into the breadbaskets of Persia and extended their reach to the Caspian Sea, becoming a world military superpower. Some of the empire’s people are believed to have walked much earlier across the ice-choked Bering Strait to live in Alaska, where yet another offshoot13 settled the gorgeous (and uranium-rich) lands of the American Southwest and became known as the Navajo.

  Khan died in 1227 and was buried in an unmarked grave in the hills northeast of the present-day site of Ulaanbaatar; his pallbearers were all slaughtered so they could never reveal the spot. Khan’s sons and grand-sons extended their patriarch’s domination, reaching the foothills outside Vienna and sacking the scholarly center of Baghdad, spelling the beginning of the end of Islamic cultural dominance. Hundreds of thousands of people were efficiently put to the sword. The irreplaceable contents of the caliph’s libraries were tossed in the Tigris River, said by chroniclers—with a touch more color than accuracy—to have run black with ink after it stopped running red with blood. Hearing of these disasters, the monk Matthew Paris was moved to call the Mongols a “detestable nation of Satan” and harbingers of the coming apocalypse. But they could not maintain their rule by force. Infighting and poor administration caused the empire to fall apart at the beginning of the fifteenth century. At its apex, it had covered more than four times the lands conquered by Alexander the Great.

  A well-worn joke today is to refer to a strongly conservative person as being “to the right of Genghis Khan,” but the joke gets it wrong: Khan was, if anything, a liberal by modern definitions; he instituted a government system of record keeping, put the Mongolian language into writing, outlawed the kidnapping of women, assured dipl
omatic immunity to his neighbors, established an independent judiciary, and levied stiff taxes on the lands he conquered. As the historian Timothy May has noted, he also instituted a welfare system for widows. Khan was also known for his sexual appetite: DNA tests reveal that about one-sixteenth of the population of eastern Asia is genetically descended from a single person, believed to be him.

  The people of Mongolia held on to their love of open vistas and rambling even while under the Soviet occupation. About 40 percent of the population lives untethered to any city, raising horses, camels, sheep, and dogs in a cycle of grazing encampments that revolve with the seasons. When approaching a ger, a visitor is supposed to yell “Noho hori,” which means “Hold the dog!” This is a version of hello. It is not uncommon to see motorcycles parked outside a ger in the middle of nowhere, though a visitor is always welcomed with tea and curdled sheep’s cheese. Hospitality is a social necessity in a country where the temperatures routinely fall below minus 20 degrees Fahrenheit in the winters.

  The big rolling prairies are reminiscent of eastern Wyoming in their scope and blankness and annihilating reach. This is a land that does not easily show its scars, and the few cities the Russians managed to leave have a tumbledown aspect. Scavengers have been at work on the ruins of the old military installations, and even the concrete walls are coming down, fading into the grass like the remains of a Roman garrison. Nothing seems permanent.

  I went out again to the edge of the Gobi with a lanky operations manager who peppered his speech with bloody and fuck and rattled his Land Cruiser at high speed down a washboarded path that paralleled the Trans-Mongolian Railway. The asphalt had given way to dirt as the grasses had thinned away, and the horizon flattened into a long dun-colored plain the deeper we went into the desert. We pulled over for a lunch of sandwiches and coffee, shielded from the cold breeze by a mound of weedy earth, and watched a man clad in a blue robe walk past us silently and toward the next rise, some five miles off. We were still watching him half an hour later, a tiny blue dot bobbing on the far horizon, next to the bumpy dirt track.

  “This is the main road to Sainshand?” I asked, naming a town I had seen on the map.

  “Hell,” he told me. “This is the main road to China.”

  The primitive condition of this highway to Beijing had suited the Russians, who were wary of creating an easy invasion corridor for their Chinese rivals to the south. The area closest to the border had been seeded with land mines, which the camels kept setting off. The railroad tracks in China are still different widths from those on the Trans-Mongolian, and freight cars must be lifted onto dollies for transfer at the border. This is the awkward point of juncture for two civilizations that have been in contact for more than three thousand years.

  Another legacy of the Russian occupation can be found a few hundred miles northeast from the presumed spot of Genghis Khan’s unmarked grave, in a series of low waves of land called the Saddle Hills. There was once a secret uranium city here, a place named Mardai that appeared on no maps but was home to thirteen thousand workers and a branch of the GUM state department store. The local herdsmen were warned that the region was cursed, full of poisoned lakes and sheep with only three legs.

  Almost nothing but concrete slabs and broken glass is left today. The city has been vandalized to the point of nonexistence, the shell of its downtown sledgehammered to chips for the sake of the rebar at the core. The scrap metal is valuable, and deconstruction can be as profitable as construction. But in its heyday in the 1980s, Mardai was the pride of the Soviet military, classified even within parts of the Kremlin and exempt from the usual idiocies of five-year plans. Its managers were told to drill as deep into the Paleozoic as they needed. Their only mandate was to develop a strategic reserve of uranium for national emergencies. After President Ronald Reagan started making bellicose speeches in 1982, the mines went underground. The Soviet engineers sank a total of eight shafts, intersecting dark veins of pitchblende every place they drilled.

  “Thank God they threw that extra money at it!” said Gerald Harper, the vice president of exploration at Vancouver-based Western Prospector Group. “There are sixteen kilometers of ventilation pipes down there that still work. It was well-done work with high-quality materials.”

  Western Prospector now owns a good portion of the once-secret city and plans to start selling off the Red Army’s old uranium for reactor fuel. The company has built a mining camp big enough for two hundred workers and hopes to be busy exploiting the Russian-built shafts by 2010. The camp will be dismantled when the uranium is gone, as efficiently as Mardai disappeared into the grass. “We do not want the hassle of running a town site, no schools or hospitals,” Harper told me. “The last thing we want is to be (a) a social service agency and (b) to have that liability when the mine closes down.” The workers will likely be bussed in, he said.

  Western Prospector had acquired its part of the secret city from an old friend of Bob Adams’s, a bald-headed veteran of the Texas uranium fields named Wallace Mays, who had spotted a gleaming opportunity in Mongolia shortly after the Russians departed. He made a deal to acquire a one-third interest in the site, and went on to claim more than half, though he would eventually lose most of it, reportedly due to financial troubles. During his many trips to Ulaanbaatar, Mays—in his seventies—met and married a local woman named Hulan nearly half a century younger than he. Mays told me over drinks at a Toronto hotel that the culture of horsemanship and the free range shared by both Texas and Mongolia were critical to their bond.

  The plan to exploit Mardai was thrown into doubt in August 2007 after the government suddenly revoked the exploration licenses. The decision was reversed after a flurry of protest from Vancouver, but the flap exposed one of the strong-arm tactics that the government might reserve for itself if it feels the uranium frenzy becomes too destructive. The Mongolian Parliament granted itself the right to acquire up to 50 percent of a mine deemed to be of “strategic” value. Its logic was that local shell companies had done the hard work of exploration during Soviet times, and the nation was thereby due a fair share. But the problem is that nobody in Ulaanbaatar has yet formulated a definition of “strategic.” Some of the more hard-core Socialist elements of the government have called for nationalizing the mines.

  For better or worse, the initial tone in Mongolia has been set by Robert Friedland, a man described with awe in Vancouver as “the greatest stock promoter of all time.” He is also known by environmentalists, less respectfully, as “Toxic Bob,” because of an incident at Summitville, Colorado, in which the state and federal governments were stuck with a $200 million cleanup caused partly by a cyanide leak from the premises of a gold company of which he was CEO (he has denied the allegation). Friedland is a long-faced graduate of Oregon’s Reed College, a onetime student activist who studied Buddhism and eventually found a career in the Vancouver financial markets. He is now the executive chairman of Ivanhoe Mines, a company that claimed an area the size of Connecticut in the Gobi Desert, encompassing what it says is the largest copper and gold deposit in the world, at a place called Oyu Tolgoi, close to the Chinese border. It is expected to reap $2 billion a year, more than twice the current gross national product of Mongolia.

  Friedland has promised to employ thousands of locals and contribute liberally to social causes within Mongolia, but protesters have burned him in effigy outside Parliament, and he remains a controversial figure. Friedland only fueled the controversy with a 2005 speech to a group of investors at the Royal West Hotel in Tampa, Florida (a performance now known as the T-Shirt Speech), in which he called Mongolia “the hottest exploration venue on planet Earth,” which he hoped to build into a “mining country like Chile.” There was plenty of land around for waste dumps, and Mongolia was close enough to the Chinese border to feed copper to the Chinese. The most notorious part of the speech, however, came as he was describing the block-caving method by which the minerals would be cheaply liberated from the host rock. “You’re in the
T-shirt business,” he said, “you’re making T-shirts for five bucks and selling them for one hundred dollars. That is a robust margin.” The line was heard as an allusion to sweatshops, and it did not go over well in Ulaanbaatar, where politicians were quickly furnished with copies of his words. But Mongolia’s weak economy subsists on mining—minerals of various sorts represent 70 percent of all exports, ahead of cashmere wool—and the government was looking for ways to appease populist sentiments while preserving a reputation as an investment-friendly place.

  I went to see D. Javkhlanbold, the head of the geological department at the agency that had pulled the licenses at Mardai. He was a man in his twenties with a hard handshake and a colorful necktie with a map of the world as its pattern. I asked him about the current discussion over which uranium field would eventually be considered “strategic,” and therefore open to heavy state participation. He told me that much of the original exploration had been done by Mongolian companies acting under Soviet duress. The minerals therefore belonged to them, too. Those fields judged the richest would be most likely to be partially subsumed, he said.

  There was a hope that Mongolia could one day build its own atomic power plants, he said. They would be fueled by local uranium. The nuclear renaissance should also benefit those places that provide its seed material, much as the Belgian Congo had been rewarded with a nuclear reactor for its role in helping to exploit the uranium treasure at Shinkolobwe. But this hope, admitted Javkhlanbold, was far off. There were still a lot of questions that didn’t have any answers.

  “Many here are saying that all uranium should be regarded as ‘strategic, ’ because it is so harmful to the environment,” he told me. “Right now, there’s not a lot of understanding of uranium.”