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Management Controls over the Department of Energy's Uranium Leasing Program, OAS-M-08-05

The Department of Energy's Uranium Leasing Program was established by the Atomic Energy Act of 1954 to develop a supply of domestic uranium to meet the nation's defense needs. Pursuant to the Act, the Program leases tracts of land to private sector entities for the purpose of mining uranium ore. According to Department officials, one purpose of the Program is to obtain a fair monetary return to the Government. The Program is administered by the Department's Office of Legacy Management through a contractor. The uranium leases issued by the Department include two types of royalty payments: an annual royalty and a production royalty. The annual royalty is a flat rate and is paid to the Department whether production has occurred or not. The production royalty is based on a calculation of the value of the uranium ore that was produced by the mine.