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Energy Fuels (UUUU) – Uranium production timeline accelerates with uranium price spike

Energy
0 min read


Friday, December 22, 2023

Energy Fuels is a leading U.S.-based uranium mining company, supplying U3O8 to major nuclear utilities. Energy Fuels also produces vanadium from certain of its projects, as market conditions warrant, and is ramping up commercial-scale production of REE carbonate. Its corporate offices are in Lakewood, Colorado, near Denver, and all its assets and employees are in the United States. Energy Fuels holds three of America’s key uranium production centers: the White Mesa Mill in Utah, the Nichols Ranch in-situ recovery (“ISR”) Project in Wyoming, and the Alta Mesa ISR Project in Texas. The White Mesa Mill is the only conventional uranium mill operating in the U.S. today, has a licensed capacity of over 8 million pounds of U3O8 per year, has the ability to produce vanadium when market conditions warrant, as well as REE carbonate from various uranium-bearing ores. The Nichols Ranch ISR Project is on standby and has a licensed capacity of 2 million pounds of U3O8 per year. The Alta Mesa ISR Project is also on standby and has a licensed capacity of 1.5 million pounds of U3O8 per year. In addition to the above production facilities, Energy Fuels also has one of the largest NI 43-101 compliant uranium resource portfolios in the U.S. and several uranium and uranium/vanadium mining projects on standby and in various stages of permitting and development. The primary trading market for Energy Fuels’ common shares is the NYSE American under the trading symbol “UUUU,” and the Company’s common shares are also listed on the Toronto Stock Exchange under the trading symbol “EFR.” Energy Fuels’ website is www.energyfuels.com.

Michael Heim, Senior Vice President, Equity Research Analyst, Energy & Transportation, Noble Capital Markets, Inc.

Refer to the full report for the price target, fundamental analysis, and rating.

Energy Fuels announces that is has commenced production at three mines. During the third-quarter earnings’ discussion six weeks ago, management indicated that it was hiring personnel and upgrading facilities at four mines with plans to restart production at one or two of the mines in 2024. Today’s announcement would appear to be an acceleration of previous plans. Management also indicated previously that it plans to produce 1,000,000 lbs of uranium in 2024 and stockpile the uranium until a mill campaign is completed in late 2024 or early 2025. It is unclear whether these plans have changed in light of today’s announcement.

Uranium prices are surging. Uranium prices were below $40/lb. most of the last ten years causing domestic producers to idle production. Prices started to rise in 2022 reaching a price in the mid seventies just six weeks ago. Since then, uranium prices have soared to a level near $90/lb. It has been our investment premise that cheap uranium from Kazakhstan sold on spot would eventually dry up, and that when that happened, uranium prices would rise quickly. With utilities (and the government) now rushing to shore up supply, the log jam appears to have been broken.

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