#United States #Denver #Rare Earth #Energy Fuels #NdPr

Energy Fuels' Rare Earth Processing Expansion

Energy Fuels Inc., a prominent U.S. producer of uranium and rare earth elements (REEs), is on the brink of a substantial expansion of its rare earth processing capabilities, as outlined in their newly released Bankable Feasibility Study (BFS). This marks a pivotal moment for the company as it positions itself to meet a significant portion of the U.S. demand for rare earth materials, particularly those critical for high-tech industries.

The BFS indicates an estimated capital expenditure (CAPEX) of $410 million for the Phase 2 Circuit at the White Mesa Mill in Utah, which represents a decrease from prior estimates. What stands out is the anticipated all-in production cost of $29.39 per kilogram of NdPr equivalent, which places Energy Fuels among the lowest cost producers globally.

Economic Highlights of the Expansion

The highlights and projections from the BFS are striking:

• - Following the commissioning of the expansion, production capability will soar to over 6,000 tonnes per annum (tpa) of NdPr, in addition to 240 tpa of dysprosium and 66 tpa of terbium, significantly enhancing the Mill's capacity.
• - The BFS estimates a net present value (NPV) of $1.9 billion at an 8% discount rate for the new circuit, translating to $7.96 per share, with an impressive internal rate of return (IRR) of 33%, after taxes. Remarkably, when combined with the recently announced Vara Mada Project, the projected NPV jumps to $3.7 billion, or $15.26 per share.
• - Energy Fuels anticipates generating approximately $311 million in average annual EBITDA over the first 15 years from Phase 2 alone, a figure that rises to $765 million when incorporating expected revenue from their Vara Mada Project over the same timeframe.

Restoring the U.S. Rare Earth Supply Chain

Mark S. Chalmers, CEO of Energy Fuels, emphasized the strategic importance of this expansion, stating, "Energy Fuels is on the cusp of solving America's rare earth processing 'bottleneck'." The company is poised to satisfy 45% of the total U.S. rare earth needs in the immediate future, and according to Benchmark Mineral Intelligence, meet 100% of the U.S. demand for essential heavy REEs such as terbium and dysprosium by 2030.

Energy Fuels is not only focusing on quantity but is also committed to maintaining high operational standards while minimizing costs. The BFS suggests that operating costs for the new circuit will be competitive, potentially ranking in the first quartile among global producers, competing even with Chinese operations.

Future Outlook

With regulatory approvals anticipated by mid-2027, construction of the new processing circuit could begin by early 2029. This timeline aligns well with the expected delivery of monazite from the Donald Joint Venture project in Australia and the Vara Mada project in Madagascar. The ability to source high-quality rare earth materials is crucial for achieving the project's goals and consequently restoring the U.S. rare earth supply chain.

In summary, the BFS represents a significant step forward not just for Energy Fuels but for the U.S. rare earth industry as a whole. By efficiently expanding its processing capabilities while maintaining a focus on cost-effectiveness and sustainability, Energy Fuels is setting the stage for a robust domestic supply of critical materials that power modern technology.

In an era where the global demand for rare earths is surging, Energy Fuels stands out as a leader committed to both operational excellence and environmental responsibility. This expansion could very well redefine the landscape of rare earth production in America, ensuring that the country remains competitive on the global stage.