LAKEWOOD,
CO, May 27, 2016 /PRNewswire/
- Energy Fuels Inc. (NYSE MKT:UUUU; TSX:EFR) ("Energy
Fuels" or the "Company"), a leading producer of uranium in
the United States, is pleased to
announce that it has completed the previously announced acquisition
of Sumitomo Corporation's ("Sumitomo's") 40% interest in the Roca
Honda Project. The Company now owns and controls 100% of the
Roca Honda Project, which is one of the largest and highest-grade
uranium projects in the United
States.
As a result of the acquisition, Energy Fuels has
significantly increased the size of its industry-leading U.S.-based
uranium resource portfolio by 6.8% (Measured & Indicated) and
12.4% (Inferred). Energy Fuels now owns 100% of the uranium
resources at the Roca Honda Project, which, according to a
February 27, 2015 Technical Report
and Preliminary Economic Analysis (the "PEA"), prepared in
accordance with National Instrument 43-101, Standards of Disclosure
for Mineral Projects ("NI 43-101") (see disclosure below
relating to reliance on a PEA), holds a total of 1.5 million
tons of Measured and Indicated Mineral Resources with an average
grade of 0.48% U3O8 containing 14.6 million
pounds of uranium, together with 1.2 million tons of Inferred
Mineral Resources with an average grade of 0.47%
U3O8, containing 11.2 million pounds of
uranium. The project is currently at an advanced stage of
permitting and boasts attractive operating costs, total expected
production of approximately 25 million pounds of uranium, and a
nine year mine life.
The PEA assumes that Roca
Honda mined material will be processed at the Company's
100%-owned White Mesa Mill, which is within economic trucking
distance. Furthermore, the cash costs described in the PEA
for the Roca Honda Project cover 100% of the costs of the White
Mesa Mill, even though the Roca Honda Project will only utilize a
portion of the mill's capacity.
As previously announced, the Company also holds
properties adjacent to the Roca Honda Project that contain
significant additional historical resources. According to a
2007 report, these adjacent properties contain an additional 0.7
million tons at a grade of 0.34% eU3O8,
containing 4.8 million pounds of uranium. These properties
also contain existing mine infrastructure and excellent exploration
prospects, which have the potential to enlarge the scope of the
project and further improve upon the economics currently described
in the PEA (see disclosure below relating to reliance on
historical resource estimates).
As consideration for the 40% interest, Energy
Fuels (i) issued to Sumitomo 1,212,173 common shares at closing,
valued at US$2.8 million based on the
volume-weighted average price of the shares on the NYSE MKT over
the 10 trading days ending on May 26,
2016; and (ii) has agreed to pay US$4.5 million in cash upon the first commercial
production of uranium from the Roca Honda Project.
Stephen P. Antony,
President and CEO of Energy Fuels stated: "Energy Fuels is
pleased to complete this important acquisition at what we believe
is a reasonable price, as it provides the Company with a number of
benefits, including complete control over the timing, budget, and
scope of the project and complete internalization of the benefits
of the project when it goes into production by processing
Roca Honda material at our White
Mesa Mill, which is the only licensed conventional uranium mill
currently operating in the U.S. The Roca Honda Project is an
important component in our strategy of combining large-scale
optionality and leverage to improving uranium markets, with lower
cost production from our Nichols Ranch Project, alternate feed
materials, certain of our Arizona Strip conventional properties,
and our pending acquisition of Mesteña Uranium, LLC. We thank
Sumitomo for being a valued joint venture partner over the past
several years and wish them the best of luck in their new focus on
producing mine assets."
About Energy Fuels: Energy
Fuels is a leading integrated US-based uranium mining company,
supplying U3O8 to major nuclear
utilities. Energy Fuels operates two of America's key uranium
production centers, the White Mesa Mill in Utah and the Nichols Ranch Processing Facility
in Wyoming. The White Mesa Mill is the only conventional
uranium mill operating in the U.S. today and has a licensed
capacity of over 8 million pounds of U3O8 per
year. The Nichols Ranch Processing Facility is an in situ
recovery ("ISR") production center with a licensed capacity of 2
million pounds of U3O8 per year. Energy
Fuels also has the largest NI 43-101 compliant uranium resource
portfolio in the U.S. among producers, and uranium mining projects
located in a number of Western U.S. states, including one producing
ISR project, mines on standby, and mineral properties in various
stages of permitting and development. The Company's common
shares are listed on the NYSE MKT under the trading symbol "UUUU",
and on the Toronto Stock Exchange under the trading symbol
"EFR".
Stephen P. Antony, P.E., President &
CEO of Energy Fuels, is a Qualified Person as defined by
Canadian National Instrument 43-101 and has reviewed and approved
the technical disclosure contained in this news release.
Readers should be cautioned that the PEA is preliminary in
nature, that it includes inferred mineral resources that are
considered too speculative geologically to have the economic
considerations applied to them that would enable them to be
categorized as mineral reserves, and there is no certainty that the
PEA will be realized. Readers should also be cautioned
that a qualified person has not done sufficient work to classify
the historical estimate as a current estimate of mineral resources
or mineral reserves in accordance with NI 43-101. This
historical resource estimate from 2007, prepared by Uranium
Resources Inc., was classified as a "Probable Reserve."
However, this category was applied without using applicable mining
standards and economics, and should not be considered reserves by
industry definition. The Company believes this historical
estimate is relevant and reliable, as the methodology was well
documented and utilized industry standard practice. However,
the methodologies used do not reflect current best industry
practices. The Company does not consider these historical
estimates to be equivalent to current mineral resources or mineral
reserves as defined in NI 43-101, nor has the Company completed
sufficient work to confirm an NI 43-101 compliant resource.
Therefore, the historical estimates cannot, and should not,
be relied upon as NI 43-101 resources or reserves.
Cautionary Note Regarding Forward-Looking
Statements: Certain information contained in this
news release, including: any information relating to the Company
being a leading producer of uranium;the Company's
expectations as to longer term fundamentals in the market and price
projections; scalability, and the Company's ability to be able to
restart or increase production as market conditions warrant; the
ability of the Company to realize the expected benefits of the
acquisition; the expected costs or production of the Company's
projects; estimates relating to current mineral resources;
expectations regarding the ability to use existing mine
infrastructure and exploration potential; the ability to
enlarge the scope of the project and improve upon the economics of
the project; the ability to bring the project into commercial
production; and any other statements regarding Energy Fuels' future
expectations, beliefs, goals or prospects; constitute
forward-looking information within the meaning of applicable
securities legislation (collectively, "forward-looking
statements"). All statements in this news release that are
not statements of historical fact (including statements containing
the words "expects", "does not expect", "plans", "anticipates",
"does not anticipate", "believes", "intends", "estimates",
"projects", "potential", "scheduled", "forecast", "budget" and
similar expressions) should be considered forward-looking
statements. All such forward-looking statements are subject
to important risk factors and uncertainties, many of which are
beyond Energy Fuels' ability to control or predict. A number
of important factors could cause actual results or events to differ
materially from those indicated or implied by such forward-looking
statements, including without limitation factors relating to:
the Company's expectations as to longer term fundamentals in the
market and price projections; scalability, and the Company's
ability to be able to restart or increase production as market
conditions warrant; the ability of the Company to realize the
expected benefits of the acquisition; the expected costs or
production of the Company's projects; estimates relating to current
mineral resources; expectations regarding the ability to use
existing mine infrastructure and exploration potential; the
ability to enlarge the scope of the project and improve upon the
economics of the project; the ability to bring the project into
commercial production; and other risk factors as described in
Energy Fuels' most recent annual report on Form 10-K and quarterly
financial reports. Energy Fuels assumes no obligation
to update the information in this communication, except as
otherwise required by law. Additional information identifying
risks and uncertainties is contained in Energy Fuels' filings with
the various securities commissions which are available online
at www.sec.gov and www.sedar.com. Forward-looking
statements are provided for the purpose of providing information
about the current expectations, beliefs and plans of the management
of Energy Fuels relating to the future. Readers are cautioned
that such statements may not be appropriate for other
purposes. Readers are also cautioned not to place undue
reliance on these forward-looking statements, that speak only as of
the date hereof.
Cautionary Note to United States Investors
Concerning Estimates of Measured, Indicated and Inferred
Resources: This news release contains certain disclosure
that has been prepared in accordance with the requirements of
Canadian securities laws, which differ from the requirements of
U.S. securities laws. Unless otherwise indicated, all reserve
and resource estimates included in this news release have been
prepared in accordance with Canadian National Instrument 43-101 –
Standards of Disclosure for Mineral Projects ("NI 43-101") and the
Canadian Institute of Mining, Metallurgy and Petroleum ("CIM")
classification system. Canadian standards, including NI
43-101, differ significantly from the requirements of U.S.
securities laws, and reserve and resource information contained in
this news release may not be comparable to similar information
disclosed by companies reporting only under U.S. standards.
In particular, the term "resource" does not equate to the term
"reserve" under SEC Industry Guide 7. United States investors are cautioned not to
assume that all or any of Measured or Indicated Mineral Resources
will ever be converted into mineral reserves. Investors are
cautioned not to assume that all or any part of an "Inferred
Mineral resource" exists or is economically or legally
minable. Energy Fuels does not hold any Reserves as that term
is defined by SEC Industry Guide 7. Please refer to the
section entitled "Cautionary Note to United States Investors
Concerning Disclosure of Mineral Resources" in the Company's most
recent annual report on Form 10-K for further details.
SOURCE Energy Fuels Inc.