LAKEWOOD, Colo., July 17, 2020 /CNW/ - Energy Fuels
Inc. (NYSE American: UUUU) (TSX: EFR) ("Energy Fuels" or the
"Company"), the largest uranium mining company in the United States, is pleased to announce the
recent elimination of a portion of the Company's debt, confirmation
of 2020 uranium production guidance, and updates on the value of
the Company's significant uranium and vanadium inventories.
On July 14, 2020, the Company
completed the partial cash redemption of its floating rate
convertible unsecured subordinated debentures (the "Debentures") as
previously announced on June 11,
2020. On July 14, the Company
distributed Cdn$10,430,000 of cash to
holders of the Debentures (as of July 8,
2020). This amount represents the redemption of one-half of
the total Debentures outstanding, and as a result, only
Cdn$10,430,000 aggregate principal
amount of the Debentures remain outstanding, which are due on
December 31, 2020.
In addition, the Company is continuing to build its significant
uranium inventories. As of December 31,
2019, the Company held 515,000 pounds of finished uranium
concentrates, which are currently being held in inventory at the
Company's White Mesa Mill and at North American uranium conversion
facilities. The Company reaffirms that it expects to produce
between 125,000 and 175,000 pounds of uranium in 2020, mainly from
pond returns and alternate feed material recycling at its White
Mesa Mill. As a result of existing inventories and planned 2020
production, the Company expects to have between approximately
640,000 and 690,000 pounds of finished uranium in inventory at the
end of 2020.
According to industry consultant TradeTech, the July 10, 2020 weekly spot price for uranium was
US$32.90 per pound, an increase of
over 30% since the end of February
2020. If the spot price for uranium remains at current
levels, and assuming no change to production or sales guidance,
Energy Fuels expects to hold between US$21,000,000 and US$23,000,000 of uranium inventory at the end of
2020. In addition, the Company currently holds approximately
1,600,000 pounds of vanadium in inventory, which at today's
mid-point spot price for V2O5 (US$5.30 per pound, according to Metal Bulletin)
has a value of approximately US$8.5
million.
"The strength of Energy Fuels' balance sheet is unsurpassed in
the global mid and junior uranium mining sectors today, including
decreasing debt loads and increasing values on our product
inventories," stated Mark S.
Chalmers, President and CEO of Energy Fuels. "Indeed, no
other comparable uranium miner to my knowledge has Energy Fuels'
inventory levels, and many are incurring significant debt to
advance their development and exploration projects. As I have
previously asserted, debt can be extremely burdensome for mid and
junior uranium producers, developers and explorers and potentially
very destructive to shareholder value if markets do not improve as
expected. This is why Energy Fuels has focused on a strategy of
debt reduction over the past several years, and we are proud to say
that we expect to be debt-free by the end of 2020.
"Energy Fuels is also continuing to strengthen our balance sheet
by managing our significant and growing inventories. Assuming no
change to our current production or sales guidance, Energy Fuels
expects to have about 640,000 to 690,000 pounds of uranium in
inventory at the end of 2020. At today's spot price for uranium,
Energy Fuels expects to hold up to US$23,000,000 of uranium inventory value – or
possibly significantly more if uranium prices continue to rise due
to the major mine production cuts we're now seeing around the world
or other U.S. government- or market-driven factors. Furthermore, we
have 1,600,000 pounds of high-purity finished vanadium product in
inventory, which is worth about US$8.5
million at today's spot price. I can think of no other
comparable uranium miner anywhere in the world that has the
potential to have over US$30 million
of inventory value at the end of 2020, and possibly much more if
uranium and/or vanadium prices improve.
"Finally, I'll say a few words about rare earth elements. We're
very excited about the technical and commercial progress Energy
Fuels has made on rare earths. There is a lot of interest in rare
earths currently, and we believe Energy Fuels is more advanced than
any other company in the U.S. on producing a salable rare earth
concentrate. We believe our modest, but highly scalable, short-term
rare earth strategy will occur sooner, and cost a lot less, than
other initiatives garnering considerable attention right now. We
hope to have more announcements on our rare earth progress in the
coming weeks and months."
About Energy Fuels: Energy Fuels is the leading
U.S.-based uranium mining company, supplying
U3O8 to major nuclear utilities. The Company
also produces vanadium from certain of its projects, as market
conditions warrant. Its corporate offices are near Denver, Colorado, and all of 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, and has the ability to produce
vanadium when market conditions warrant. 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 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.
Cautionary Note Regarding Forward-Looking
Statements: This news release contains certain
"Forward-Looking Information" and "Forward-Looking Statements"
within the meaning of applicable United
States and Canadian securities legislation, which may
include, but are not limited to, statements with respect to:
the Company's expectation to become debt-free by the end of
2020; the Company's production expectations; expectations regarding
inventory balances and the value thereof at the end of 2020;
expectations as to market improvements; and expectations on the
progress of the Company's rare earth element initiative, whether
the Company will be successful in producing a salable rare earth
concentrate and the cost of producing any such concentrate.
Generally, these forward-looking statements can be identified by
the use of forward-looking terminology such as "plans," "expects,"
"does not expect," "is expected," "is likely," "budgets,"
"scheduled," "estimates," "forecasts," "intends," "anticipates,"
"does not anticipate," or "believes," or variations of such words
and phrases, or state that certain actions, events or results
"may," "could," "would," "might" or "will be taken," "occur," "be
achieved" or "have the potential to." All statements herein, other
than statements of historical fact, are considered to be
forward-looking statements. Forward-looking statements involve
known and unknown risks, uncertainties and other factors which may
cause the actual results, performance of or achievements of the
Company to be materially different from any future results,
performance, or achievements, express or implied, by the
forward-looking statements. Factors that could cause actual results
to differ materially from those anticipated in these
forward-looking statements include risks associated with:
the Company's expectation to become debt-free by the end of
2020; the Company's production expectations; expectations regarding
inventory balances and the value thereof at the end of 2020;
expectations as to market improvements; expectations on the
progress of the Company's rare earth element initiative, whether
the Company will be successful in producing a salable rare earth
concentrate and the cost of producing any such concentrate;
and the other factors described under the caption "Risk Factors"
in the Company's most recently filed Annual Report on Form 10-K,
which is available for review on EDGAR at
www.sec.gov/edgar.shtml, on SEDAR at
www.sedar.com, and on the Company's website at
www.energyfuels.com. Forward-looking statements contained
herein are made as of the date of this news release, and the
Company disclaims, other than as required by law, any obligation to
update any forward-looking statements whether as a result of new
information, results, future events, circumstances, or as a result
of changes in management's estimates or opinions, or otherwise.
There can be no assurance that forward-looking statements will
prove to be accurate, as actual results and future events could
differ materially from those anticipated in such statements.
Accordingly, the reader is cautioned not to place undue reliance on
forward-looking statements. The Company assumes no obligation to
update the information in this communication, except as otherwise
required by law.
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SOURCE Energy Fuels Inc.