Energy Fuels (AMEX:UUUU) - Base Resources Merger Bolsters Rare Earths Strategy

[Music] my name is Mark chelmer and I'm president and CEO of Energy Fuels Energy Fuels is a a critical Mineral Company that is uh centered around uranium but is rapidly building a um a rare earth production capabilities at the white Mesa Mill in Utah and securing properties around the globe to feed that meal so it's a really exciting company story there is no un likee Energy Fuels normally you would invest in a uranium company or a rare earth company but with Energy Fuels you get an investment in both Mark I am so pleased to have you on here I think we've got ourselves a little bit of a scoop you've just announced um the base resources deal um I think it's super super exciting uh you've done what you said you were going to do I mean tell us tell us about the deal well it's a merger with with with basee resources and base resources has a quite a long history of being a successful heavy mineral sand producer and Kenya the qualia project it's coming to an end but they also have been uh working to develop the toar project in Madagascar which is a very large known high-grade um very profitable project when it finally gets uh all its approvals and uh it has a lot of monoy M a lot of mono site so we see it as fitting in right into our wheelhouse with the acquisition of Bia and uh soon to be hopefully uh the Donald project in uh Victoria Australia to add uh toara and the base team to our um company is is is really exciting so I think that it it's it's showing how we're building scale and scale of world significance I've been saying that for long long time we want to be World significant and this is another step so uh you know watch this space and and we're also getting a full team of people that actually are operating in heavy mineral Sands business and are have been profitable for the last number of years tell tell us um a little bit about what we've intervie based resources since 2019 um we we understand but perhaps some of the listeners uh and viewers will be interested in saying well what what's the size of the opportunity here what do we know well I mean it bases um own dfs's and pfs's indicate that it could have EBA of between about 350 to 400 million us per year it's a long-term project like 40 to 50 years of resource um the modde contained modde is literally 2% modde in the HM and uh they're planning on uh recovery when the project goes into into production around 22,000 tons of monazite per year and they have a resource of 1.4 million tons of monazite in inferred resource of another almost 800,000 tons of monite so this is a big project and it's very simple uh technically it has been mirrored in uh some delays with the Madagascar government but uh they are just passing or passed the new mining code and stability agreement so we're we're we're quite confident that they're going to get approvals this year to go forward and if it's not this year next year so we see it as a absolutely uh worldclass asset to put into our Corral as we build out a world significant uh Rare Earth um production capabilities with a real quality asset that fits perfectly into our wheelhouse right okay so the Minal signs there's what said what what's the you talk about monite there obviously in terms of um byproducts and and and uh contributors was the bottom line what what else we looking at in there ciron rutal and ilite so um you know so that those are th again this is a very profitable mind on those uh elements alone uh it doesn't need monite or Rare Earth prices to be profitable so that's one of the exciting things about this is that this is a project that stands on on its own without the monite and matter of fact for years they nobody even wanted to talk about the monite but when you add the combination of the the the heavy mineral Sands and the monite is really a standout uh or we believe will be a sound out in due course when it's developed and operating right okay now see the North American Factor comes into play here you know we've seen soort Chinese going and wrapping up these large scale projects you know globally but the the North American you know critical minerals Hub you know which you have at White Mesa um and I guess the the boning need um of the North American Market do you do you does this help not just your plant but does this help you with conversations internally getting those sort of um that kind of government backing does it help with opening up new markets in the North American market for you look I think I think that the the combination of assets that we're acquiring fits right in the Wheelhouse of the United States government uh from a bipartisan perspective because we're covering places like Brazil Australia and Africa so I I think this is just going to be the beginning of a lot of wins for Energy Fuels you know there's been people who have been out there doubting that you know why would we uh diversify into things like Rare Earth when the uranium business is good and it is good and we're we're capitalizing on the uranium business right now but this is a really really nice bolt-on uh as I said of world significance with really excellent cost structures in due course right well and also I'm just I'm just thinking about some of the factors that this brings brings into play such as mitigate or diversifying your your your risk profile mitigating some of those factors now rare Earths were you know up last year before it kind of came off a bit you know uranium's been through its its rise it's on the up at the moment I what does this do for the kind of Rue potential for your company for white for white Mesa and in terms of your board's view about how you how you continue to diverse by risk yeah well I mean I I I think as I said the bases um DFS and PFS for the heavy mineral sand and monite uh they indicated that the average eata over you know several decades was going to be around that uh 350 to 400 US per year at iada and and and and that is just basically selling those products it's not getting the value add so we think that we can get further value ad by processing the modelite into separated products uh Heavies and lights and uh so it again it fits in it it fits into an area where we can get additional value out of uh the acquisition with base in to are and their expertise uh while we still have uh revenue from uranium and the price uranium's up so you know it it you know everything we do Matt and you know I've said this before has radioactivity involved with it now the heavy Minal Sands aren't radioactive but the mazzite certainly is but and we can recover the uranium from that monite I mean just the the the uranium recovery from the monite is somewhere in the order of around 75,000 75,000 pounds of uranium per year at around $8 or $9 a pound so it's not a lot of uranium but it's lowcost uranium and so that's another just another uh uh you know cherry on the on the cake here for us and how we can monetize uh the uranium when others are just going to throw it away right okay and let's let's stick with the B the base resources still if we may so you you were said to me in the past you know you want to build up this Rare Earth component this additional arm of of of Revenue and opportunity um and you you compare yourself to m MP and and Linus or wanting to compare yourself to MP and Linus obiously you know um they are multi-billion dollar companies where does this deal put you in relation to them maybe in terms of production profile or or potential EIT I think catching up really quickly okay we still have to get these projects uh up and running uh we still need to do the we've got the phase one uh separation plan uh being commissioned right now and we still need to build out the phase two phase three uh at the Mill for the larger uh re Earth circuit but what it what it shows is that we are building the molecules and building the skill set and we have the skill set to do the separations with this phase one and uh that puts us in an ideal position to move on to phase two um you know as we build this feed up so our goal is look everyone has their own business plan you know lus has been successful and what they do MP is uh also a significant mine in the United States focus on basite um lius is focus on Hard Rock monite and we're focused on monite sands from heavy mineral sence operations so we all have our own business plan so and we all need each other to be successful to provide enough elements for this energy transition and electrification so I would just say that we're doing in driving our bus and securing this additional feed or project in in the context of the other projects we have I hope it sends a clear message to people we are in this seriously as a very nice complement to our uranium business uh and our ability to handle um uh the uranium and the radio activity associated in these kind of Feats right okay so this isn't a case of um um promoting and riding the the momentum wave this is building a real business generating real revenues that's the goal absolutely and that isn't always the goal of everybody so you we're focused on a profitable high margin um earnings company uh of significant scale and um and and and and that's what we're executing so I mean if you look at the Timeline when we got into the rare earth four years ago and the rare earth prices were high and you look at the advances we made with making a carbonate partially separated product acquiring beia um getting an mou with Astron on um the Donald project starting commissioning of phase one and now this announcement I think we're making pretty solid progress here we're not just sitting on our on our on our our bums yeah it's it's um it's probably interesting times in dat and is this um potential first of additional um deals similar deals whe whether they be mergers Acquisitions or um or agreements for feed I mean how do you view the future is this enough to keep you going for a while this is enough to keep us going for a while but you know we're looking at uh full integration we have an initiative to move beyond the separation of the lights and the Heavies into the metals and Alloys so we're working on that and the step after that is is is magnets so so we're looking for full integration um you know we're funding a lot of this on the back of the uranium um uh uh business that we have that is is is ramping up rapidly so um it's just a very interesting time Matt and uh but we're focused on long-term value for shareholders not just a run up in the share price just for the sake of a pushing the share price up so you know we're Builders and doers we're not promoters okay and let's let's go to uranium because people there's a lot of cry um cries from people out there going I wish they'd stick to um the uranium um and forget about the rare us and and I think perhaps this answers that that that question for sure I hope hope it doesn't or we can certainly talk about it into the future but back to uranium um uranium's been on aun it's kind of reset back down at lower levels taking kind of Shine off the momentum play but still in terms of real businesses you've got to feed that Mill so you're Mining and are you doing the um the buying schedules that you talked about or are you talking yeah we're talking to people about you know buying schedules and and we're probably going to custom make them for each operator because there probably not going to be very many people that would actually take us up on that or even have a mine ready to sell us or so um no we we're planning to um uh try to sign up a couple parties to to provide feed to the mill under a buy schedule and and you know and Matt you know and I think I've told you we're never getting out of uranium business I mean I've been doing this for 48 years and when I go underground I want to grab a jack leg and start mining uranium so you know it's just about adding the maximum long-term value for our shareholders that is why we're doing what we're doing but I'll never get out of the uranium business and anyone who thinks I'm getting out of the Uranian business uh don't lose any sleep over that you can talk to my wife and she'll say you'll never get out of Iranian business she's tried uh right okay but I want to be clear so the these are inbound conversations you're not going chasing anyone is that what you're saying well we we we publicly said we were looking at a buying schedule and there's been some inbounds and um and maybe even a few outbounds but we're building the source of feed to the mill I mean we've got uh Pandora and Lal operating we've got um we've got uh the pinion plane mine minione right now operating and we're bringing feed in that is a hungry Mill and if we can buy product to to to process or or to process through that meal and it makes sense to us uh we'll we'll certainly consider buying it okay Mark appreciate you making the time um to talk to us hold off the press um come back and tell us more when you're allowed to okay we'll do exciting times Matt thank you very much

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Id: cNEWa3cy0jU

Length: 15min 4sec (904 seconds)

Published: Mon Apr 22 2024