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enCore to acquire Energy Fuels’ Alta Mesa ISR uranium project

Published by , Editorial Assistant
Global Mining Review,


Energy Fuels Inc., a leading US producer of uranium and rare earth elements (REE), has announced that it has entered into a definitive agreement to sell three wholly-owned subsidiaries that together hold Energy Fuels' Alta Mesa ISR project to enCore Energy for total consideration of US$120 million.

Highlights:

Alta Mesa includes a fully-licensed and constructed ISR processing facility that has an operating capacity of 1.5 million lbs./yr of uranium. Between Alta Mesa, Rosita and Kingsville Dome, all fully licensed for production, enCore’s existing processing capacity will reach 3.6 million lbs./yr of uranium.

  • Alta Mesa is host to measured and indicated resources of 3.41 million lb U3O8 (1.57 million t at an average grade of 0.109% U3O8) plus inferred resources of 16.79 million lb U3O8 (7.0 million t at an average grade of 0.120% U3O8). Abundant exploration upside exists within the Alta Mesa land package around the existing defined resource areas, which enCore will prioritise.
  • Alta Mesa will diversify enCore’s South Texas operations into a 3rd fully licensed production facility, along with Rosita and Kingsville Dome, all located in the business-friendly state of Texas. enCore’s mid- and long-term production potential is further fuelled by a pipeline of projects with Dewey-Burdock in South Dakota, Gas Hills in Wyoming and additional projects in New Mexico. There are only 11 licensed production facilities in the US.
  • Alta Mesa is currently on standby and ready to resume production, as market conditions warrant. It can reach commercial production levels with limited required capital within 10 months of a production decision.
  • Control of a large private land package totalling 195 501 contiguous acres, including 4575- acres currently under a lease and mining permit and 190 926-acres under a lease-option and exploration/testing permit.
  • The acquisition will further cement enCore Energy’s position as a dominant ISR uranium developer and future producer in the US.
  • Alta Mesa’s operations are located on private land, with 100% of minerals privately owned, and in a supportive jurisdiction with primary regulatory authority residing with the State of Texas.
  • The Alta Mesa ISR processing facility is a fully permitted and constructed past-producing in-situ recovery operation, with a well-established track record of lower cost uranium production. It currently has fully permitted resources that, with the installation of production patterns, can be put into production with no additional permitting required.
  • Alta Mesa has extensive exploration results, with under-explored potential, across the area that have identified significant uranium resources that enCore expects can be recovered at lower costs, as market conditions warrant.
  • Alta Mesa produced a total of 4.6 million lb of uranium between October 2005 and November 2013, including 1 million lb/yr of uranium over a two-year period.
  • With low holding costs, Alta Mesa provides fully permitted lower-cost production scalability that can be brought into production quickly to provide a domestic energy source for the US.

William M. Sheriff, Executive Chairman of enCore, commented:

“This transaction exceeds enCore’s long stated requirement for any major acquisition to be accretive to shareholders in not only production capacity but also cost and timelines to production and an asset we secure at a compelling valuation. In addition, this acquisition further cements enCore’s commitment to near-term US-based uranium production with our initial focus on South Texas. Alta Mesa will immediately become a flagship asset amongst our large project portfolio, including our licensed and past-producing Rosita ISR production plant in South Texas, our development-stage Dewey-Burdock and Gas Hills projects in South Dakota and Wyoming, respectively, along with a large resource portfolio in New Mexico. enCore is committed to developing a reliable domestic source of energy.”

Paul Goranson, CEO and Director of enCore, further added:

“As the previous Vice President of Mesteña Uranium, LLC, which owned and operated the Alta Mesa project, we generated substantial cash flow during the last cycle of elevated uranium prices, and established the project as a leading US ISR uranium producer. Combined with our South Texas operations that are anchored around our Rosita project, this acquisition puts us in an exceptionally strong position to advance towards being a long-term sustainable source of uranium production to fuel clean nuclear energy that will benefit our local communities, the state of Texas, and the US.”

Read the article online at: https://www.globalminingreview.com/mining/16112022/encore-to-acquire-energy-fuels-alta-mesa-isr-uranium-project/

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