Energy Fuels Unveils Compelling Economics for Major Rare Earths Expansion

Energy Fuels CA2926717083

A newly released feasibility study has provided a robust financial blueprint for Energy Fuels Inc.'s planned second-phase expansion of its rare earth processing facility in Utah. The findings position the company to potentially become a leading low-cost producer of these critical materials in North America, marking a significant step in U.S. efforts to secure a domestic supply chain.

The strategic driver behind this multi-billion dollar project is clear: reducing reliance on Chinese supply. Rare earth elements are vital components in permanent magnets used for electric vehicles, wind turbines, and defense technologies. Energy Fuels aims to supply a substantial portion of U.S. demand, with the expanded facility projected to meet approximately 45% of the nation's total requirements for these critical materials by 2030.

Robust Financial Projections Detailed

The bankable feasibility study outlines a favorable economic case, with capital costs coming in lower than prior estimates. The Phase 2 expansion is now projected to require a capital investment of $410 million.

Key financial metrics from the study reveal a highly profitable venture:
* After-tax Net Present Value (NPV): $1.9 billion (using an 8% discount rate)
* After-tax Internal Rate of Return (IRR): 33%
* Average annual EBITDA for Phase 2 alone: $311 million over the first 15 years
* Combined projected EBITDA (including the Vara-Mada project): $765 million

A critical competitive advantage highlighted is the projected all-in production cost of $29.39 per kilogram of neodymium-praseodymium (NdPr) oxide equivalent. This cost structure is expected to place Energy Fuels among the most cost-efficient global producers.

A Step Change in Production Capacity

The expansion represents a dramatic increase in output. The company's existing White Mesa Mill (Phase 1) currently processes around 1,000 metric tons of NdPr oxide annually. The Phase 2 build-out is designed to boost that capacity to more than 6,000 metric tons per year.

Furthermore, the project includes plans for the production of heavy rare earths, which are particularly crucial for high-performance applications. The facility is expected to yield approximately 66 metric tons of terbium and 240 metric tons of dysprosium each year.