Q1 2025 Energy Fuels Inc Earnings Call
Okay.
Constantine: Good morning, My name is Constantine and I will be your conference operator today.
Constantine: At this time I would like to welcome everyone to the energy fuels first quarter 'twenty 'twenty five a conference call.
Constantine: All lines have been placed on mute to prevent any background noise. After.
Constantine: After the Speakers' remarks, there will be a question and answer session, where you will be able to ask one question and one follow up question should you desire.
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Speaker Change: Oh, Thank you Constantine and thank you for that introduction again, Mark Chalmers I'm, the CEO of energy fuels are.
Speaker Change: We are really appreciative of people joining the <unk> Q1, 'twenty twenty-five conference call today and it is always a pleasure to update everyone on our remarkable progress on building the largest critical minerals company in the United States.
Speaker Change: We are also very very pleased to increase to announce that we've increased our 2025 production in finished goods inventory guidance by 22% and 193% respectively.
Speaker Change: And that is quite unusual because many companies are actually going the other direction at this point in time. So we're really excited about operating in the guidance are.
Speaker Change: We also are happy to report that we have very strong working capital position of $214 million.
Speaker Change: We continue to advance our high grade and low cost U S uranium production, including a record production in April that was after the quarter of 151000 pounds at an average grade.
Speaker Change: 164% and I want to point out something that its 1.64%.
Speaker Change: And a reserve zone in the main zone.
Speaker Change: Five eight so the grades that we're currently mining or almost three times, what we had expected in that area. So very excited about that and we continue to advance our world class rare Earth, and heavy mineral sand projects and capabilities and no debt. So.
Speaker Change: There is a lot going on now Kim are.
Speaker Change: Are they advancing their slides, where you're doing it I'm doing it okay, well I'll keep you cute on advancing your slides there will be a conference replay are available. After the conference call has concluded on the website and as always as constituting mention there'll be time for questions at the end of today I'm being joined.
Speaker Change: For questions like Nick Bennett, our C F O and and we will just tag team that is required so let's get going and this first slide I always say I love This slide by lovely slide.
Speaker Change: And again this is taken not far from whether the White Mesa Mill is in Utah next.
Speaker Change: Next slide.
Speaker Change: I may be making some forward looking statements are those are covered on page two.
Speaker Change: Next slide.
Speaker Change: Again, many of you seen this before but I think one of the things that people don't understand that energy fuels is really got three different core businesses. We have this long history in the uranium business as people know and that is going remarkably well we've added on the rare earth elements.
And the heavy mineral sands, so you really get into investments in three companies in energy fuels and investment in energy fuels and I also want to mention that we have the current capability or will have the capability to commercially recover at least 10 of the critical elements on the list of 50 <unk>.
Speaker Change: The White Mesa mill and that is a key differentiator.
Speaker Change: Next slide.
Speaker Change: So in all of our products are in demand for energy defense mobility or health.
Speaker Change: Uranium as I said long history of doing that now were in large scale production. The rare Earth. We are also leading producer of N. D. P. R oxide and we currently have a lot of that product out for validation and we also have the technology to produce heavy rare earth oxides, which in itself is very.
Speaker Change: Very unique heavy mineral sands again, advancing a world scale World class.
Speaker Change: Rare Earth titanium zirconium mineral sands projects globally couldn't be more excited about that and vanadium. We do have the vanadium circuit and we do have an alien minds were not currently recovering.
Speaker Change: Even though we are producing it at Lasalle complex as we speak and lastly, the medical isotopes. We're still forging ahead on the R&D work, we have for recovery of radio.
Speaker Change: Next slide.
Speaker Change: Well again, if you ask the question the World is your oyster well energy fuels can obviously say that we are asset rich when you look at the assets we have in the United States certainly most of them are uranium the white Mesa mill are kind of in that it's kind of a purposely red <unk>.
Speaker Change: <unk>, where we can do all of this processing of these critical elements and then when you look down in the southern hemisphere with the heavy mineral sands projects the Bahia project.
Speaker Change: The Donald joint venture of our office in Perth, and the World Class World scale totally are a project we have a absolutely fantastic pipeline to feed the white Mesa mill in due course with a number of these critical elements going forward.
Speaker Change: Next slide.
Speaker Change: So you know this graphic and we do this graphic to kind of show where the processing of these critical elements actually happened. So certainly the uranium is mined in the region and processed through the White Mesa mill and it comes out the backend as you 308 or vanadium.
Speaker Change: Or at the same time or when we flip the mill over we can process of rare Earth and the rare earth, mainly the monazite in the Zena time can also be process and the rare Earth processing facility, which is the white Mesa mill and outcomes of the rare earth on the backend the heavy mineral sands.
Speaker Change: Don't have to go through the mill, but they're also critical elements.
Speaker Change: But they also you know are recognized as such and that's how we get a list of 10 plus the rare Earth. There are other elements that can be extracted if there's an economic reason to do so now our phase two plant that we're currently doing engineering work and feasibility work on well actually separate.
Speaker Change: Great that rare Earth processing step and the white Mesa mill into two separate processing facilities.
Speaker Change: Next slide.
Speaker Change: Again, we continue to grow our portfolio of uranium sales contracts, we have four contracts with three nuclear utilities deliveries between 2025, and 2030 and 2025, we only have about 220000 pounds of deliveries.
Speaker Change: And we have yet to fill those deliveries were also have entered into an agreement to purchase third party uranium ore from.
Speaker Change: From a company that is not too far from the mills. So our contracts are really light in 2025.
Speaker Change: And they they they ramp up to around eight or 900000 pounds in 2026, but they are all concluded in 2000.
Speaker Change: 2030 on that currently our current skirt contracts that we have.
Next slide.
Speaker Change: So let's talk about more about the uranium highlights and I want to emphasize that some people get confused with what we mined what we processed the the alternate feeds and how that all fits together so towards the end of the product.
Speaker Change: This presentation I have a table that I think simplifies that significantly. So when you look at the conventional mines are in Q1, we mined 115000 pounds of unprocessed uranium so its uranium ore and that was from opinion plane and Lasalle and the Pandora mines.
Speaker Change: And that's now being stockpiled at the mill now when you talk about how much we plan to mine in.
Speaker Change: In 2025, we've upgraded this guidance.
Speaker Change: Looking at mining between 875000 pounds to one 4 million pounds of uranium and we can process that as weak select to do at the mill in due course, we are still working forward to increase our production up to about the 2 million pounds per year subject to mark.
Speaker Change: Conditions, and but we're certainly making significant steps that direction as we speak now when you look at what's process.
Speaker Change: At the White Mesa Mail for Q1, we process.
Speaker Change: 50000 pounds of finished goods, we're now saying that this year our guidance for finished goods process at the mill is 700000 to 1 million pounds and we are be at the same time, we have the optionality to build up inventory and I'll go into more detail at the end.
Speaker Change: To sell uranium when the markets support that we have taken a position to not sell uranium.
Speaker Change: At $63 64, $65 per pound and that's a good thing because we actually bought uranium at that price range and we now have a uranium price it's about $70 a pound. So just in the last month or two the price uranium or at least on the spot price has gone up by 10%.
Speaker Change: Next slide.
Speaker Change: So again, the white Mesa mill and the remarkable facility that it is with both the capability to produce uranium in rare Earth and never has it been more important to have a white Mesa mill Etsy, only operating conventional mill in the United States.
Speaker Change: It is the largest uranium processing facility in the United States. It's fully licensed permitted producing and has employees. There that has a license capacity of 8 million pounds per year. It has the ability to to process and recycle uranium Barry alternate feeds at behr.
Speaker Change: Low cost 40 years of operational experience and we also have the opportunity to assist the U S government and the Navajo nation on cleanup of abandoned uranium mines on the reservation.
Speaker Change: Had no connection to our company and we're really looking forward to helping the Navajo nation on that front hopefully this year and it is the only facility that can process monocytes for production of rare Earth oxides in the United States.
Speaker Change: Next slide.
Speaker Change: So again, you've seen this slide but it's been a modified a little bit but the current orders coming out of the opinion planed mine and highest grade uranium mine in the history of the United States and that ore is now being shipped across the Navajo nation with our agreement.
Speaker Change: The Lasalle complex is really a complex of several mines. It's about 11 miles of trend or is also being transported to the mill from the Lasalle complex and we're also looking at refurbishing a couple of other minds on Lasalle complex. So the combination of those two projects we plan to me.
Speaker Change: And between about 80 or 55000 tons to 80000 tons in 2025, we're still doing drilling at Naples Ranch, our ISR operation in Wyoming, and we will restart that when the market supports.
Speaker Change: Next slide.
Speaker Change: This is exciting a slide here.
Speaker Change: Because opinion plane is starting to hit on all cylinders and we're currently mining the main ore bodies zone and I already mentioned that in April we had record production of 151000 pounds at 1.64% and and I mentioned that.
Speaker Change: The average grade in that zone was about 0.5859, and we're mining at about one six so we are getting extraordinary grades there and we think that will equate to a larger resource or reserve mines because of these extraordinary grades that we're hitting it.
Speaker Change: In addition, many of you would seem that we announce exploration results on the juniper ore zone.
Speaker Change: And and the Juniper or zone is.
Speaker Change: It's just below that mean zone, but it's only 200 feet, it's 200 feet away.
Speaker Change: And so it's very close but look at those grades 13 feet of 7% seven and a half feet at seven 5% 9.3 feet of 2%.
Speaker Change: 17, and a half feet up 5.7, including four feet up 20%.
Speaker Change: These are grades that are on hurt us.
Speaker Change: In the United States, and I couldn't be happier to be reporting the success that we're having and there will be additional drilling happening in the juniper zone there.
Speaker Change: There's still a lot of runway to continue to add but we're gonna have to drill because you can fit a lot of uranium and a very small area with those types of grades.
Speaker Change: Next slide.
Speaker Change: So this is gonna be a bit of an experiment, but we wanted to take you down into the opinion plain ore body.
Speaker Change: And we're gonna try to show you a video so let's take a look at the video now.
Speaker Change: Yeah.
Speaker Change: Good afternoon.
Speaker Change: Premium asarco.
Speaker Change: And then we'll bring them the one five with people on Skippy.
Speaker Change: [noise] getting down to the one five level four or 500 feet below surface.
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Speaker Change: But here we are at 50.
Speaker Change: 250, and find better I'm, sorry, the second the last sub level.
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Speaker Change: Thanks, Joe.
Speaker Change: Yes.
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Speaker Change: Therefore, all voted here to make sure we break into a nice clean slim.
Speaker Change: So after that order out.
Speaker Change: And they'll be able to work off this nicely.
Speaker Change: The Big thing here with your commentary on the top left and sweeping all the way across the space.
Speaker Change: Now the name of the fill in the bottom right.
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Speaker Change: Free cash.
Speaker Change: But now for the two separate teams.
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Speaker Change: But we are sitting right on the size of the Bradshaw.
Speaker Change: Thanks for the Samsung I mean outside.
Speaker Change: Satisfied.
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Speaker Change: With good high grade.
Speaker Change: So I'll get out of their way so they can choose this round and then be ready for tomorrow.
Speaker Change: All about three or four or round.
Speaker Change: And get them toy maker.
Speaker Change: Yeah.
Speaker Change: Yeah.
Speaker Change: Alright, well that went without a hitch but.
Speaker Change: Again, you know.
Speaker Change: Just to give people a inside of it of the mine and again.
Speaker Change: I highlight that the grades have been averaging mined in that 1% to 2% range and again.
Speaker Change: When you put that in perspective, I mean, that's like like two to four ounces per ton.
Speaker Change: Gold. So this is really high grade high value product that we're getting out of opinion, playing fine. So let's talk a little bit more about some of the development pipeline again, you've seen this slide where we have the sheet Mountain project in Wyoming, which is fully permitted.
Speaker Change: And we also have the Henry Mountain <unk>.
Speaker Change: In Utah, Bullfrog, which is in pre permitting but also I'm very pleased to announce that our large Roca Honda project in New Mexico, which is also underground and high grade, but it's about a half a percent. So it's still a high grade mine by uranium standards, but a very significant project, but it was all.
Speaker Change: Selected by the Trump administration on this fast 41 covered project. So it's being recognized as a national security critical mineral project and we're really excited to get that that designation on one of our projects in our pipeline projects. So we've been advancing the feasibility.
Speaker Change: Study on that four or actually it's C. E O S on that and we think now is an ideal time to get that wrapped up in advance. So we have another significant permitted project.
Speaker Change: Next slide.
Speaker Change: Ooh, we'll shift gears a bit.
Speaker Change: Go around the world here talk a little bit about the rare Earths production and.
And assets that we have in heavy Merrell says next slide.
Speaker Change: Well, we haven't left the country, yet, but you just some pictures of the solvent extraction circuit for extraction of the rare Earth oxides at the White Mesa Mill and again. This is a facility that does the team at White Mesa built on their own without consultants without people advising them.
Speaker Change: They came up with the designs for this and they built a very significant solvent extraction facility and commissioned it for under $20 million and I know there's companies out there that have pilot plants that are $100 million and do just a fraction of what this will do.
Speaker Change: I mean, some of these pilot plants that are pushing $100 million, we'll do like one ton of N. D. P. R per month and this project when it has enough feet will be doing like 70, or 80 tonnes a month and we built it for $20 million and also look at the bags of N D. P. R oxide Oh.
Speaker Change: Bulky bags, it's not in a beaker and we're doing it at commercial scale.
Speaker Change: Slide.
Speaker Change: Again, we continue to focus on integration.
Speaker Change: As we step down to the supply chain there with the mining beneficiate shouldn't cracked leach separation and we are still very keen to advance into the metal, making an alloy steps and I've always mentioned <unk> working for us.
Speaker Change: From General Motors, she came to work for us and she is helping us with that backend and she's been a great. Great addition to our team.
Speaker Change: To help us on that back in and again, we will collect the monocytes on these multiple projects, including material from tomorrow. So we have diversified supply in feed to the white Mesa mill globally at scale is equivalent to Linus in due course.
Speaker Change: Excellent.
Speaker Change: So also recent news certainly in March we signed a collaboration agreement with Posco International in South Korea Korea are on a collaboration on.
Speaker Change: Providing them with feet materials, but we also signed a strategic alliance with <unk> in March also collaborating on bolstering our U S. Critical minerals supply chains and then in April we made the announcement that we have the technical capability and skills to produce six of the seven <unk>.
Speaker Change: Heavy rare earth subject to current China export controls.
Excellent.
Speaker Change: Okay, we'll talk a bit about financials next slide.
Speaker Change: So again at the end of the quarter March 31, we continue and are producing low cost uranium we're developing this tier one critical mineral.
Speaker Change: And heavy mineral sand assets, and we're maintaining our strong balance sheet excellent liquidity with over $210 million of liquidity at the end of the quarter made up of cash marketable securities interest bearing securities very liquid.
Speaker Change: $20 million of our trade and other receivables and about $435 million of inventory.
Speaker Change: At current prices you can actually increase the value of those inventories by about $12 million at the end of the quarter. We had nearly 600000 pounds of finished uranium we continue to add to that we still have vanadium inventory, we still have some or inventory and we have zero debt.
Speaker Change: The net loss for Q1 of 'twenty five.
Speaker Change: It was driven on a very aggressive program is advancing all of these projects and also electing not to sell uranium at current prices as I mentioned in the first quarter that uranium prices are languishing spot between 63 and 65 now there are about $70 and so by holding onto that uranium.
Speaker Change: That value of that product that spot is 10% higher and we really still don't have a lot of interest in selling your aim at $70 a pound the last uranium we sold on the spot was 80 Bucks a pound and that is kind of our goal to get back with an eight handle on it going forward, we did sell the residual.
Speaker Change: Heavy mineral sand products from koala.
Speaker Change: Ilmenite rutile and zircon for about 15, and a half million dollars and we did have a net loss of $26 three about <unk> 13 per share because other than the sales of the largely of the heavy mineral sand products, we didn't try to generate any additional revenue.
Speaker Change: Next slide.
Speaker Change: So again talk in a bit more about the quarter, we're actively mining uranium as I talk we're actively processing uranium ores.
Speaker Change: We're opportunistically buying uranium on the on the spot market. We bought some for $64 75 about 50000 pounds will continue to look at when that makes sense or not.
Speaker Change: We did enter into that purchase agreement for third party or with another party and not too far from the mill, we're still increasing our ramp up to that 2 million pounds of uranium production with existing assets and we're also advancing these other large scale uranium projects, which can incur.
Speaker Change: <unk>, our production up to about that four to 6 million pounds with additional permits and investment and we're continuing to do the R&D recovery our radiant.
Speaker Change: Next slide.
Speaker Change: So again I think people have struggled to kind of understand.
Speaker Change: How the mining and the processing and the alternate feeds all fit together. So if you look at that top line with his mind and you look at what was our guidance previous guidance and our revised guidance, it's up from the midpoint of 22% and again most peoples are going down.
Speaker Change: So if you look at that that's mine product and then if you go to the next line alternate feet and for example in our guidance it hasn't changed for the alternate feet by 160000 to 200000 pounds that is about 20% of our feed for the White Mesa mill and that is a.
Speaker Change: Sweetener and our production profile. So then go down to the third line with the process pounds were say 700000 2 million pounds up 278% and one of the reasons. This up so big as we are actually looking at not processing some of that or.
Speaker Change: Because of some of the work we're doing on the Radian front. So we've decided to process some of our feet of uranium feeds and that's why it jumped contract sales very light for 2020.
Speaker Change: Twenty-five at around 220000 pounds, that's down a little bit, but that doesn't really upset me because.
Speaker Change: I'm still looking for these higher uranium prices in due course finished goods we plan to have between 925000 and the one point to two five.
Speaker Change: But 1.2 million.
Speaker Change: By the end of the year, that's up 193%. So we're going to have a lot of finished goods, but look at those inventories because not only can we select the time, we want to process that ore. We can also store and stockpile in process. It later, we do not have to spend that money if we have it.
Speaker Change: Sitting at the mill.
Speaker Change: In inventory so we plan to have between about two and two and a half million pounds of inventory or to be process inventory, which is up about 14% now some people might say you know what does it cost to process the unprocessed inventories and it varies I mean it can.
Speaker Change: Very between 15 to $20 a pound sometimes it can be $10 a pound sometimes it can be 35, or maybe up to 40, but it is very easy and low cost for us to process that inventory when we want to put it into the market and we can do it quite quickly now having these significant inventories is also.
Speaker Change: Putting us in a great position that we can flip the mill back in process rare Earths.
Speaker Change: Potentially early in 2026 by having enough inventory to meet our contractual agreements and also having material to put out on the spot market. If we elect to do so.
Speaker Change: Excellent.
Speaker Change: So okay, we'll talk about the rare earths in sort of the titanium zirconium products.
Speaker Change: As I said, just a minute ago. We may go back into rare Earths production in 2026, we're building up inventories of monitors light as we speak we're advancing the phase two.
Speaker Change: Our expansion at the White Mesa Mill. This is a separate plant separate from the uranium mill with a capacity of up to 6000 tonnes. A N D. P. R per year equivalent of latest and also recovery in about 225.
Speaker Change: Metric tons of D Y in 75 metric tons of T b per year a M.
Speaker Change: And that update will also come up with updated capital and operating cost for that we are currently piloting D Y N T b and when we talked about that we had these capabilities to separate additional rare earths, including these heavy rare earth, we can do that so.
Speaker Change: Again remarkable capabilities at the White Mesa mill totally our project is moving towards F. I D.
Speaker Change: Should be expected in the first half of 2026, we're continuing to starting to look at pursuing potential offtake sales and financing options. We're also pursuing final agreements to ensuring an agreed fiscal terms until they are with the Madagascar government and we're really excited.
Speaker Change: About that to keep pushing that along the Madagascar government. Once this project we want this project and it is an important project for the United States of America on securing world scale critical minerals. When you look at our scale of our project.
Speaker Change: Of our goals as we move this forward, we can produce between 50% to 100% of 10 critical elements for the current demand of the United States of America. So it is absolutely significant the Donald project is also moving forward with F. I D.
Speaker Change: <unk>.
Speaker Change: We're continuing with drilling on.
Speaker Change: On the Bahia project in Brazil, and we're continuing to develop our final comprehensive project finance strategy.
Speaker Change: That's it.
Speaker Change: Any questions.
Speaker Change: Okay.
Speaker Change: Constantine latest Lady.
Speaker Change: Ladies and gentlemen, we will now begin the question and answer session should you have a question. Please press star followed by the number one on your Touchtone phone if you.
Speaker Change: You will hear a prompted that your hand, that's been raised should you wish to decline from the polling process. Please press star followed based on number two.
Speaker Change: If you are using a speaker phone please make sure to lift your handset before pressing any keys.
Speaker Change: Your first question comes from the line of Katy Elasha town from Mccann Accord Genuity.
Speaker Change: Ask your question.
Speaker Change: Hi, Mark Thanks for taking my question, it's great to see the increase in expected uranium production for 2025.
Speaker Change: I do will ever want to focus a bit on the railcar segment, we've seen your your balance sheet improved quarter over quarter with.
Speaker Change: Activity on the ATM.
Speaker Change: But on our numbers, we're still seeing a pretty significant gap between the projected capital costs in your current balance sheet. So how are you thinking about.
Speaker Change: Central funding stack for the phase two expansion a white Mesa in addition to advancing totally Donald.
Katy: Yeah Katy.
Speaker Change: As I said at the end.
Speaker Change: We're putting together a comprehensive financing strategy.
Speaker Change: We've already got some.
Speaker Change: That advisors on totally our and Donald we're looking at adding a significant U S bank to help us with that in addition, where we are.
Speaker Change: We're making the rounds.
Speaker Change: <unk> D C.
Speaker Change: Places like the D O D Exim bank.
Speaker Change: D O E and all that so and as I said, we're looking at potential off takes potential there could be potential people willing to fund in some of these projects. So it Katy it's really I'm going to be from a number of sources.
Speaker Change: Our strong balance sheet allows us to advance all these projects through this process to get all the accurate numbers.
Speaker Change: And estimates are for bankable purposes, and but I do believe that when you look at the scale and the low cost nature of what our plan and strategy is when I talk about 50% to 100% of U S requirements. We.
Speaker Change: We will secure funding now it doesn't mean, it's going to be easy and it's complicated, but we we plan to have that strong balance sheet get to these F. AR and we're multitasking a number of fronts. When it comes to how we're going to finance these projects and I want to point out too one thing.
Speaker Change: Totally our project is so remarkable.
Speaker Change: That is it funds itself it doesn't find itself, but but it it can stand alone as a heavy mineral sand project only without any credits where the rare earth. So you know it's a it's a it's a really significant project really low cost structures.
Speaker Change: But we still have a lot of work to do.
Speaker Change: Understood and then maybe just one unrelated follow up.
Speaker Change: Make any uranium sales in the quarter, so kind of it's kind of two questions.
Speaker Change: Can you provide us with a level that would trigger you to make some additional sales into the spot market. This year.
Speaker Change: Then on the cost side, there were no reported costs for this quarter. So how are how are your cost tracking right now and how do you expect them to track through the remainder of this year.
Speaker Change: Yeah, you know as I said earlier I really don't like to sell uranium at these prices because I think it's below the cost of replacement, but I.
Speaker Change: I'd like to see something.
Speaker Change: With the eight eight handle on it or greater.
Speaker Change: When you look at our cost for the quarter, we really just ramping up some of the mining we had the delays with the.
Speaker Change: The ore transport across the Navajo nation, but our most recent estimates are that are are the combined cost going forward and for the year are going to be between about 35 and $40 per pound Katy.
Katy: Perfect. Thank you Michael.
Katy: Okay.
Speaker Change: Your next question comes from the line of Heiko Ely from H C. Wainwright. Please ask your question.
Heiko Ely: Hi, Mark it's actually a case on dogs on behalf of HEICO.
Speaker Change: Alright.
Speaker Change: Awesome.
Speaker Change: Quick question on our opinion claim seems like things are going pretty well could you maybe give us any color on if theres been any unforeseen supply chain issues throughout the process and have any idea of how much money you spend the plan to spend at the site during Q2.
Speaker Change: Well look.
Speaker Change: There haven't been any issues.
Speaker Change: At the at the site.
Speaker Change: Since we signed the agreement it wasn't applanation, what one of the issues has been just getting the trucks spooled up to haul the ore to the mill.
Speaker Change: Which were working to resolve.
Speaker Change: You know we indicated that for Q2, we already had this 150.
Speaker Change: Pounds mind, and that's continuing on I mean, they got a text from mine. This morning, it's going it actually go higher than that.
Speaker Change: So as I said, the Katy you know homogenize basis, we're looking at that 35 to $40. A pound are the mine is largely developed so a lot of the expenditures. There are just focused on producing ore and shipping it to the mill. So did I cover that all for you.
Speaker Change: That's great and I.
Speaker Change: I guess to touch on the earlier question, we like seeing you buy uranium below 65 a pound.
Speaker Change: And that was a great cash balance do you anticipate converting any more cash and the inventory Q2 and beyond and is there, possibly a mental maximum price for doing so.
Speaker Change: I wish I'd bought more at 64.
Speaker Change: But yeah, well, we're going to just play it by ear I mean.
Speaker Change: Well you know if we if we can.
Speaker Change: Our going forward cost at 35 to 40 that kind of gives you an idea of what we can we can put it in a drum finished goods, but you know again they just.
Speaker Change: We're going to always look at mix and match and if we think we can pick up with some product at a price that we can turn around and sell we will consider that.
Speaker Change: Oh, Okay, great great color I appreciate it that's it for me.
Speaker Change: Okay.
Speaker Change: Yeah.
Speaker Change: Your next question comes from the line of Justin Chan from SCP Resource Finance. Please ask your question.
Speaker Change: Yeah.
Justin Chan: Good morning, Mark and team thanks for hosting the call My first one regarding.
Speaker Change: Just reading through your 10-Q.
Justin Chan: You noted that part part of the board.
Justin Chan: Logic for bringing forward uranium processing as you're thinking of doing a birth processing campaign next year are.
Speaker Change: Bringing up the mill circuit changes I was wondering if you could just give us some more color on what your current thoughts are for next year on the buyer side of things and what are the key moving parts.
Justin Chan: Yeah well.
Justin Chan: Exactly you know as I said, if we have this inventory, we kind of legs on how to process uranium or rare earth.
Justin Chan: So our thoughts were is to go ahead and build up our inventory, which you can do very quickly with the product out there to process.
Justin Chan: Have this other inventory that we can process later with the switch over the mill, if we need to and then looking at in 2026.
Justin Chan: Still getting material from <unk>, but we're also looking at other sources of feed our monocyte and right now we're getting a lot of inbounds from the U S. Government say what can you produce rare earth now what can you produce now and you know what we're the only ones that can produce now if we want to.
Justin Chan: And in addition to our ability to also do these are heavy rare earth.
Justin Chan: We're trying to position ourselves. So we can show that we have this incredible flexibility that this flexibility allows us to be in produce whatever they may need and if they need you know a scenario or whatever we can actually do that a we can't just with our nose into it but give us a few months.
Justin Chan: Or six months and some support and we have remarkable flexibility on that so so Justin this gives us that.
Justin Chan: That opening to be able to do either I mean, if we decide we want to keep producing uranium we'll do it.
Justin Chan: Want to switch over to rare Earths will do it.
Speaker Change: Gotcha. So so maybe just reading between the lines probably the key determinant right now is.
Justin Chan: There's perhaps some signals from the government.
Justin Chan: Absent a huge price dishwasher N D P or something like that.
Justin Chan: Yeah.
Justin Chan: That's correct I mean, if we get a signal from the government, we want to say we're going to deliver.
Speaker Change: In the United States.
Justin Chan: In Utah.
Justin Chan: Yeah.
Justin Chan: Gotcha.
Speaker Change: I'm totally all right could you give us an update on how things are going in country and I guess, what the next 12 months looks like between now and F. I D in terms of.
Justin Chan: So we can track progress over the next four quarters.
Justin Chan: Hum.
Speaker Change: I've got Tim Carson's here Tim.
Justin Chan: On the spot here okay.
Justin Chan: Here I might as well bring them in.
Joseph: Hi, Joseph.
Speaker Change: Hey, Kevin speaking is totally out.
Joseph: Yeah exactly.
Joseph: Yes.
Joseph: It's got a free carry focuses at the moment in a totally erawan is as Marc mentioned earlier its finalizing the agreements to lock in the fiscal terms with government and that's all we're making good progress.
Joseph: The government is amending its large mine investment regime at the moment.
Joseph: Good consultation with us.
Joseph: I'm comfortable with the direction that striking.
Joseph: On ground, we're doing a lot of work with governments on.
Joseph: I guess community.
Joseph: Once I sensitize action, but more just sort of making sure that we've got full community on side, we've got the the various I guess engagement and dialogue structures in place.
Joseph: Dialog structures between ourselves government and communities to make sure any any issues are addressed adequately that we avoid.
Joseph: The influence of the.
Joseph: Opponents of the project that aren't really modernize it around the project, but as you know from the past of attempted to use the project is.
Joseph: I guess a football for their own their own objectives.
Joseph: Working really closely with the government in managing that.
Joseph: <unk> got a really good position [noise] excuse me on that now.
Joseph: And on grab work is now starting to happen as we head towards <unk>.
Joseph: That's what being one of the challenges we've experienced over the last five years.
Joseph: As well in hand now.
Joseph: On the project side, there's quite a lot of work that needs to be done over the next 12 months or so as we head towards EFI day quite a bit of geotechnical drilling that needs to be done, particularly in relation to the bridge and the port facility.
Joseph: Dave.
Joseph: Long lead time items for that.
Joseph: We're basically building the time at the moment as you know with our approaches to bring on a lot of the operational people early and embed them in the project side table lockout JM operations are already in place.
Joseph: And now they're starting to assemble their time to sort of drive that we've put in and project execution. So that's that's coming together quite well.
Joseph: Quite a significant spend.
Joseph: Over the next 12 months as you as you would expect for a projected to scale them. So yes at this stage, we're well on track for EFI day as Mark said in the first half of next year.
Joseph: Gotcha.
Speaker Change: Is there a plan to kind of put I put out updated capex and I guess I guess high level economics, and roughly went along that timeline do you think that would be.
Joseph: Yeah, what we're in the process of completing that now the intent is to release the full updated DFS.
Speaker Change: In I think it's due in June.
Speaker Change: Maybe early July which will sort of form the base itself to the next phase of execution of the project. So that will get released to the market with a full update.
Speaker Change: And also have Friday devices.
Speaker Change: That funding so that'll become the debt funding model.
Speaker Change: Okay. That's that's June early July this year like in the coming months, Yeah, Yeah, a couple of months.
Speaker Change: In the final stages of that now.
Speaker Change: Okay got you thanks, very much alright. Thanks, thanks, very much all I'll say at the Leiden rejoin us I think more questions. Thank you.
Speaker Change: Thank you Tim has her next question.
Speaker Change: Yes.
Speaker Change: I'm sorry. Your next question Sir comes from the line of Zachary from Robertson Stephens. Please ask your question.
Zachary: Hey, Mark Thanks for the question.
Speaker Change: A quick question on the.
Speaker Change: The railroad side Oh.
Speaker Change: That's at scale, and how you're going to find that.
Speaker Change: What is your cost structure relative to.
Speaker Change: Other projects around the world.
Speaker Change: Obviously, if you have if you have the feedstock.
Speaker Change: And you look at your future what would you be your cost structure, just not just United States, but relative to other projects around the world.
Speaker Change: Yeah.
Speaker Change: We're finishing all of our studies, but at scale. We believe we're gonna be if we're not the lowest cost we're going to be the second lowest cost in the world is what we believe okay now how China fits in but certainly outside of China, We're gonna be low cost producer and we will be producing in the United States and a lot of that is driven.
Speaker Change: The fact that the the.
Speaker Change: Contribution of these various project, particularly totally Ara with the scale of totally are in the low cost structures until they are is going to provide us with a supply of modest like significant about half of the mill's capacity and it could be more in due course, if we want to upgrade it effectively for free so.
Zack: That's a pretty good start Zack.
Speaker Change: Yeah. So it sounds like you're very low carbs without totally are and you basically get almost free feedstock, assuming tobi or is <unk>.
Speaker Change: Profitable on heavy mineral sands monotone is that a way it's.
Speaker Change: It becomes a counting exercise of where do you want to account for it but yeah yeah.
Speaker Change: But yeah no it's.
Speaker Change: Is it these pieces as you said at scale and that's a big part is at scale, because I mean phase one is at.
Speaker Change: The mill is about 1000 tons of N D. P R per year the.
Speaker Change: The expanded phase two is six X at right. So that makes a difference in terms of the fixed variable cost in terms of how you go forward. So.
Speaker Change: Just coming back to you.
Speaker Change: Your point.
Speaker Change: About.
Speaker Change: As a frame on it.
Speaker Change: I mean totally or just as a mineral sand project, so completely excluding any monoszon revenue.
Speaker Change: In terms of revenue to cash cost ratio, it's about four to one revenue to cash cost, it's pretty much the most profitable mineral sand operation and it will be a profitable mineral sand operation in the world Excluding monoszon.
Speaker Change: So.
Speaker Change: That's one of the real strengths of that as a project and how it contributes to a relatively low risk why for LNG fields to develop <unk> capability relative to anybody else.
Speaker Change: Because you've just got that protection.
Speaker Change: Alright that makes a lot of sense so with that.
Speaker Change: Premium.
Speaker Change: U S government wakes up and if they're going to get in a trade war with China would want to get to a project up and running.
Speaker Change: How quickly could you get a separate R E.
Speaker Change: Line up and running assuming.
Speaker Change: Everyone showed up and said do it tomorrow.
Speaker Change: What's the timeframe actually get up and running you have full funding and everything.
Speaker Change: Well.
Speaker Change: <unk> one.
Speaker Change: A couple of months, Okay, that'll that'll do it N D P R.
Speaker Change: And we are currently piloting the D Y N C b.
Speaker Change: We've been telling the government that some of these specialty products.
Speaker Change: If they want they.
Speaker Change: One or two or three it probably take a six to 12 months, but we are looking at like a phase one b, which is the addition of other circuits to recover some of these other products. If the government wants them you know that we can we can provide them with a custom built.
Speaker Change: <unk>.
Speaker Change: Solution for that when it comes to the phase two mill, we've been talking about a phase phase two.
Speaker Change: First plant of.
Speaker Change: Of having it up and running in 2028.
Speaker Change: And that's kind of where it is on the current <unk>.
Speaker Change: Scale, but you know it is it isn't impossible to think that the government might not want to fast track that.
Speaker Change: We also have to make sure that that ties in with the mines and when these mines are up and producing so there is a little bit of a.
Speaker Change: Juggling one thing just kind of interesting is there are.
Speaker Change: Sources of monocyte out there in the world that people are looking at sending to us because they believe it it makes a lot of sense for them to send it to weight basis. So we're still exploring some of those options and opportunities. So that we have larger run of rare earth and being able to again.
Speaker Change: Process the rare Earth.
Speaker Change: At the mill or the uranium and being flexible. So so yeah. We're we're kind of just keeping our options open on how we go zac and.
Speaker Change: But theres a number of pieces to this.
Speaker Change: We can we can orchestrate as required.
Speaker Change: Great. Thanks, Yeah, I mean it looks.
Speaker Change: It'll be exciting, it's a fast timeframe without pushed by the.
Speaker Change: S government, but.
Speaker Change: In the U S government.
Speaker Change: Fishing search go faster so it looks pretty interesting thanks guys.
Speaker Change: Your next question comes from the line of Noel Parks from Tuohy Brothers investment Research. Please ask your question.
Noel Parks: Hi, good morning, So I will.
Speaker Change: Just wanted to check back on the.
Noel Parks: Navajo nation cleanup.
Noel Parks: The profit from unlocking the dedicated funds for that.
Speaker Change: Is that something that would involve any financial commitment from energy fuel and <unk>.
Noel Parks: Capital or our operating site.
Noel Parks: And if so just wondering about the scale of it or just a few thousand in G&A or something larger.
Noel Parks: Yeah, the agreement that we did.
Speaker Change: With Pinyon plane, we agreed to 10000 tons.
Noel Parks: We call it an.
Noel Parks: And take it for free.
Noel Parks: With the options that can be expanded later on.
Noel Parks: There really is no capital investment required.
Noel Parks: But there is last I checked there was about $2 billion in trust.
Noel Parks: For the Navajo nation to clean those sites up and so you know one of our goals working with Navajo nation. We put out. This this offer for the free material so that they can be comfortable.
Noel Parks: And see how it actually works.
Noel Parks: So there's no cost to us we can take it right now and we'll probably start taking some of that material that 10000 tons. This year, it's really about them deciding which site would they like us to take it from again that material change uranium we can process. It we get free feed.
Noel Parks: Well the initial 10000 tons, where we're hauling it to the mill so there's a number of.
Noel Parks: Current ways this could roll out.
Noel Parks: Have had.
Noel Parks: With the new administration discussions with the EPA and the Bureau of Indian Affairs, and the Navajo Nation and they are keen about working with energy fuels.
Noel Parks: Because they know we can do it right now like a lot of things right now and.
Noel Parks: There's not been a lot of action on the Navajo nation on this cleanup and this is just the perfect way that we can work with the Navajo nation with this ore haulage contract. They can see how the ore is hauled across the Navajo nation.
Noel Parks: And also they can see the good we can do helping them with some of these cleanups that had been stagnant for 50 years.
Noel Parks: Great. Thanks, Thanks for that.
Noel Parks: The clarification and.
Noel Parks: You know are you talking about the potential catalyst.
Noel Parks: The government deciding it that's the wanted to move forward with them.
Noel Parks: Some of the.
Noel Parks: Minerals that you could produce.
Speaker Change: Do you have any sense of sort of the interaction when it comes to looking for.
Speaker Change: I guess funding overall for various projects in the company because.
Speaker Change: Because I think our.
Speaker Change: Government financing good terms, but tends to move slow.
Speaker Change: And I mean is it possible that there could be sort of like.
Speaker Change: A larger package.
Speaker Change: Could you know help with White me try to help with that.
Speaker Change: Uh huh.
Speaker Change: A critical minerals, there help with totally IRA or or do I really need to think of them as just sort of entirely separate.
Speaker Change: Thrive.
Speaker Change: We're.
Speaker Change: We're actively talking to the U S government on every front right now multiple groups.
Speaker Change: We're making proposals to the U S government on multiple fronts, they can be large or they can be small and we want to.
Speaker Change: Tap into whatever makes sense, but youre right a lot of the government funding.
Speaker Change: Takes time and is slow so you got to look at the balance between Kerr commercial options government options, how those fit together.
Speaker Change: How prescriptive they are getting.
Speaker Change: Getting those funds you know theres, a number of different variables, but but no. We are we're actively working with the U S government in providing them options just as I've discussed in this presentation.
Speaker Change: And if it makes sense.
Speaker Change: There to deliver.
Speaker Change: Great. Thanks, a lot.
Speaker Change: Okay.
Speaker Change: Ladies and gentlemen, as a reminder, if you would like to ask a question. Please press star followed by the number one on your Touchtone phone.
Speaker Change: If you are using a speaker phone please make sure to lift your handset before pressing any keys.
Speaker Change: Your next question comes from the line of Richard White Private Investor. Please ask your question.
Speaker Change: Right.
Richard White: Hello, Mark.
Speaker Change:
Speaker Change: You May then how are you.
Speaker Change: I'm doing pretty good mark.
Speaker Change: You mentioned you have a purchase contract with a third party in the region of the White Mesa Mall.
Speaker Change: I was wondering are you.
Speaker Change: Do you have or are you anticipating a buying schedule for the other small miners in the region, who could get into production.
Speaker Change: Yeah first of all good to hear your voice.
Speaker Change: Well, it's no secret that western has put out a press release that we're buying there there or where do you think you can appreciate this that.
Speaker Change: Going back 2030 40 years.
Speaker Change: There were a lot of mines it could.
Speaker Change: Fifth feed into a buying schedule and now there aren't that many okay. So we've kind of taken the approach that if somebody has a mind it's fully permitted in compliance just come visit us and see what we want to know.
Speaker Change: The quantities and the grade and we'll just kind of work out a special arrangement if it makes sense to us.
Speaker Change: To go forward. So you know.
Speaker Change: To put out a blanket buying scheduled there's so few people, it's too difficult because the variables like the grade and the and even the metallurgy in some cases is that uranium vanadium or what is it if so.
Speaker Change: But yeah, if there if somebody has a mine.
Speaker Change: I would say.
Speaker Change: You know give us a ring gift Curtis ring, and we will see what can be worked out or not.
Speaker Change: Okay. Thank you.
Speaker Change: Yeah.
Speaker Change: Yeah.
Mark Chalmers: Thank you there are no further questions at this time I'd like to turn the call over to Mr. Mark <unk> for closing comments Sir. Please go ahead.
Mark Chalmers: Yeah, well again, thank you, everyone, who joined us call or listens to the replays.
Mark Chalmers: The next few days.
Mark Chalmers: Exciting time for energy fuels.
Mark Chalmers: Pieces are starting to come together on multiple fronts, but I also want to say that you know some people have questioned our conviction to the uranium business and I think that the numbers that are starting to come out with our uranium production and the scale and the cost.
Mark Chalmers: Show that we're not out of uranium business.
Mark Chalmers: We still have a lot of work to do opinion, Planed mine, which I built in 1980, 7% to 38 years to go from when I built it to getting the ore to the pad at White Mesa.
Mark Chalmers: Is really paying dividends and out of the set of things the highest.
Mark Chalmers: Grade uranium project I've seen in my career, a deck, if you're still listening I know we worked at the Schwartz Walter which was had some hike rates too, but not at this kind of scale. So.
Mark Chalmers: So yeah, it's exciting time and we're pulling it together.
Mark Chalmers: I think we couldnt be in a better place with the critical mass we have.
Mark Chalmers: We're not a tender we're out there to deliver an outcome that's extraordinary.
Mark Chalmers: <unk>.
Speaker Change: Thank you for participating in the energy fuels conference call. Please reach out to the company directly for any additional investment questions. Please.
Mark Chalmers: This concludes today's conference call you may now disconnect.
Mark Chalmers: Yeah.
Mark Chalmers: Yeah.