Q2 2025 Energy Fuels Inc Earnings Call
Good morning. My name is Jeanne, and I will be your conference operator. Today, at this time, I would like to welcome everyone to the Energy Fuels second quarter 2025 conference call.
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Thank you, Jeanne, and thank you for the introduction again. Mark Chalmers, CEO of Energy Fuels, and thank you for joining our Q2 conference call today. I can say with absolute confidence that we had a big quarter with regard to momentum on many fronts, and I don't believe our timing could be any better.
Namely rapidly advancement of our uranium production with very high grades. Being mined dropping unit cost increasing production rates as we ramp up to 2 million pounds per year,
And we expect the pinion plane costs to be around $23 to $30 per pound of finished goods of your uranium, which are exceptional.
And q1 cost.
We're also rapidly advancing. Our rural Earth separations with the expansion of the White Mesa Mill, Phase 2, and significantly improved rare earth pricing, particularly in China. The prices in China for Dy and Tb are approximately 350% higher than U.S. prices, and at the same time, NdPr prices are up about 20%, currently in the mid-$700s, in the last month.
Our heavy mineral Sands, uh, portfolio is also rapidly advancing. So there's no shortage of things to do at Energy Fuels we, we received our final regulatory approvals on, the Donald project, which is Rich and heavy. We're also advancing our feasibility study and Engineering, the completion of our feasibility, study on toliara, and the other agreements, uh, with the Madagascar.
Our government and the permits and drilling at Bahia.
We have improving financial results and have strengthened our balance sheet as compared to Q1 2025. Our costs and margins of uranium production are improving materially as Pinion Plane is planned to be processed starting in Q4. Pinion Plane has been processed as of this date.
As I typically do, I'm going to be making a short presentation to update listeners on the overall strategy of the company and the state of play of the company. I believe that you're going to be controlling the slides. Is that correct? Yes, Kim. Um, there will be conference replays available at the completion of this conference call on the website and as always, there will be time for presentations at the end of this presentation.
Our CFO and David Freeland are executive VP and chief legal counsel will be available for questions that I'm unable to answer in addition, it is my pleasure to have Ross, the Pooh, our new president with us while Ross, is new to our organization. He is not new to mining. Feel free to ask questions uh of Ross at the end of the presentation on his past experience in the resource sector or his first impressions on day 4 with energy fuels.
So, let's get going.
So again, our story is different because we are building a Global critically significant critical Mineral Company. I always tell everybody I love this picture, this is in San Juan County. It's not far from the white Mesa Mill which is our critical mineral Hub. That is advancing in Leaps and Bounds next slide.
Okay, I may be making some forward-looking statements, those are included on page 2 of this presentation.
Next slide.
Again, many of you have seen this really Energy Fuels is basically 3 businesses in 1 um with the 3 sectors that we've been advancing and focused and built around. Our core uranium business which as I said is ramping up very quickly and turning into immediate cash flow at large scale and low cost. I believe largest scale and lowest cost in the entire United States and competitively lower quartile in the entire world and we're very excited. We'll talk more about that. Certainly the rare Earths were emerging as a global leader, uh, on the rare earth fronts with our ability to separate ndpr Dy and TB and heavy, mineral Sands with the heavy mineral, Sands projects that we've acquired for titanium and zirconium minerals. So really 3, uh, sectors, basically, in 1 company, energy field,
Fields which those 3 and 1 equates to about 10 critical Elements, which gives us broad diversification and sort of the Peaks and valleys in the volatility of a lot of the critical minerals that we've seen over the last couple years. But all 3 of these segments have 1 common denominator and it has a natural occurring, uranium, uh, which is all our basically, uh, significant advantage that we have.
Have is a company and our ability to deal with that at the white Mesa Mill.
Next slide.
All of this.
Is in demand, your hearing about these critical minerals every day. Whether it be for energy defense, Mobility, health, or improvements in electrification, uranium certainly the focus on fuel for clean base load energy. Data centers space. Travel uranium is back front and center globally in particularly in the United States and developing countries where you're now seeing bipartisan support.
Rare Earth.
Energy Fuels is becoming a leading producer of rare earth Oxford. Oxides also used in uh, Energy, Efficiency Automotive events, manufacturing defense and Robotics and other Technologies.
The heavy mineral Sands projects that we've acquired our world scale world class uh and basically contained the titanium and zirconium minerals and monocyte. So that is part of those 3 sectors that we have that all fit perfectly together.
We also are a leading producer of the nadiem, uh, and we have a veniam circuit at the Mill. It's currently not operating, but it is the only conventional vadyam circuit, uh, in the United States. And it is also a critical mineral.
Medical Isotopes were still advancing in R&D, uh, work on the potential to recover radium, uh, for emerging medical Technologies.
Next slide.
Uranium highlights, we're producing more uranium than anybody else in the US today.
That would be 2.7 million pound rate. So, um, again, we had very high grades at that point in time, we're not changing our guidance at this point in time, but it just gives some example of capacity when the right stars align in 2025, um, our guidance that we haven't changed it yet. Uh, is between 875 to 1.4 million pounds of uranium, newly mined uranium, where you can see what we produce in a quarter. So we're really getting all the pieces in place when it comes to our mining, including additional trucks to haul, The Ore from the pinion plane, mine to the mill. Uh, but again, uh, this is all ramping up very quickly.
And working towards uh, a 2 million pound run rate which many of you know, I've been talking about for years. Well, we're getting there and this is a run rate that we don't require a lot of capital. We've already spent the capital and it really is just getting the mining going. Getting the miners, hired, getting the reagents in place. And um, and it but it it is also going to be at very attractive costs. So watch this space as we ramp up the mining, which then goes to processing. So processing at the white Mesa Mill, uh, while we're also building significant inventories at the Mill and the first half of the year, we produced 330,000 pounds of finish, uranium, and most of that was a, a mixture
Of Lal or alternate feed and clean up material. So, it wasn't at this ultra high grade that we have at the pinion plane. Mine.
So for 2025, we expect to have finished uranium between 700,000 pounds in 1 million pounds. Um by the end of the year and 1 of the reasons, it's not more, is we're preparing the mill to run hard.
The mill has not been asked to run this hard for decades. So there's a lot of work that's being done on the mill. There's a lot of orb that's being mined and delivered to the mill to get that material to be available for feed as a mill starts up. And we're also looking at things like critical spares because again the mill hasn't run this hard. So there's a lot of work going on but when the mill is actually running with pinyin plane, or it can be doing approximately between 230 and 250,000 pounds of finish uranium per month, that it runs.
So there is a bit of a lead lag between the time, we mine things and we process things and we do a campaign run and I think that's important and we'll go into more detail today on that because it's important for investors and analysts to understand those Dynamics.
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So, uranium moving forward, the newly mined ore. Um,
I expect that we're going to be able to mine 1.6 million pounds per year or greater going forward from 2026. We still have a lot of expiration to do in the Juniper Zone. But what what, we're seeing, um, you know, we're super encouraged with, uh, the grades. We're seeing the increases in uranium that we're finding in the main Zone, the Juniper Zone and literally pretty much everywhere. We drill we're seeing defined additional or but we have more work to do on that front, um, The Mill, Run that the next Mill, Run is planned to be, uh, beginning of October, and that's going to go from the kind of Q4 into 26. Well, this Mill, Run the next Mill. Run we expect back to uh produce between about 1.1 to 1.4 million pounds of finish uranium during that run. Uh, when you look at Pinon plane and this is this is a what's extraordinary?
On average pinion plate or Mining and transport cost.
Are expected to be ten dollars to 14, dollars a pound recovered.
That is remarkable. And when you look at that after it's processed. So now for 10 to 14, dollars a pound, it's delivered. And then when you process that or
The cost of processing about 13 to 16 dollars per pound. So when you combine those that's when you get cost of 23 to 30 dollars per pound recovered and we believe those are absolutely exceptional uh, to our peers.
Not just United States but globally.
So as we ramp up our uranium production, particularly with these lower costs, pinion plane, alternate feed and other mining feeds from wherever we're getting from Pandora or Lal. We see these weighted costs to start dropping um, and we expect them to be between 30 to 40 dollars per pound in q1 of 26. But as more opinion plane or is mine, these costs should continue to drop. So you know we're in a position where we have to clear out the existing cost of goods um uh in inventory to this transition, as we ramp up our uranium production and get the economics of scale and the benefits of the higher grades.
Next slide.
So, pinion plane and I've said this to many of you, I built that mine in 38 years ago and it is exceeding my expectations on every front with regard to the grades, the low cost and larger than originally expected with upside expiration potential. And earlier part of my career, I mind 4, Brea pipes and matter of fact, the largest most successful breach of pipe Evermind on the Arizona strip was hacked 2 and it was about 7 million pounds of uranium. And it is my hope that pinion plane is going to be much better than Act 2. But we still have expiration to do to to further quantify that, but it absolutely has better grip.
Rates and hack 2. So that's a really a great outcome for our company, particularly at this point in time.
So, you know, we discussed and I said, we mined over 600,000 pounds in the 3 months. Uh, ending June 30th, great outcome. Um, the grades have been
double in some cases, triple, what we expected in certain areas. Um, there we, we likely believe that there's going to be more ore and what we call the main Zone, um, and then we shift to the Juniper Zone, which is lesser explored. Uh, and it is starts just literally a few hundred feet, a 100 to 200 feet below the main Zone, the recent expiration, drilling that we've done. Uh, has confirmed super high grade areas, uh, just below the main zone. So we're driving drift down to that it lower Zone. It will be putting in additional drill stations to expand that approximately half of the breach of pipe that this ore is contained in, has had very limited expiration so that's why we're really encouraged about the upside. So
In the little box that little yellow box. I talked about the 23 to $30 per pound. Really commencing in Q4 of 25 and going into 26. Um and as we are able to deplete this existing cost of goods sold that I mentioned at that 50 to $55 per pound and shift over to more pinion plans
Or our cost of sales will drop materially. And as I said before, and I want to repeat none of the high-grade from pinion plane has been processed to date, we have to get that or process, where we see those very low costs that I mentioned about, getting that material to The Mill at these exceptional costs.
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So we continue to grow our portfolio of long-term uranium sells contracts, we have 4 existing contracts. We are continuing to look at other opportunities as they present and particularly as they present with the growing uranium production that we are seeing and expecting, uh, this year and into next year, and on for a number of years. Uh, we have, uh, 300,000 pounds of contract, deliveries that are happening in the last 2 quarters of this year. So you're going to see a real increase on our contract sales coming in strong, but we also have the ability to make spot sales. If we elect to, uh, even in 202526 going forward, we will have plenty of finished goods to do that. If we elect to there has been a reluctance for us to put product into the market at like the 70 dollars per pound. We did sell a small amount for 77 dollars a pound, we still
Believe the price uranium is going up. And so, we're going to just play that by ear, but we're really looking at ramping up our Revenue stream and our margins, uh, over the next, uh, literally over the next few months. We also have an agreement to purchase, or from a third-party minor, not too far from the mill and we have or coming in from that third party at this time. Next, slide,
let's,
Flipped 1 page too soon. Okay. So we'll we'll shift gears from uranium to Rare Earth and heavy mineral Sands. Um, as I said earlier, making rapid, uh, a progress on that front. Uh, and, and really getting a lot of recognition as a emerging, uh, rapidly expanding, uh, producer of rare earth oxides, uh, ndpr that we've made with our Phase 1, uh, run that we did. Last year is currently being validated with a number of metal alloy, and magnet manufacturers have very encouraged with the results that we're getting from that feedback. Uh, you know, we announced the arrangement or the relationship with Pasco. Uh, we're piloting heavy, uh, rare Earths as we speak. And we've had a few releases on that. Uh, we plan to have 1 kilogram of Dy, oxide 99.5 pure, uh, in August this month, uh, expanding that to about 15 kilograms of Dy, uh, by October.
Over of 25 and then, um, a kilogram of TB, uh, expected, uh, 99.99% pure in October. So, all that information gives us the ability, um, to have our plans solidly in place for going towards a commercial production, plant, uh, quite rapidly. Uh, as these things evolve and we have the technical ability to produce all the rare.
Earth oxides that are currently under Chinese export restrictions.
We are advancing The Phase 2, feasibility, study at the Mill, that should be completed, October and November. And that increases the capacity to produce Mahanoy or process Mahanoy from 10,000 tons, which is our Phase, 1 kept capability to 60,000 tons per year of monocyte and that is equivalent to Linus scale. So, this is a large scale facility in United States of America. The, uh, final investment decision on Donald is still pending. It could be as early as December of 25, but it is fully permitted. Shovel ready. Heavy mineral Sands project with exceptional, rare, heavy Rare Earth oxides very high grade over 2% Dy and about 0.4%. Um, uh, TB. So we're really excited about that. And very few companies have fully permitted projects that are shovel ready. We're also advancing Tolar project in Madagascar.
Mascar were advancing the final investment agreements with under negotiation with the government. And the toliara feasibility study is very Advanced and should be out fairly soon. But we got to make sure that we clear all the final reviews by legal and whatnot particularly with regard to United States compliance. But the final investment decision for Tolar could be as early.
Early as 2026.
Next slide.
Let's talk about Monae because Monae is our structural advantage in the rare earth business. The ability to process it at the white Mesa Mill. And it is simply a superior rare Earth, mineral concentrate.
super high-grade, 50% to 60% more NdPr
More mids. More Heavies, lower costs.
Includes a credit for your uranium, easy to process and high recoveries, and we are the only facility in the United States that can process monazite.
Those pictures on the side. Those are commercial-scale recovery SX circuits.
Most people are still doing things on a desk or on a lab scale. And this is a commercial facility that operates and Below 1 ton bags. Super Sacks of ndpr not in a beaker. So we have proven our ability to produce ndr at specification and we're rapidly advancing the ability with our piloting and our future plans for commercial scale recovery of both the mid and the heavy Rare Earth oxides. It could be used for defense needs next, slide
We are um the the Donald project is a world-leading uh Heavies uh deposit and the concentrations that we have, as I mentioned, it shovel ready? It's permitted and with the rising prices of rare earth oxides, and particularly the growth. And the Heavies, we are absolutely in a fantastic spot Benchmark um, has done a new update of both in China and out of China. Prices ndpr prices have gone up about 20% in the mid 700s as I mentioned. But what is really extraordinary is Benchmark is published publicizing Dy prices in Europe,
Of 800 per, um, kilogram as compared to 230 in China. So that's almost 3 and a half times higher for Dy. And when you look at TB, it's effectively the same thing that the um the the China prices around a thousand dollars per ton, but in Europe is 3,600, which is 3.6 times. So this is really an unusual circumstance that we have, where people are saying they will pay more than China prices for products that are not coming out of China next slide.
So, this timeline, um, you know, many of you have seen this before as we're advancing, you know, the Donald project, the Bahia project, the Totten project; those all equate to linchpin scale and, of course, once those are fully permitted, constructed, and operating. But at the bottom, I just want to highlight that we are ramping up this uranium production from 2 million pounds. In due course, it could be up to 5 million pounds, while the uranium sector of our business is generating material cash.
Material cash. And when you look at the margins that we can generate with the increase, uranium production in even current uranium prices, it is extraordinary.
Next slide.
We'll talk a bit about our financials next slide.
So really producing low-cost uranium end of June 30th. Um, developing Tier 1 critical mineral acids, maintaining a strong balance sheet. We had liquidity at the end of June 30th of over 250 million dollars. Uh that's about 253 million of working capital uh a large component of that cash cash equivalents and liquid Market Securities. Um,
And and also, inventories and various trade, uh, receivables. The finished product inventory, was nearly 60 million. And if you, um, add that, uh, current commodity prices, you could add about 13 million to liquidity. The I talked about the finished goods, uh, of uranium. We also have nearly a million pounds of an 80m 9000 kilograms of separated, um, ndpr and carbonate. Um, and well, I should say 9,000 kilograms of high Purity, partially separated mixed Rare Earth carbonate, and 37,000 kilograms of separated, ndpr and inventory.
No debt. We have a lot of assets and no debt and that in itself is exceptional. We did have a net loss in Q2, uh, really on a number of factors. But mainly we, we elected not to sell a bunch of uranium due to the low uh, and weak, uranium prices, we're also spending a lot of money on development in general, operating costs to advance these 3 projects that we have. Um, the net loss was a 22 million or 10 cents a share that is an improvement from q1 which was a net loss of 26 million and 13 cents a share. And as we start getting to this, um, increase uranium production, the pinion plane or and everything, you should see a very
Very dramatic Improvement, uh, because of the Investments we've made, uh, and the positioning and the momentum that we're securing their, we did sell, uh, 50,000 pounds of uranium at 77 per pound. I think I've mentioned to a number of you that I don't want to sell, uranium below, 80 a pound. We took a small sale there but we again are focused on cash flow in our margins and um moving the uranium sector to profitability as quickly as we can. We did have a 31% margin on that material that we sold.
Next slide. Let's go back to the kind of the wrap up on uranium.
actively mining, or
3, conventional Minds were actively processing. Uranium ore, including alternate, feeds and cleanup material at the Mill. Uh, increasing levels of contract cells, as I mentioned, later, this year into next year and building on that going forward, the cost of goods is going to go down trending lower starting in Q4 with the the low-cost pinion or being processed. Um, we will opportunistically look at selling, uh, Uranium on the spot or in the midterm markets. Again, we'll play that by ear, but we are actively looking for a home for a lot of the uranium that will have that will be marketable and sellable at short notice, uh, we are increasing the uranium production, uh, up to around that 2 million pounds plus. And as I mentioned, we expect the pinion plane line to be producing a 1.6 million pounds or greater. So, you can see
We're going to get there with alternate feed and the other feeds that we have from the other Minds. Um, we are advancing the permitting on 3 large scale, uranium mines, we have the Roka Honda on the fast 41, uh, government list. And we can increase production over time beyond the 2 million pounds up to 4 to 6 million pounds and we're continuing to do the R&D on the radium recovery.
Which potentially can be used for medical isotope, cancer treatments.
Next slide.
So we haven't materially changed or guidance on any front but I do want to point out a few things because I think this slide says a lot and it's important certainly for analysts that. As we mine the uranium that doesn't mean it's instantly processed. So we have guidance of 875,000 pounds to 1.435% in a single quarter. So if we're mining uranium at Full Tilt,
You know, we can get well past that but we're keeping guidance where it is right now because we're ramping up our Trucking and we're getting our mining fully in place the alternate feed, uh, we haven't changed anything. But alternate feed still is a very material part of our business up to 200,000 pounds for the year. The processing of uranium the 700 to 1 million pounds. I talked about getting the mill ready. The, the, the critical spares ready, when the Mills running pinion plane or 230 to 250,000 pounds of finished goods per month when the Mills running. So you can see you can run it for 4 months or 6 months or 7 months or 8 months reliably and you get large quantities of finished goods at large margins uh sales under contract and the small sale that we did um earlier uh at 3.
350,000 lbs, we are going to focus on making spot sales if it makes sense, or additional contracts to find a home. For some of that product finished goods by the end of the year, uh, and again, this could be subject to any spot sales, but between 900 and 1.2 million pounds of finished goods. That is enough for all our contracts this year. Next year, matter of fact, all the way through next year, depending on how many pounds we sell under spot. So total inventory is at the end of the year between about 2 million and 2.5 million pounds. Now, if you go up, just the next level above, you can see a big chunk of that is finished pounds, but it's also pinion plane pounds but it yet to be processed
Next slide and last slide.
2025 activities for the rare earth and heavy mineral Sands. Uh, we are looking at potentially being in a position to commercially produce Heavies uh, in 2026 following our current uranium run, but we definitely will have, have, we'll have the piloting complete, and we'll be looking at how we can ramp that up and do course. And only Energy Fuels has unique capabilities and how we can respond and do a lot of these things that others can't do uh, because of our unique capabilities at the white Mesa Mill, The Phase 2, uh Rare Earth, uh expansion at the white Mesa.
That Donald project FID, uh, could be, as early as this year later. This year, uh, potential offtake sales, financing options are being evaluated including that the increased costs and value, not cost. But value of the Heavies, totally our project, we're getting close to finalizing the feasibility study but also could well be in a position to make a final investment decision as early as 2026. Uh we're pursuing the final agreements uh at toliara that basically memorialize and formalize the fiscal terms with the government of Madagascar and we're um the drilling uh at Brazil and permitting of the beia project is advancing. We hope to have a resource estimate uh soon later. 25 or 26 and front and center is developing a final comprehensive project financing strategy because we have a lot of projects.
But we again are going to maximize this uranium sector um to generate as much cash as possible and take off some of the burn on these other 2 sectors that are developing rapidly.
So, I'll stop there and say, I'm now open it for questions.
That anybody might want to ask.
Time. I would like.
To remind everyone in order to ask a question. Press star, then the number 1 on your telephone keypad,
On your first question comes from the line of Nick, Giles, with B Riley carry, please go ahead.
Thank you very much, operator. And, uh, good morning everyone. Uh, my, my first question, you know, obviously there's, there's a ton of excitement across rare Earths and, uh, you know, I have to imagine others are trying to have discussions with agencies, uh, like the dod that I think you hinted to last quarter uh, for potential off-take and funding. So my question is really, what do you feel is the most, uh, critical differentiator, uh, specifically in the eyes of those agencies that gives you uh a greater likelihood for, uh, either offtake or funding? Um, so on, thank you.
Well, I think when we say we're going to do something, we do it.
And we also have the infrastructure. Um, to, to actually do it. We, you can take people to the white Mesa Mill and there's a, there's a built operable site with 100. Plus people working their Laboratories of phase 1, separation circuit. You've got product that has been qualified by some of the end users, uh, and
Do you see the number of projects that we've accumulated? I mean, we're not just a one-mine company. We have Bahia, we have the Donald project, we have Tara, and we have an agreement with Kimora Site from Florida and Georgia. So what they see is...
Scale.
Low cost, infrastructure in place and the the the skills required to advance.
And I think that really sums it up at a high level. You can go touch and feel it. You know, it's interesting. A lot of people are in D.C. talking about their projects, but they don't have any projects; they have a PowerPoint presentation. We actually have a fully constructed site and multiple projects that are advancing, in a lot of cases, permitted to events.
The molecules, we are the molecule machine and a lot of people are short of molecules.
All right, I appreciate that perspective. Maybe just to follow up. Um, can you just walk us through your plans to procure? Uh, sufficient levels of feed stock as we think about processing as early as Q4 26. I mean, should we think about this is coming from, uh, chem Wars or or could you explore, uh, you know, other sources, um, outside the scope of of Energy Fuels
Opportunities may be out there to procure additional material and stockpile it at the white Mesa Mill and then run it and do course. So. Um, so it it's, it's Dynamic. It's I don't have a complete answer there, but we're building up inventories. We're still talking to people about buying inventories, but once we get projects, like, the Donald project, if it's, if it passes, the final investment decision, it gets built, then we start having World material commercial scales that are coming from our own operations that we can depend on because it'll be coming at a regular rate and an expanding rate as we get these Progressive projects in line and operating
Market team. Uh, thanks for the update this morning and continue to best of luck.
Thank you.
Your next question comes from the line of ho a with the HC Wayne Wright. Please go ahead.
Hey Morgan team uh congrats on another good quarter. It's been nice to watch you guys. Transform the farm over the last few years here.
Uh, let's talk about pinion plane a little bit, the site. This is obviously a big driver for the farm right now. I mean, I I searched your press release and pinion plan as mentioned the full 20 times in it.
Uh, you mentioned $23 to $30 per pound in costs earlier on this call. And then in the release, you actually break it down to $10 to $14 for transport and $13 to $16 for a million costs.
Uh, great margin of those prices. Let's talk about what things could move us from the lower to the upper end of this guidance range. If you'd be so kind, I mean, especially on the mining and transport you got a 40% range. And and uh, is it, is it labor? I mean, you know, the mine uh sorry, the the the milk quite well. So I assume there's only so much variability there in that part.
Yeah. Uh, Hico, I mean, on the guidance, um, we're always trying to be conservative on our guidance and, you know, I was trying to hint a bit that if we did 600,000 pounds in a quarter. Um, you know, we can we can we can put a lot of pounds out there, uh, or send it to the mill. Our biggest limitation has been the truck and trucking from the mill, um, and we're building it up. We currently have about 10 trucks per day 5 days a week and we're trying to get that up to, um, uh. Well, it's it will average no more than on an average on a daily basis.
7 days a week, no more than 10 trucks per day, but that, that's really the limitation. I, I can tell you. If there was no limitation on the amount of or that we're hauling from the mill or to the mill, uh, we could be putting a lot of more uranium down on the ground right now, but what we're doing is as we're producing, um, the uranium we're also doing the required development work, down to the Juniper Zone as we, um, are advancing the development there, so that we can put in additional drill stations and we can do more drilling. So we're trying to keep it balanced. And, um, but yeah, um, the the, the trucking is the major major impediment there. But we're, you know, working to resolve that and we're building up momentum on that front. And also, it's a great dependent. So you have to have the, the trucks and you have to have the grade, um, the average grade we've mined thus far, uh, has been about 2%, which is very, very high grade.
So, you can get about 30 pounds per ton in every truck. Um, and so, that's the reason for the range; you know, we hope to be guidance, okay? But we haven't changed the guidance. And our goal is always to exceed guidance, but until we have all those pieces together, we're being a little conservative.
Fair enough. Fair enough, it's 1, 1 can read between the lines here a little bit better. Now. Um, you completely different question. You have the strongest balance sheet of farmers ever had since I started following it uh the way it is right now.
Arguably. This is even more impressive, uh, given your recent m&a. Conceptually has your internal thought process on minimum cash, or, you know, minimum working capital changed over the past, call it 12 or, or 24 months
Effective in a board perspective. Um, this the the focus has been just to maintain that strong balance sheet to have plenty of cash and be in a position that we are not short cash. Because the last thing you want to be in this business, the short cash particularly when your success makes you short of cash, depending on what, you know, makes you short of cash.
Okay, fair enough. I'll leave it at that and get back with you. Thank you. Mark and team and congratulations.
Your next question.
On the line of Katie, lapel with Canon cord, genuity, please go ahead.
Hey Mark, and thanks for taking my question. Uh 2 days ago. We actually saw some reports out of Australia that the Australian government is considering uh setting a floor price to support critical minerals projects, specifically rare Earths. So that'd be very similar to what the dod DOD did with MP materials. Uh, I'm just wondering in your discussions with you and your partners at Astron. Um, have you been in discussions with the Australian government regarding potential funding support for the Donald project or potential floor prices? And then similarly do you also think you could see similar support from the US government?
Uh yes Katie thanks for calling in. Um, yeah, there this this whole world is talking about floor pricing is to provide some protection to China manipulation and China cost. Um, yeah, we have had discussions with Aston, I had discussions with Australian government on all these things. Similarly, to what we've had discussions with the US government, I think the realization is that you will never be able to material break away from China, unless you have some level of support. And so I'm very encouraged with, um, uh, these announcements. And, and what what we're seeing with MP, um, because it just gives an insurance policy that China isn't going to flood the market and put you out of business. So, um, you know, it's all a work in progress. I mean, really when you think about it, the floor pricing, uh, discussions are fairly recent, you know, they've come out of the last month or so month or 2, um, but it obviously, uh, is getting additional traction. So, uh, again,
And I think we're ideally placed, you know, as I mentioned when you look at MP and Linus and we're the third largest uh market cap, publicly traded Rare, Earth company out there and you look at the scale that we have. Um, you know, I mean, I I think we're just so well positioned that, um, you know, the activities we've had, uh, Katie Over The Last 5 Years with the Acquisitions and the, the, the, you know, the the, uh, uh, advancement of our processing just puts us in a very, very
Very unique position.
Definitely, then maybe one follow-up on potential support from the U.S. government. Are you of the view that the U.S. government will be more likely to allocate funding or support towards the expansion of White Mesa, or do you think they would extend beyond the United States and actually look to potentially provide support on the development projects at Tola and Donald?
Yeah. Look, I think I think the US government and the first instance prefers to to to, to advance and fund uh projects or in the United States. Um, but you also have to get back to the realities of the United States with the exception of of of mountain paths. You know, there really aren't a lot of quality rear Earth deposits in the United States. I mean, you look at the monos we get from kimmore and Florida and Georgia, it's high and Heavies. So I think they prefer the United States, but they recognize they have to have a, a global footprint. I mean, you look at how they've reached out to Australia, and number of cases, um, certainly Canada and even into Africa. The US government is interested in securing, uh, reliable material scales. So that then they have some Geographic diversity. So, I mean, they prefer, but yet at the same time, the realities are, there are not a lot of Heavies in the United States of America. And
Less it comes really from the monazite. Um, and in the case for us, you have the Donald project in Australia which is high and heavy. So um, but but we think that the appetite is there from a number of different angles with the US government to help Finance projects globally and it could be floor, prices alone would be sufficient.
Your next question comes from the line of Justin Chen with SCP resource Finance, please go ahead.
Strategies coming together. Uh, just a few questions. One is on Astron and Donald, so just to confirm that the financial side of things in Q2.
Can I confirm that? So you, you will essentially make a payment if you both elect to go ahead with the project of 183, Aussie million and that will secure your 49%. And then that that amount is is payable towards the, your share of capex, or would your share of of capex for Donald be? In addition to that 183 million
No, no, the 183 million is, is really, um, our buy into the project, and the the equity portion is really what is geared around. Um, you know, both parties will have to, to pay their own, um, you know, debt portion, uh, per watt on their share, um, and any additional Equity that might be required to obtain financing. So. Um, but yeah, it's really our Buy in and Dave, I don't know if you want to add anything to that. Um,
No, no, that that that's right. The 183 would basically, cover the equity contributions of both parties and that would be our Buy in our Buy, in would be paying astronauts Equity contribution, and then we would pay our own and that would all total is 183. And as Mark says, if, if that if that increases at all due to financing needs, that would be be uh, paid per rata by, by the partnership. Yeah, so basically basically our our our
Lying on that project was about $60 or thereabouts.
Um, and and so far, I mean, with some of the pre-fit work and everything. I think we we've invested about 20 million dollars or something around that um, at this point in time. So um, yeah, we're we're pleased that we have that project and we have that project permitted, um, and it's at a good address in Australia.
And permitted.
Gotcha so that so it's just to to make sure I'm clear on this. Um so that 183 goes into let's say the the Donald project code does that go to Astron?
and then,
I'm just trying to calculate like what, what the balance to fund is.
Yeah, it goes. It goes into the joint venture.
Yeah, right in that 1, that 183 is available for both of you.
Yeah, the $183 million goes into expenditures by the joint venture in advancing the project.
And right, I see. So you could effectively, as a group, fund the remainder then.
Yes, absolutely.
Yep.
Oh, okay, thank you. That's, um, Mark said this is Australian dollars. Yeah.
They're a lot smaller than the U.S. dollars.
Yeah, okay. Gotcha. And then, can you maybe talk us towards
Sort of what the next steps are for confirming FID there. Now that it's got its permits, is it just investigating offtake? There was a revised capital estimate.
I think uh, less than a year ago. I'm just curious. What what the next steps are?
Yeah, it's it's really focused on bankable off, takes both for the heavy mineral Sands and, um, The Rare Earth Products is really what it boils down to. And um, you know, we're, we're looking at that in relationship to the capital operating costs, you know, the Returns on the project. So, um, it that's really the, the, the the bid is, is getting the bankable off takes a securing financing in, in, in, you know, getting the position. The, the project ready to go into construction. Um, the project is, um, you know, ready to go into construction right now. If you had all that done, you could go into construction quite quickly. Um, but you know, it's the, it's not over until you get all the money to do the project. It it is, um, relative to the rare earth world, you know, it's a pretty small strike rate. I mean, if you look at in US dollars is around $300 million for the project for the combined both parties in terms of
terms of, you know, so
Yeah, watch this space um Justin but but we we really got to get the the bankable off takes and and the be in a position to get the financing to make the fit decision.
Gotcha, and maybe just a bit more color on that. So is it, is it off-takes more on the um,
On the, on the titanium, and ziron products or, um, on the, on the rare side of things or both.
Both.
Okay, gotcha.
Um,
On putting out an updated either reserve or mine plan, um, to help the market kind of start pricing this into the long-term outlook for your company.
Yeah, we we we've got SLR working on that right now. Um, I I don't know. Dave, have you heard the exact timeline on that? I mean they've got some stuff that's still into the Laboratories for analysis and they're pulling together. Um, you know what's interesting about the pinion plane and and Justin, you'll appreciate this is that, you know, the the what we what we think we're seeing is that when the original modeling was done uh the model constrained on high grades and the area influence of the high grades to be conservative. And what we've seen or what we think we've seen is that we didn't need to constrain it because those High grades actually work could be projected out for quite a large distance. So that's why we're getting this significant increase. Um, also even though we've done Drilling in the Juniper Zone as I mentioned over half of that Juniper Zone still has a whole pile of drilling to do. So I think what you're going to see fairly soon.
Probably I'm guessing by the end of the year, uh, an update on the resource and then there's going to be this geological potential to expand this further. And what you also seeing is that when you look at some of these grades like 5% 7%, you can fit a lot of uranium in a very small space. Like you see in Athabasca effectively
In my opinion, this is a miniature Athabasca mine with the grades that we're seeing. It doesn't take a lot of space to hide a lot of pounds if it's very high grade.
Yeah, absolutely. Yeah. It's um,
Yeah, it's doing great. Just can't wait for, um, I guess, more data to.
It's just pricing into the long term.
Um, and then just one on I, I guess, totally. And maybe the rare earth master plan here. Um, in terms of, I guess, pressing the button on the Phase 2 expansion for White Mesa.
Do you imagine that? You would.
That would be around the same time as F on I.
You were mentioning you could make that decision next year.
Yeah, I mean, right now, um, our main focus is on the projects that we have that are fully permitted and can go forward right now. So when you have Donald, you have the ability to receive material from Kimori and from others. And then you look at where we are with the White Mesa Mill. Now, we still have to submit our Phase 2 documentation to the state of Utah for final approval. Um, I don't believe that we may pull the trigger on Phase 2 even without all the permits in place on Toliara. Now, in a perfect world, we'd like to have both, right? But, um, it takes time and how we phase things.
It's still a work in progress, Justin, but um,
You know, we want to have the larger scale. We want to have the separate plant and the ability, um, to process both uranium ores unimpeded and rare earth ores unimpeded as soon as we can. And, you know, we'll just be evaluating how best to do that. So, um, just quickly, the Pinion Plain resource update should be December. Not to change topics, but we see the...
The expansion of the white Mason Mill. Um, in the United States is something very attractive, um, for whether it be the the government or or even private parties, uh, because of the ability to produce monocyte and uh, you know, we'll just see how that unfolds with the various other projects we have
Your next question.
Comes from the line of Zach, Parry with Robertson Stevens. Please go ahead.
Hey Mark, uh, congratulations to the Denver quarter. Um
People have really kind of.
Poked at the, uh, financing of rare earths. Obviously, this is a big geopolitical game, uh, as I've always said. I hate to have you try to read the mind of the government, but does the U.S. government understand both the structure of your supply chain and what you need to do?
And if you get to scale, your superior volume and cost structure, because if so,
Uh, you would think that you guys would be a very high priority after they sort of walked in with, uh, saving MP.
Processing, the engineers. I mean, they have some of that but, um, and you know, you just have to keep telling your story and showing that you can advance, um, your story. And uh, I think though it is resonating with them that um, there are a lot of stories out there but there really are only a handful of legitimate stories. I mean, a lot of them are more hopes and wishes and we can do it if you give us money stories, um, and and we're not that. Um, so I think they that they're they're they're they're getting, uh, more up to speed with how this market interrelates and the importance of each step. And I think they're also aware that they can't have, you know, investment in a single project that they have to have multiple projects because as you know, Zach in a lot of projects will fail or, or underproduce, uh, or may never produce.
So, um, I think they're getting up to speed. Um, but but what, what's, what's, what's remarkable is, is how Keen they are to reshore a lot of these capabilities and, and get world scale molecules and, and not just world scale molecules for the defense department in the US. But, you know, countries like Canada and the European Union. Um, even places like Japan. Um, they need molecules too and you don't have those Minds in, uh, Europe. And you don't have those Minds in Japan. So, uh, it's kind of a
Global issue. So I I think they're getting it more, um, but it's been a learning process and it's been a learning process for a lot of people.
Got it. And could your timelines be sped up? If the government, you know, puts push fast forward on their support?
Um, look, money can speed up a lot of things.
Um, but you know it it but but you also have to look at the practicalities too because you, you have things like, you know, how much can you speed up the permitting? Um, how much can you speed up the construction and, you know, long lead times and things like that? So, yes, it can be sped up. The question is how much, um, and um, but but what, what's interesting and unique for us is, for example, we have the phase 1, it's already constructed,
And we have Donald permitted. Um, so we can speed up at least to the capacity of phase 1 for the lights and potentially the Heavies quicker than others can. So, um, um, that's a unique position that energy Fields can do uranium, it can do the rare, Earths at the phase 1 scale,
And or in the future at the phase 2 scale. So we have stepping stones that others don't have.
Got it. Thanks. And then, uh, real quick on uranium. Uh, congrats on proving Incredible cost structure.
Uh, now the uranium market has sort of been in a Mexican standoff for I feel like a couple of years in terms of...
Um, pricing the, you know, pricing has gone up a lot. Uh, but we haven't seen true Contracting at what you would expect high prices needed to create, uh increased Supply. And obviously, I think that's what you're waiting for. What? Actually, finally breaks.
That standoff where you actually see. PRI contract pricing come in at volume at a price that we might think clear clears the market.
I think it's just the beginning, but I think that the utilities are starting to see where a number of new producers are are failing to deliver on time.
And we're struggling. And we've seen that, um, starting to emerge over the last year. A lot of the discussions we have with utilities is that they need more product. In our case, they flexed up on some of our contracts because they're short of material from new producers that are not producing. So, I mean, there is a pretty active market right now. We're getting quite a few RFPs.
Upcoming in and I and and again the term prices are 88 or even higher. Um so you do have a higher term price and at the spot which I think reflects that the utilities believe that the price is going to be higher um and the ceilings are going higher and the floors are coming up.
So I think all the pieces are in place to...
You know, we see these improvements in the spot price and the term price going forward.
Hi. Um, just a couple, um, you know, um, I just wonder. I apologize if you touched on this, um, earlier. But, um, could you just talk a little bit about...
Um, you know, there's still all the excitement with the smrs, um, versus the, uh, different projects for her restarting, um, existing Legacy reactors. And could you just talk a little bit about sort of a reality check on, on the Legacy versus the, the smrs, and their sort of, uh, their impact on on uranium demand? Because I I feel like they tend to get sort of discussed as a a little bit lumped together. So um, any thoughts there would be great.
And I think thats surprising people, because youre seeing even reactors in the United States that are being restarted.
Yeah, no. Um, look, the quickest way to increase demand is to restart a reactor that's already built.
When you look at Japan, Japan shut down all of these reactors after Fukushima and their restarting them.
So the demand is going to increase quicker with restarts because.
Given our six months or a year or two years, they can restart and they have to be reloaded and youll see that where they have to go out and buy uranium.
<unk> are ways off quite a ways off and so.
The disconnect is that it is just that.
Existing it's really no different if you have a permitted meal you can do something with it if you don't have a permitted bill you can so.
When you look at from the mining there.
<unk> side of things so yeah, I see the restarts as immediate demand and yet you can bank on that particularly when you see big Tech companies, putting the money into the restarts and utilities signing an agreement.
That's the way to get the demand up quicker.
And in <unk>, our work in progress and then looking out probably at least 2030 ish or so.
Before that starts to become.
A real factor.
But it takes time for all of these things so it doesn't matter, if you're mining or youre doing nuclear power plants. It takes a lot of time to get the permits to build them.
And.
But I'm really encouraged with what I'm seeing with restarts.
Great Thanks and.
Yes.
Clarify that for me so.
Is there is there a time horizon and I know I'm I'm, absolutely predict the future which is already factored in.
Do you have a sense of a threshold where.
Perhaps the <unk>.
Some of that was going to ask I E. They because their plans become more concrete.
Where the market starts to sort of them back.
Backfill a bed and start thinking about you know what what premium.
What what's your time premiums.
We should be built into it.
The price to sort of make sure that you know.
Wherever the demands coming from that any given party you know can lock into pie and not be the last one trying to crowd through the door and any any sense of and advances.
We have a lot going live that you could see the pricing ripple into the market.
Yeah, well I think I think that the best way to get a handle on that as you go to the trade tack or UX.
We have forecasted our you know a lot more scientific than I can give you over the phone or on this call.
I do see this that I and after being in the business for coming up on 50 years.
I don't know, how we're going to fill this demand with new uranium projects.
And I think when you look at existing projects that are becoming mined out it has to be replaced.
Whether it is anywhere around the world.
If you start to double the demand for nuclear fuel products, you're going to have to double the mining of new uranium and people havent explored for uranium for decades in any material way and I don't know where its going to come so I think.
All of these pieces, including.
The restarts <unk>, but also the build rate in China.
I don't know where theyre going to get all their fuel.
Okay.
Your next question comes from the line of Gary Steele. Please go ahead.
Good morning, Mark Hope you hear me all right.
I do Gary Thanks for calling in.
Absolutely absolutely exciting quarter beyond belief.
After having watched.
The company for many years wanted treated.
Couple of questions with followed the press some excitement around the ceramic coating and ranchers to Wyoming and of course Mountain pass.
There anything you can share or would be at liberty to share we're starting.
Any synergies or opportunities with those two projects.
Yeah.
Geez I have to think about that Gary.
I think I think again, we go back to this differentiator being monocyte monocytes and very high grade.
Good distributions at <unk> and heavies.
And the economics.
So I mean, our strategy is different than theirs and and.
For me as a mining engineer greatest always keen when you're processing things.
So, yes, I mean, I don't really know the synergies between the groups other than we will have probably likely more heavies and any of them.
With the projects we have in the monocyte deposits we have.
But everybody in the aerospace is getting attention right now.
And I do think that the realities of the cost of production and the grade of these deposits.
He is really going to.
Something thats important in the scheme in the economics going forward and we know with what we've done thus far in the monocyte that we've received and the project. We have that we're going to be a low cost producer. So we're focusing on being a low cost producer and the others will have to do their studies and make sure they can process and do.
The things that they say theyre going to do.
Sure.
Another totally separate question.
I assume youre uranium runs in your rare Earth runs.
Separately, and then farther clean out and turnaround between runs.
Is that accurate.
Yeah.
We're trying to be flexible here right now it just conceptually.
We talked at 2 million pounds per year or thereabouts, that's about eight months or on a nine month run.
And we can have a window between that run your aim run in the next year and run in a rare earth runs so, but we're going to be flexible because we can generate really exceptional margins on the uranium we've got to have enough feed to justify a run but it does take time to switch over I mean, the mill you don't do.
Flip the switch it probably takes a month to two <unk>.
A retrofit and take certain equipment out of the tanks and whatnot.
About a month each direction. So we wanted to minimalize that as much as possible, but we really want to make sure that we're really focused on our best margins.
For our shareholders going forward, but we have the ability to do both but it isn't a switch until we have phase III phase.
Phase II will be completely separate and they can both run independently and then we will not have to do that.
So phase III.
New chime into the circuit.
It can run both materials independently from one another.
Correct completely independent.
And Gary you know this the mill has not been ran at capacity for a lot of years.
And I think that our best years are ahead of us because I think we are going to need to run both our facilities.
At or near capacity going forward.
Okay.
Including the phase II plant.
Okay.
And your final question comes from the line of Erin <unk> with Alta. Please go ahead.
Hey, Mark.
Thanks for taking my call and congrats.
Congrats on all the progress this quarter.
I'm glad you brought up the benchmark ex China pricing.
Really exciting and something that I've been looking at too.
I was just wondering if you could share how those prices and how those changes have impacted your off take conversations.
Well the benchmark prices came out.
Week ago, or so so it's it's.
Recent okay, but what's interesting I did get a text message. This morning from another forecaster and said.
They think they're low okay.
They are actually higher.
No I haven't verified that so I mean, I think it kind of goes back to this whole story on these floor prices that people are realizing.
You got to pay more if you're going to compete with China.
And I have to admit it surprised me when you had.
350% or.
With this first publication so.
I mean, it's certainly not going to hurt them.
And we think that.
This whole concept you have to pay more is a reality.
And I think thats, gaining traction I think DNP deal.
Yeah.
Proves that the government thinks you have to pay more.
And let's see where it goes but.
No.
Australia government talking about floor prices I think everybody is realizing that there's got to be a different market otherwise you are truly not independent.
Great. Thank you.
Okay.
Okay.
I just want to thank you all for calling in for watching the webcast. We very much appreciate your participation.
Just want to remind and let everybody know that our management team will be attending several upcoming industry and investor conferences, I'm, just going to run through a couple of them very quickly.
<unk> 2025 natural resources conference Entercom Denver.
2025, global uranium symposium the World Nuclear Symposium 50.
Jefferies Industrials.
1025, the HC Wainwright, 27th annual Global investment conference that paint Institute critical minerals symposium.
Uranium summit and the power at BNP Paribas. So thank you again, and we'll try and get all of that information uploaded onto our website.
You can follow along and now.
Hmm.
Mark will just say a few closing words.
Yes again, thank you for those who joined.
I think that really the closing words I have is we've been playing a long game, we're not playing short games flash in the Pan.
Been focused on uranium for decades or at least the assets have but when we added the rare Earth. I mean, we started a journey about five years ago, we held to that there were criticisms from people that we shouldn't be getting into rare earth critical minerals.
It's interesting because a lot of them are calling me up now and saying Wow that was great.
Happy you did that so.
We are focused on continuing the journey to build a world significant cost competitive.
Critical minerals company that has 10 plus critical minerals that can be produced commercially and at scale and really I don't know anybody who has done that so it's been a unique strategy. We are starting to bear the fruits of that and even even with her uranium peers year to date, we've been the best producing.
Graham share this year year to date and even when you look back a year or even start looking back over five years, we have outperformed our peers in many cases in the uranium space, we're performing well in terms of our peers in the rare Earths space.
So this is not an accident, it's a strategy that we've been committed to and we will continue to be committed to so thank you very much.
Okay.
Thank you for participating in the energy fuels conference call. Please reach out to the company directly for any additional investment.
This concludes today's call you may now disconnect.
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Yeah.
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