Energy Fuels Inc (NYSEAMERICAN:UUUU) (TSE:EFR), the largest producer of uranium in the US, is leading the charge to warn the government about security threats to the nation’s supply chain and is primed to scale up domestic production, according to an editorial earlier this week from NetworkNewsWire (NNW).
The article, titled “America’s Supply Chains in Jeopardy”, argues that if the US fails to take action to support a domestic uranium sector, then 20% of the country’s electricity and 55% of its carbon-free electricity could “become hostage to malign foreign sources.”
Energy Fuels, for its part, has produced more than one-third of all US uranium over the past 15 years, and the company’s White Mesa Mill in Utah is licensed to produce more than 8 million pounds of uranium per year.
Elsewhere, the company operates a pair of in-situ - mining that relies on drilling boreholes - uranium recovery operations. Its Nicholas Ranch Plant in Wyoming and its Alta Mesa Plant in Texas have a combined capacity of 3.5 million pounds of uranium per year.
That level of capacity puts the company in pole position to scale up as domestic demand increases, which could be on the horizon, NNW wrote in the report. President Trump’s recently-announced fiscal 2021 budget request included $150 million per year over the next 10 years to create a strategic US uranium reserve.
In July, the administration ordered the creation of the US Nuclear Fuel Working Group to “examine the current state of domestic nuclear fuel production to reinvigorate the entire nuclear fuel supply chain, consistent with United States national security and nonproliferation goals.”
“In the coming years, uranium imports are expected to mainly come from Russian and Chinese sources whose state-owned companies flood the global market, drive free-market companies out of business and threaten national security,” NNW said. “The good news is that with new government initiatives in motion, America’s strategic uranium supply chain will be protected and free from foreign influence.”
The global uranium sector is concentrated and relatively small, particularly in the US, which has limited the number of companies ready to kick the tires on additional production right away.
“There are only limited opportunities to directly participate in proven producers. Energy Fuels is one of those proven uranium producers, with assets and capabilities that are truly unmatched in the country today,” the NNW report said.
Energy Fuels also leads the US in the production of vanadium, which is essential in the manufacturing of high-grade steel and holds promise in high-capacity batteries, it added.
Additionally, Energy Fuels announced this week plans to enter the rare earth element (REE) sector. The company believes the White Mesa Mill can play an important role in bringing the REE supply chain back to the US from China.
The Englewood, Colorado-based company has the cash to make a push, NNW said. As of December 31, the company has $17.7 million in cash and marketable securities, on top of $22.8 millions of immediately marketable inventory — namely 515,000 pounds of uranium and 1.6 million pounds of vanadium. In 2020, Energy Fuels has added another $19.1 million to its treasury, the editorial added.
Contact Andrew Kessel at [email protected]
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