Energy Fuels Inc. (TSX:EFR) shares have surged 29% since Capital Ideas wrote about the company 15 months ago
Capital Ideas Media | August 29, 2022 | SmallCapPower: On March 2, we wrote about uranium stocks as a way to play the global movement towards cleaner energy sources as both U.S. President Biden and Bill Gates have embraced the idea of increasing the use of nuclear energy.
(Originally published on Capital Ideas Media on May 18, 2021)
[Editor’s Note: Shares of Energy Fuels have surged 29% since Capital Ideas wrote about the company 15 months ago.]
One stock we mentioned at the time was Uranium Royalty Corp. (TSXV:URC), which has surged more than 35% since to its current price of $4.03.
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Energy Fuels Inc. (TSX:EFR) is also expected to benefit from greater nuclear energy use as it is the largest producer of uranium in the United States. It is also the biggest conventional producer of vanadium in that country.
A bipartisan 2021 Spending Bill, recently passed by the U.S. Congress and signed by the President, includes $75 million to create a strategic U.S. Uranium Reserve, which is good news for Energy Fuels.
But what could be even better news for its shareholders, though, is the Company’s move into rare earth production. Rare earths are critical metals and minerals used in various consumer products, such as smartphones, fluorescent and LED lights, and flat screen TVs, as well as being crucial for defense technologies and clean energy.
And with China controlling about 80% of the world’s rare earth supply, it is critical for the U.S. to have its own reliable domestic rare earth production.
Energy Fuels is looking at the potential to develop commercial rare earth elements (REE) separation, metals, alloys, and other downstream REE capabilities at the Company’s White Mesa Mill, with the goal of fully integrating a commercial US REE supply chain. To further its efforts, EFR was recently awarded an additional US$1.75 million by the US Department of Energy for its rare earth feasibility study.
Noble Capital Markets analysts, in a recent research report, said that while processing REE carbonate could generate “tens of millions” in cash flow (for Energy Fuels), separating REE elements could be even more profitable.
The analysts estimate $30 million being generated by Energy Fuels for producing 2,000-3,000 tonnes of REE carbonate as per the Company’s guidance, with that number growing to $75 million if EFR meets its targets of eventually processing 6,000 tonnes of REE carbonate.
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