Is Uranium the next commodity to move higher?

As Ur-Energy Inc. (NYSE American: URG | TSX: URE) looks to break through its $1.57 (C$1.99) high reached in February of this year it’s time to take another look at this company and Uranium in general. The Company announced some exciting news late last week – they received three approvals representing the final major permits required to begin construction of their Shirley Basin project. This is good news considering Ur-Energy is engaged in uranium mining, recovery and processing operations, as well as the exploration and development of uranium mineral properties.

The Shirley Basin project would be complementary to the existing Lost Creek project with its recently announced increase to nine licensed mine units and the licensed limit annual plant production of 2.2 million pounds U3O8 which includes wellfield production of up to 1.2 million pounds U3O8 and toll processing up to one million pounds U3O8. This gives the company the option of either building out a complete processing plant with drying facilities at Shirley Basin or a satellite plant with the ability to send loaded ion exchange resin to the Lost Creek Project for processing.

This all sounds great except for one thing. Ur-Energy isn’t actually producing very much Uranium at the moment and is selling even less. The Company is maintaining reduced production operations at Lost Creek while awaiting the implementation of the national uranium reserve and further positive developments in the uranium markets (in other words, higher prices). The positive here is that this has allowed Ur-Energy to make operating cost reductions while continuing to conduct preventative maintenance and optimize processes in preparation for ramp up to full production rates.

The story for Ur-Energy, and other Uranium producers is all about where prices are going, not where they currently are (that almost sounds like a Wayne Gretzky quote). The Uranium market is a little unusual in that historically very little Uranium is sold in the “spot” market. Most transactions are long term contracts for multi-year deals. This has created a strange anomaly over the last few years, whereby miners will actually go out and buy Uranium to fulfill those contracts rather than produce it themselves. Cameco is a great example of this if you dig into their activities. Along those lines, at the end of March 2021, Ur-Energy had 285,000 pounds of U3Oof inventory available to sell or fulfill contracts.

But where does that leave investors? Ur-Energy has an unrestricted cash position of US$15.8 million and approximately US$8.6 million in finished, ready-to-sell inventory in order to maintain and enhance operational readiness or for possible acquisitions and general working capital. The Company can quickly and easily ramp-up to full production at Lost Creek of 1,000,000 pounds per year within 6 months at an estimated capital cost of US$14 million. Assuming Uranium pricing warranted this ramp-up in the first place, Lost Creek can be further advanced to its fully licensed 1.2 million pounds per year and Shirley Basin can then be developed up to 1.0 million pounds per year, which should make investors pretty happy.

But what is going to drive that increase in Uranium prices higher than the $20-$30 per pound range it’s languished in for most of the last 5 years. For starters, the U.S. Department of Energy will be provided US$75 million to coordinate with and support the Office of Nuclear Energy in the development and implementation of a national uranium reserve program. The US Government also announced an extension and expansion of limitations on importation of Uranium from the Russian Federation. Another catalyst is the Biden Administration’s commitment to nuclear energy, calling nuclear an essential pillar to its clean energy mandate. Lastly, investment interest in the form of the recently announced Uranium Participation Corporation agreement with Sprott Asset Management to modernize its business structure and pursue a U.S. listing.

On the flip side, Cameco announced plans to restart production in April at its massive Cigar Lake uranium mine. Additionally, Kazatomprom the world’s largest producer of uranium, with production representing approximately 24% of global primary uranium production took a page out of OPEC’s book and announced 20% reductions through 2022. It’s not a reach to believe that if prices start to improve materially, both Cameco and Kazatomprom could ramp up production relatively quickly.

So as an investor, you need to make a decision on Uranium prices first and whether the current positive momentum can continue. If you decide you want Uranium exposure then Ur-Energy is a great leverage play to participate in the Uranium trade.




Ur-Energy’s Jeffrey Klenda on the Executive Order for Critical Minerals and the Impact of the Amended Russian Suspension Agreement on U.S. Uranium Producers

InvestorIntel’s Tracy Weslosky speaks with Jeffrey Klenda, Chairman, President, and CEO of Ur‐Energy Inc. (NYSE American: URG | TSX: URE), about President Trump’s Executive Order on Critical Minerals which called the reliance on critical minerals from foreign adversaries a national emergency. “It not only is a national emergency, I think it has been a national emergency for many years,” Jeffrey told InvestorIntel. “The reality is, of those 35 critical minerals, we are reliant for 31 of them to the tune of more than 50% of our consumption on foreign entities and for 14 of those critical minerals we are 100% dependent.”

Jeffrey went on to provide an update on the extended and amended version of the Russian Suspension Agreement. He explained how it helps the US uranium producers and also closes the loopholes in the agreement to stop Russia from flooding the US uranium market.

Jeffrey also commented on Kazatomprom, Cameco and the US presidential election. “We will see utilities coming back into the marketplace,” Jeffrey said. “We are thinking that will push prices higher before the end of the year and we stand ready. We have kept our operational staff in place, we are ready to ramp up at anytime. We can do it faster, at lower cost than anyone else”

To access the complete interview, click here

Disclaimer: Ur‐Energy Inc. is an advertorial member of InvestorIntel Corp.




Energy Fuels’ Mark Chalmers on production of rare earths from coal-based resources

InvestorIntel’s Tracy Weslosky speaks with Mark Chalmers, President, CEO and Director of Energy Fuels Inc. (NYSE American: UUUU | TSX: EFR), about Energy Fuels’ selection by the U.S. Department of Energy to develop design for the production of rare earths from coal-based resources.

In an InvestorIntel interview that can also be viewed on our InvestorIntel YouTube channel, Tracy and Mark discussed the selection of Energy Fuels, working with a team from Penn State, to develop a conceptual design for the commercial production of mixed rare earth oxides from coal-based resources in an environmentally benign fashion. “White Mesa Mill fits a unique role when it comes to dealing with rare earths feed.” Mark said.

In the interview, Mark commented on the announcement of the U.S. Department of Commerce’s deal to reduce Russian uranium imports over long-term. He also commented on how U.S. Presidential Election might affect the uranium industry. “Energy Fuels is in an excellent position when it comes to uranium, vanadium and rare earths to straddle whichever direction we need to go based on the changes in the government.” Mark added. Energy Fuels recently announced cash redemption of all outstanding debentures which will make the company debt-free on October 6, 2020. “Being debt free puts us in an outstanding position for any market for long time.” Mark said.

To watch the full interview, click here

To learn more about Energy Fuels Inc., click here

Disclaimer: Energy Fuels Inc. is an advertorial member of InvestorIntel Corp.




Lifton with Energy Fuels’ Moore on Trump and who has the largest uranium capacity in the US

“We have three production facilities. We have the White Mesa Mill in southeast Utah that is operating today…It has a capacity of producing 8 million pounds a year. We have an in-situ recovery (ISR) facility in Wyoming called the Nichols Ranch facility. It has a licensed capacity of 2 million pounds a year. Then we have Alta Mesa in-situ facility in South Texas which has produced about a million pounds per year. Nobody has as much capacity as we have…Uranium has not necessarily been on the government’s watchlist until recently. When President Trump came into office, he issued a critical minerals list and there was finally a recognition that uranium is critical not just for the US national security but also for US energy security. There were 35 minerals on that list including vanadium. We are one of the major producers of vanadium in the United States. So, two of the minerals on that list are produced by Energy Fuels.” States Curtis Moore, VP of Marketing and Corporate Development at Energy Fuels Inc. (NYSE American: UUUU | TSX: EFR), in an interview with InvestorIntel’s Jack Lifton.

Curtis went on to say that the US consumes about 47 million pounds of uranium per year but the country produced just 172,000 pounds of uranium last year which is not sufficient to supply even one nuclear reactor. Energy Fuels is the largest producer of uranium in the United States and has the only producing conventional uranium mill in the U.S. Curtis also said that the US imports close to 40% of its uranium from Kazakstan, Russia, and Uzbekistan which are geopolitical rivals of the country. Uranium price is about $25 per pound which below the cost of production of almost all of the US uranium producers. The heavily subsidized state-owned enterprises of Russia and China are flooding the market which is having an impact on the national security of the countries like the United States.

To access the complete interview, click here

Disclaimer: Energy Fuels Inc. is an advertorial member of InvestorIntel Corp.