Energy Fuels Inc.

Good morning. My name is Julie and I will be your conference operator today. At this time, I would like to welcome everyone to the Energy Fuels first quarter 2024 conference call. All lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a question and answer session. If you'd like to ask a question during this time, simply press star, then the number one on your telephone keypad. If you'd like to withdraw your question, please press star too. Thank you, Mr. Chalmers. You may begin your conference.

Thank you, Julie, and good morning from Denver, Colorado. This is Mark Chalmers, President and CEO of Energy Fuels, and I'm excited to discuss our Q1 results and the exceptional progress we are making on both the uranium and the rare earth fronts, and I'm extremely pleased and proud to discuss this with you today. Over the past several years we have been pursuing a very focused strategy on building a critical mineral company centered around uranium utilizing our uranium knowledge assets capability and expertise to a maximum unlike any other country or excuse me company i know in the entire world On the back of our U.S. leading uranium business, we are making extraordinary progress advancing our global critical mineral strategy on numerous fronts while remaining profitable. Few in the uranium industry can currently tout being profitable at all, let alone while building out a diversified critical mineral company, which we believe will be world significant in time. It is highly unique that Energy Fuels is doing more than many other companies in the uranium sector, while also advancing very quickly and efficiently both our rare earth and heavy mineral sand space business strategies, which I believe presents significant opportunity for our investors. Today, I want to remind you, you will be controlling your slides from your own computer. I will try to tell you when to move these forward. Also, there will be playbacks available on our website shortly after the presentation. So at the end of the presentation, there will be time for questions. And I am being joined by Dave Friedland, our Executive Vice President, Chief Legal Officer, Nate Bennett, our Chief Accounting Officer and Interim CFO, and Curtis Moore, our Senior VP of Marketing and Corporate Development, to assist me with any questions you might have. So, looking at this first slide, and I love this slide. This is taken down in San Juan County, not far from the White Mesa Mill, and the title, Clean Energy Starts with Us, and actually clean energy on steroids, because I believe energy fuels can do more for the energy transition than just about any company I know of because of our strategy. Next slide. I may be making some forward-looking statements during this presentation. Those are included in page two of the presentation. Next slide. Our business objective is simple, creating a profitable high-margin US critical mineral company that I don't believe anybody else out there is doing like us because there is no playbook centered around uranium, producing several of the advanced materials needed for the clean energy transition. When you look at this figure with the uranium and these other things that surround the uranium, they all have a common denominator. They contain uranium and radionuclides that we can recover the uranium profitably and also handle the residuals. For example, when we're processing uranium ores or rare earths, we solubilize a lot of things like some of the medical isotopes that we're advancing particularly things like radium 226 and 228 number of our mines contain vanadium and uranium and we can cover the the vanadium as part of recovering uranium the best rare earth elements include uranium and other radionuclides we can capitalize on and deal with heavy mineral sands historically have had legacy issues with monazite. And we can monetize the monazite as well as the heavy mineral sands themselves. And the monazite becomes a byproduct of heavy mineral sands. And then our long history of uranium recycling, recovering uranium that would be lost for disposal, and everything we do perfectly centered around ESG. we're very excited about that so next slide everything we do is a high value product line of recovering materials needed for the clean energy transition uranium we have been the largest producer of uranium since 2017 and produced two-thirds of the uranium produced in the united states if you look back 10 or 15 years, we produced approximately one-third of the uranium produced in the United States, with Cameco being the largest producer of uranium, so second only to Cameco. We're restarting, or we've restarted our uranium mines, and we're increasing and ramping that up right now, and I'll talk more about it in this presentation. The rare earths, critical elements used for the powerful electric magnets for EVs, wind generation, and other We are starting the commissioning of our SX plant, our phase one XX plant today. And I will be at the mill in a few hours time after this presentation. Heavy mineral sands that is expanding to provide us a source of low cost monazite at world scale, while also being able to capitalize on the titanium and zirconium minerals. Vanadium, we have the only conventional vanadium plant in the United States. We can restart that when we choose to, but we are currently mining uranium-vanadium ores. And the recycling, it's the reason the mill has stood the test of time of uranium and vanadium-bearing materials, and that promotes sustainable sourcing and reducing carbon emissions. And financial strength, I believe we have the strongest balance sheet of any of our peers out there.

And I'll talk about that more in just a second. Next slide. Q1 2024 financial highlights. Next slide. We are profitable.

Q1 2024, we're continuing our earnings. We had 3.64 million of net income, 2 cents a share, including 2 million of operating income driven by our uranium business and revenue. We sold 300,000 pounds of uranium for a gross profit of over $14 million. Our strong earnings, including last year with our net income, continues to fund the growth of our uranium business and rare earth production and heavy mineral sands strategies. Meanwhile, we're ramping up uranium production, as I discussed, and advancing the commercial rare earth separation capabilities as we speak.

Over 0.24 billion of liquidity at current commodity prices. The

Working capital for March 31st of 2024 was $222 million, made up of 55 million of cash and cash equivalents, 140 million of marketable securities, which include uranium stocks and interest-bearing securities, substantial inventories, 28 million of inventory, and 19 million of product inventory. When you adjust for current commodity prices, our product inventory goes up to about 40 million, which adds another 20 million of liquidity. Zero debt, and we have probably in excess of 1 billion worth of assets. We have nearly 400,000 pounds of Finnish uranium and 900,000 pounds of Finnish vanadium and 11 tons of Finnish high purity separated mixed rare earth carbonate. We also have nearly 500,000 pounds of U-308 as raw materials at the mill ready to be processed later this year. So we have substantial inventories of Finnish goods and raw materials. Next slide. Talk about some of our uranium highlights. Next slide. And many of you have seen these pictures before, but we're ramping up to 2 million pounds of uranium production in the short term, low-cost production with limited capital required. That's important, limited capital, mainly working capital. The White Mesa Mill there in the upper left-hand corner, currently commissioning phase one. As soon as that commissioning is complete, we are going to switch over the mill and start processing uranium for the next couple of years while we're securing other sources of monazite. Canyon Plain in the lower left has currently got about 30 miners and mining high-grade uranium ore right now. That is the highest grade uranium mine in the United States. We're also in pre-production at our ISR facility, Nichols Ranch, in Wyoming. And we also are mining at two of our mines in the LaSalle complex at LaSalle and Pandora. And the Beaver Shack is actually three mines. And we're mining uranium and vanadium ores as we speak. ramping up to 2 million pounds with limited capital and looking to the future from there. Next slide. So I've already talked about the uranium transactions of 300,000 pounds generated north of 25 million in revenue, an average uranium sales price of $84 a pound, resulting in the gross profit of 14 million plus at a margin of 56%. 200,000 pounds was under long-term utility contracts and an average price of 75.13 a pound. But we also sold 100,000 pounds on the spot market at an average price of nearly $103 per pound. Continue ramping up our uranium and vanadium mines, as I mentioned, both in Utah and Arizona. and Colorado with whirlwind in time and also Nichols Ranch, ramping it up to about 1.1 to 1.4 million pounds of newly mined ore. So this ore will be mined and stockpiled either at the mine site or at the White Mesa mill, ready for further processing later this year or into next year. Our guidance we've given out is finished goods in 2024 of between 150 000 to 500 000 pounds we hope to be at the high end of that depends on how much ore gets delivered to the mill and what gets processed at the mill into finished goods this year but we'll be building up those inventories for processing and remember we have about 400 000 pounds of inventory finished goods already And we'll continue to prepare Nichols Ranch, as I said, and Whirlwind. So when you combine our finished inventory and our raw materials, we have nearly 900,000 pounds either already finished or ready to be processed at the White Mesa Mill when we complete our commissioning of phase one. Next slide. Ramping up to the 2 million pounds of annual production by 2025 will be a combination of a number of our mines, including processing low-cost alternate feed materials and also potentially ore purchases from third parties with a buying schedule. Again, if you look over the past, energy fuels have produced about a third of the uranium produced in the United States, second to Cameco. And we plan to continue to be the very significant producer of uranium in the United States. We're looking at expanding our future uranium production with exploration delineation drilling, both at Nichols Ranch, underground delineation drilling at the Pinion Plain Mine, which, as I mentioned, is the highest grade underground mine. It's the highest grade uranium mine in the United States. We continue to advance the permits at Roca Honda, Sheep Mountain, and Bullfrogs. All significant projects have the potential of adding an additional 4 million pounds of uranium production per year in the coming years. For 2024 uranium cells, I already talked in detail about Q1, but for the remainder of 2024, we're going to continue to evaluate spot market sales opportunities. We still potentially have another 100,000 pounds under contract for this year, and we may potentially make a delivery on that, but we'll have to see if the utility wants to take delivery. So we will continue to use our existing inventory, our raw material that we have at the mill site, our alternate feed, and these ores that get transported to mill to capitalize on a strong uranium price as much as possible. Next slide.

Let's talk about the rare earth and heavy mineral sand highlights. Next slide. Excuse me.

The rare earth element production complements our uranium production because when we're processing monazite, we're recovering uranium. And that uranium is a lot of times, will be at very, very attractive cost structures, very low cost uranium, like our alternate feed and some of our uranium production that we have as our uranium projects. So the combination of that are very competitive. Uranium production costs like no other company because of the way we can produce uranium. We completed the phase one separation plant in Q1. And as I said, we're starting to commission the Essex unit today, and I'll be there. The cost of building out that separation plant was approximately $16 million. That is incredible. It was under budget by $7 to $9 million under budget, and most companies in the rare earth business could not even build a pilot plant for $16 million, and we have built a separation plant with capability up to 1000 tons per year of ndpr which in itself is world significant subject to receipt a sufficient monazite feed which we're in the process of doing and so again i'll talk more about that in a moment we also expect to produce between 25 to 35 tons of separated ndp oxide as we commission this circuit and then switch over and start producing uranium with white mason mill the white mason mill over time has never been held back because we were doing something like for in this case processing alternate feeds or even processing the rare earths we have plenty of capacity at the white mason mill to handle all the feed we have lined up for the immediate future but we are engineering a upsize phase two and phase three so we can have completely separate facilities in time so we have the full production capacity of all our infrastructure at all times for the processing of rare earths, uranium, and vanadium. So we plan to increase the capacity basically two times to up to 6,000 tons of NDPR oxide per year. And just for people's information, that is the quantity of NDPR that Linus produced last year. So world significant. We'll have our own separate crack and leach facility and the ability to separate disposium and terbium and other heavies in due course. The phase two and phase three separation circuits are still subject to final engineering design and receipt of all required permits.

Next slide.

This is a very unique slide, and it shows how we are advancing an innovative rare earth supply chain. Four years ago, all there would have been is a flag for White Mesa. So look at the progress we're making for a fully integrated rare earth business while we're doing this on the back of our uranium business. Advancing through mining, crack leach, separation with a view and advancing towards metal making and alloys. We've had our relationship with Chemours which we plan to continue to advance. We secured the Bahia project 100% We have agreement signed for the acquisition of base resources with the world-class Toliara project and also the Kualia project in Kenya. And we're advancing the agreements with ASTRON on the Donald project in Victoria.

Next slide.

This next slide is a bit busy, but it shows that we are building world-scale for monazite supplies while also building a very strong portfolio of heavy mineral sand projects globally. And it was not by accident. We searched the world high and low to find the best heavy mineral sand projects that had monazite, and we went after them. Look at the Bahia project with potential production in 2026, Donald in 26, Toliar potentially in 28 when it gets all agreements in place to go forward. And that, when you add up the potential of securing that monazite and the heavy mineral sand revenue, places us in an enviable position going forward. We're also very excited about the world-class Toliar project that's well-known in the world. And BASE, through the acquisition, has an outstanding project team and a history of profitable HMS uranium production. And many of these projects, the monazite was never even considered an asset. It was considered a waste stream. And we're able to capitalize on this like no other company I know of and recover the uranium output. in a very opportunistically and economic way at low-cost structures. We're also looking at purchasing additional monazite concentrates through offtake in time. Next slide. Just some preliminary rare earth economics. We expect to be globally competitive. I talked about the phase one separation plant of up to 1,000 tons of NDPR oxide per year at a $16 million investment. When we have completed a class four pre-feasibility study to increase the NDPR separation and crack and leach capacity at the mill, this is the standalone, at 30,000 tons of monazite per year. But if you go back to the previous slide, you will see that we're securing, in time, we believe, when we close all these agreements and get these projects up and running, up to 50,000 tons of monazite secured to our account. So the original Phase II pre-feasibility at 3,000 tons of NDPR per year showed a capital investment of about $350 million. and the cost of producing a kilogram of NDPR of around $30 per kilogram. And I want to mention that it really depends. The economics of the rare earth business and the separation and advancing integration of rare earth products really, in our case, depends on what the cost of securing the monazite is because we know we can be world competitive If we have low-cost sources of monazite, and folks, look at the program we're putting in place. We're building up our position to be and receive low-cost monazite and also have revenues from the HMNS business. So we're updating the PFS between 40,000 to 60,000 tons of monazite. It'll probably be on the upper end. to have the capability, as we get these projects online, to produce up to 6,000 tons of NDPR per year, which is the size of Linus. And just for information, Linus has a market cap of $4 billion, even in a period where rare earth prices have been low. And on top of that, have the ability to recover the DY and the TB in separated oxides per year. So this is exciting stuff. We are also doing pilot scale testing on recovery and separating out the DY and the TB right now. And again, that is one of the really exciting and powerful things that we can do all this work at our site at White Mesa when most companies have to go out to laboratories and wait in line for months. to do their testing. We can do it right now, real time. Next slide. So we'll talk briefly about vanadium medical isotope highlights. Next slide. So we're continuing to advance the potential recovery of radioisotopes from existing processing streams. I know I've mentioned this in the past that we have an R&D license that allows us to recover radium-226 We also expect to complete the engineering on a pilot facility to recover radium-226 for testing by end users later this year or during this year. Vanadium cells are basically on hold until vanadium prices increase, but we do have large inventories of vanadium, and we have the ability to recover vanadium out of our tailing solutions and also building up sources of future vanadium with the mining of our deposits at the la salle complex next slide so talk about recycling and commitment to community which is very important to us next slide we continue to be very proud of the san juan clean energy foundation that we set up a few years ago with our initial contribution of one million dollars into the foundation and an ongoing commitment to fund the foundation with 1% of the annual revenues from the White Mesa Mill. We've made grants of north of $300,000 to date, supporting existing and new programs in education, environment, health, wellness, economic development, and Native American priorities. And this is an outstanding program. If you haven't ever done so, you can go on the website, the San Juan County Clean Energy Foundation website, and look at the great things that we're doing with our stakeholders and in the community. The mill recycling programs are particularly recovering of uranium, which we will be doing this year, reduces carbon emissions, and the world's finite resources to be able to recycle them using the White Mesa Mill is incredible. And all this has been done at our state-of-the-art facilities and tailings facilities at the highest global standards out there. Next slide. Now, this is my last slide. And this is an exciting slide for a number of reasons. Because look at the things that we are doing and accomplishing. We're restarting the mill to have finished uranium production. Guidance was 150 to 500,000 pounds this year. But remember, we have inventory, and we plan to push that as hard as we can to capitalize on potential future spot sales. We have no further contract sales this year expected except for that potential 100,000 pounds with one of our customers. We're ramping up the ore production, as I indicated, at our existing mines. to that 1.1 to 1.4 million pounds per year rate. And that ore will be going to the mill to be ready to be processed. And matter of fact, some of it is going to the mill right now. So we're increasing to that 2 million pounds per year using a combination of our mines, alternate feed, and potential third party purchases of uranium with limited capital and doing it right now. with proven assets that we know what the cost structures are, and we know we can accomplish that because we've done it for decades. And also, at the same time, increasing our long-term production profile by up to an additional 4 million pounds per year through the projects that we have, mainly Sheep Mountain, Aroca Honda, and Bullfrog. Now, that's a lot just in the uranium space alone. and doing that while at the same time bolting on the rare earth elements in the heavy mineral sands with the commissioning of phase one, the increased, the engineering of phase two, phase three at 2X what we had planned, drilling at Bahia in Brazil, coming up with a resource later this year or early next year, and advancing the Donald project with Astron and acquisition of base resources, which also puts us in the heavy mineral sand in a big way and secures low-cost supplies of monazite at world scale while being profitable. We are busy folks, and some people don't understand what we're doing, but watch our advancements. We are not slowing down. So everything we do is focused on long-term sustainable profitability at Energy Fuels. We're not a promotion. We're doers, and we're making great progress, and I really appreciate our shareholders, and I appreciate and happy to talk to anybody else that wants to consider becoming a shareholder. We're always available to talk about the advancements of our company and our strategy. So I will complete the presentation at this time and now open the floor for any questions.

Thank you. Ladies and gentlemen, should you have a question, please press star 1. If you'd like to withdraw your question, please press star 2. One moment, please, for your first question. Your first question comes from Matthew Key from B. Riley. Please go ahead.

Good morning, and thank you for taking my questions. We also had a big announcement last week with the Russian enrichment ban passed in the Senate. At a high level, could you maybe provide some additional color on how you expect this to impact your business and the U.S. uranium production chain more broadly?

Well, I think it certainly shows bipartisan support for reshoring our uranium production capabilities and the priority being placed on having the integration in the uranium business. So, no, it's certainly a significant help, and I think it's going to take some time to get all this in place. I mean, we've got a lot of catch-up because it was a national priority looking back 20, 30 years ago. We've got a lot of catching up to do. So we plan to be ready and able to help fulfill uranium production in the United States right now, Curtis Moore is on the line. Curtis, do you have any other comments to that that you'd like to add?

Yeah, not so much. I mean, it's just, I think, firstly, it's wonderful that we're not going to be sending any more money to Russia through our nuclear industry. And yeah, no, it's, you know, U.S. utilities have been shifting off of Russian supply over the last several years, which is to their credit. I think this was a very important step, mainly to unleash some funding out there. I think $2.7 billion to help restore domestic nuclear fuel capabilities, which is just going to increase demand for our U-308 product here in the United States. So this was an extremely important move. And I think that energy fuels is probably in one of the better positions to take advantage.

Great. I appreciate that caller. And just one more for me. You've mentioned for several months now that bringing on Whirlwind and Nichols Ranch will bring you over 2 million pounds of mine production. I was wondering if you could potentially drill down into that number a little more. If I recall correctly, Nichols Ranch has a nameplate capacity of 2 million pounds kind of alone. So basically, if uranium pricing performs really well heading into 2025, do you have a kind of what's the optionality here to kind of, you know, push those assets further if you have it?

Well, I mean, we can, we can get to the 2 million pounds. When you start going above 2 million pounds, it's just a function of how much additional investment that you make with regard to things like satellites and additional well fields pushing these mines. So when I talk about this goal of getting to this first rung of about 2 million pounds, This is with limited capital, mainly working capital. So it's just a function of investment to push it past the $2 million in time. When we start talking about three, four million pounds of uranium production, we've got to start spending pretty substantial capital. I mean, I'm talking like increments of $100 million or so for about every million pounds or so, somewhere in that order. So the $2 million is really kind of a threshold with limited capital. And And, again, that will be made up of newly mined ore from our conventional mines, production from Nichols Ranch, alternate feed, and potential some third-party purchases. So it's approximate 2 million pounds. We can go above that. But to really go way higher, like to double that, we have to start making substantial capital investments to go higher.

Got it. Thank you. Super helpful, and best of luck moving forward.

Your next question comes from Joseph Rigor from Roth MKM. Please go ahead.

Hey, Mark. Thanks for taking my questions. First thing is on your inventories, you guys have a little under 400,000 pounds of uranium, a little under a million pounds of vanadium. What do you guys think about what level of you'd like to keep of those inventories or is it just a function of pricing that would allow you to sell that, you know, as an option into the market, um, you know, over the remainder of this year and maybe long-term. Yeah.

Well, Joe, um, what we're, what we're looking at is, as we said, we're, we're mining this, this, this newly mined ore, shipping it to the mill. we're going to look at how we can maximize these higher prices to maintain our profitability to the best of our ability. So next year, I mean, this year we have potentially another 100,000 pounds to put into some of our long-term contracts. Next year, we also have long-term contracts, but we certainly don't have all that uranium committed for this year, next year. So So, Joe, we're going to push it as hard as we can, but a lot of it may be just timing. And because we have such significant inventories coming to the mill, we may run down our inventories a bit just to get the best result for our shareholders as we go forward and really kind of quasi-self-fund ourselves, not quasi-self-fund us, but based on the back of the uranium business. So, Curtis, do you have any other comments from a uranium market perspective?

No, I don't think so. I think that hits it. There seems to be some really good things happening in uranium markets, and the price seems to be headed in the right direction. I think this Russian uranium ban and additional things happening out there bodes well for spot prices. So I think that inventory is going to be an important part of our plans going forward this year.

And then any comments on the vanadium market? What do you guys see in there?

It's been pretty soft, Joe. And, you know, we look at what's happening to the vanadium market. And when the price goes up, we sell some product. You know, it's an interesting – vanadium is an interesting one because it is very spiky. And so what we're doing is when we process vanadium and put it in the inventory – We'll just hold that until we see a spike in vanadium prices. So we have had some people reach out to us of interest for vanadium, for some of these vanadium flow batteries. And we're hopeful that we can get some long-term interest for purchasing that at prices higher than the current prices, I think is $5 or $6 a pound right now.

Yeah, and if I could add there, I mean, you know, vanadium prices, you know, we found it just to be closely tied to global economic forecasts. You know, the main use for vanadium is steel. And so when there's good economic forecasts, you know, for construction, for vehicles, for infrastructure, things like that, you'll see vanadium prices go up. When the outlook's a little bit more uncertain, like maybe it is right now, vanadium prices are weak. But again, we just see every three, four, five years, there's a spike in vanadium prices. It's very hard to time that, and so it's beneficial to carry inventory so you're ready for it. And then as you sell it into those strengthening markets, we have the ability to produce it pretty quickly. As we bring our LaSalle mines online, we're going to also be processing and producing vanadium. So I think it's just a good kind of option that we have that we can capitalize on every few years.

Okay, thanks. And then on the capital spending front, you spent about $7.3 million in the first quarter. What are you guys thinking for kind of the full year on the CapEx side?

A lot of that, Joe, is where we're capitalizing some of our uranium development and also we're capitalizing some of the uranium production that we haven't turned into finished goods yet. So, Nate, you're on, I think it's around, what, $40 million or something. Can you correct me with an estimate on what our capital spend looks like, including what we're capitalizing for production?

Yeah, no, that's exactly right. We should see a similar spend throughout the rest of the year, but ramping up to approximately the $40 billion throughout the year. But we have been capitalizing some of the development of our opinion playing mind and some of the other activities. So that's the activity that you're seeing.

Okay.

All right. Thanks for the guidance, guys.

I'll turn it over.

Your next question comes from Mike Heim from Noble Financial Markets. Please go ahead.

All right. Thanks. And the question was kind of partially answered with the question on inventory, but let me just re-ask it for confirmation it sounds to me like you kind of feel like you need to have more uranium inventory before we sign more long-term contracts is that the case or is it still the case that the utilities are still stuck on the trying to buy things on spot so um we don't think we i mean we we think that our inventory is all work in progress michael um you know as i said we're we're we're already

over mining on our current contract portfolio. So, you know, we still are looking at and considering additional long-term contracts. A number of the utilities like the fact that we can be in production sooner, faster without capital or significant capital and financing the capital right now. So we, yeah, we're not going to, I mean, we're just going to be opportunistic when it looks like we evaluate what inventory we have, what inventory is being produced at the mines, what alternate feed we have, and go from there. But we don't necessarily – I mean, we like to have some inventory just because it gives you a little breathing room if for some reason you have some sort of production disruption for a short period of time. But we're confident. We know our assets well. We know our ability to deliver from those assets well. And, you know, we're not going to have large inventories just to cover that.

Yeah, if I could jump in as well, Mark, real fast. Remember, most long-term contracts, you know, they don't have deliveries that start for a couple of years. And we're ramping up to producing, you know, around 2 million pounds of uranium per year. We have not, you know, secured contracts for anywhere near that at this point. So we still have significant uncovered contracts. future production to enter into long-term contracts. And we're certainly talking to utilities on that front.

How should we view the ramp-up of production? Is it kind of a steady scale or do things really jump when you hit a certain, what I want to say, a certain point, a certain achievement level?

Well, I think that the way you should look at it is that if we're saying we're mining, you know, 1.1 to 1.4 million pounds of newly mined ore. That will become steady state in time on average. And you add, you know, getting to that one and a half to two million pounds that Curtis talked to, that's going to happen all fairly quickly over the next year or so. And then depending as, you know, what the uranium pricing is doing as we're advancing these other projects, we'll just start kicking them in in time as well. So we want to and we like to have sort of a base load of long-term contracts to underpin our operations, but also like to be able to put product out in the market in an opportunistic way like we did in Q1. Okay.

All right. Thank you.

Ladies and gentlemen, as a reminder, if you would like to ask a question, press star 1. Your next question comes from Graham... Tanaka from Tanaka Capital Management. Please go ahead.

Congratulations on your progress so far. I'm wondering if you could give us a little bit of guidance of what your revenues could be should the uranium prices strengthen further, just to give us a range, sort of minimum, maximum, as to, you know, if, say, prices get to well over $100 a pound, etc., How much higher could you ramp faster? Could you ramp production sales and therefore revenues, perhaps giving us a range of revenue guidance for the full year? Thanks.

Yeah. Hey, Graham. Good to have you ask the question. Graham, as we said, we can get to, you know, that one and a half to two million pounds quite quickly. So, you know, depending on what uranium prices gives you an idea of the revenue range. When you look at sort of the blended price of our production costs and whatnot, I mean, you could kind of see that we had these significant margins. I think our basis was around $37 to $40 per pound. As we mine additional uranium from various sources and including our alternate feed, I'm just going to say a blended price of around $50-ish a pound or something as we are ramping this up. Um, but as we go past that 2 million, as I said, um, you know, you could, you can kind of assume that, uh, you know, to get to three, three and a half million pounds, we're gonna have to spend a hundred million dollars or so of capital investment. So, uh, to get beyond, um, say 3 million, two and a half or 3 million pounds per year, uh, we're going to need a few years to, to, to, to get beyond that. So I don't know if that, um, provides any flavor. Um, but. You know, that's just sort of the realities of the timing, getting all the permits in order, getting infrastructure. Now we have the infrastructure to get to that $2 million, $2 million plus a bit, but then it's going to take some more time to go beyond that.

Right. So I understand it will take time and some capital to go to $2 and a half, $3 million, but with your ability to ramp production, I'm just wondering in a faster ramp scenario on prices,

not a ramp but a higher prices if prices were to firm up what could your revenues be uh this year i'm just just trying to get a feeling from going from the first quarter to the rest of this year this year um well this year depending on how we sell um inventories and and and ramp up uh you know when we sold uh you know 300 000 the first quarter know i'm just going to speculate that it could be around 100 million dollars okay of revenues this year if if everything clicks together and it goes from there this year and and that would be kind of roughly at what average price range kind of just just well i already i gave some indication that you know we we carrying the uranium on our books a little north of 30 depends on the blended price but Just say in the order of that $40 to $50, somewhere in that order.

All right. $40 to $50 would be your cost per pound?

In that order.

Okay. So in other words, to get to $100 million, I'd have to do the math on how many million, how many thousand pounds. I'm just trying to figure out what the price would have to be to get revenues. Thanks.

Yeah. Well,

in in the order of a million million two pounds something in that order okay one to one point two million pounds and at a okay i got it so you okay now i understand that thank you and um uh on the on the rare earth um a lot of um a lot of what you do in terms of how fast you ramp that production is going to be a function of of capacity and i'm sorry i've caught of prices that you can realize. And I was wondering how much of a price increase you're going to need to see in the markets to really ramp up the rare earth production and sales. Thanks.

Yeah. Well, on the rare earth front, I mean, right now our focus is going to be on, you know, securing the molecules, which, you know, we think we're putting our foot on these projects that I mentioned. You know, it's going to take some development time. right now to get all that in place. Meanwhile, the uranium business is really hot and we can capitalize on that. And it also allows us time to get our phase two, phase three and ramp that up over the next two or three years. Graham, we think we're going to be world competitive and we're going to be low cost curve on the rare earth front because of the strategy that we're executing. So, I mean, really to look at material rare earth production, You'd be looking at 26, 27, 28 out in that timeframe in terms of being able to fully capitalize and do the value add that we plan to do at the White Mesa Mill. But when you add up the scale of what we're talking about, you can see that it is world material compared to any other company that you added up to, including China.

Congratulations, by the way, on lining up so much supply of Monazite products. Pretty quickly. That was great. So getting back to uranium, what kind of funding might be available for you from the U.S. legislation? I'm not quite sure what the spending of a couple billion dollars by the U.S. government in the industry infrastructure means. Does that mean low-cost loans possibly for energy fuels or grants or what? Thanks.

Curtis, I'll let you handle that. Yeah, no problem.

Yeah.

Hey, Graham, this is Curtis Moore again. So most, if not all of that money is for domestic conversion and enrichment capacity, not for mining. However, there's currently a big bottleneck in conversion with Russia essentially being kicked out of the Western market. And so that actually limits the ability to of conversion facilities to take our material. So you've seen things like conversion prices are up like 10, 12x or something like that over the last couple years, and enrichment prices are up a similar amount. But you've seen uranium prices, I mean, they're strong, but they're only up, say, 3x or maybe, you know, maybe 4x over the last five years. And so by increasing conversion capacity, that will increase the demand, or at least the amount of U-308 that they can take from guys like us, from Western producers. So That's what that money is mainly for, but we think it's going to have a big impact on uranium prices just because it's going to increase demand for our material because of that de-bottlenecking of the conversion function, if that makes sense.

Great. Thank you very much. Thanks, and good luck. Thanks.

Thank you.

Thank you, Graham.

And there are no further questions at this time. I will turn the call back over to Mark for closing remarks.

Well, first of all, thank you for those who joined the conference call and for those questions. Again, I understand that our strategy is different from others in the fact we're building this diversified critical mineral hub centered around uranium. And there is no playbook. There is no playbook. Nobody has done this before. And that makes it difficult for some people to understand what we're doing and But again, if you go back to that last slide showing our focus and guidance on uranium and rare earths, and you look at our actions, you look at our actions where we're producing uranium, we're advancing our ability to produce and expand that in time. And then you look on the rare earths front. I mean, when you look at those three projects that we either have secured or in the process of securing or trying to get all the final agreements and close these opportunities, I hope that provides people with an idea of the scale we are talking about. It is significant. It is significant scale. And right now, we still get valued as a uranium producer. And in fact, probably penalized because uranium producer while building out this rare earth supply chain at scale. world-class scale and what we believe will be low, low-cost structures because of the unique attributes that we bring to the table and the types of deposits that we're out there looking to secure. So all I can say is that energy fuels, I believe, and I might be a little biased, and I go back to page two of a forward-looking statement, is an outstanding uranium investment and rare earth investment, but you cannot compare us to just the rare earth business. or just the uranium business. You cannot compare us. We really don't have a peer group. But if you believe in the energy transition and the focus on reducing carbon emissions, look at what we do. When we tell people we're going to do something, we do it. That is how we operate. We're not promoters. Mining uranium is difficult. It's very difficult. I've been mining uranium for 48 years. We know how to do this. These assets are proven. And on the other side, we're securing these feeds through a very focused strategic way. We're looking at high quality acquisitions. And the base acquisition is a perfect example of the type of assets we're trying to secure. that are world-class, long-term, multi-decade projects that can help with that diversification at scale, again, over the long term. And having that diversified cash flow creates other opportunities over time. So, I mean, look at the fact that in four years, as we build our uranium production, And at the same time, look at the speed that we're operating and advancing the rare earth. I think it is absolutely extraordinary. And that's what we're focused on. We're not trying to be status quo. We're not trying to repeat what everybody else is doing in your aim space. We're trying to be a standout and look for extraordinary opportunities to build a world material critical mineral hub. So thank you very much. Look forward with future updates. But we are moving fast, and we have the balance sheet, we have the team, and we're acquiring the assets, and we have a very significant asset base to build a very significant company going forward. Have a great day.

Ladies and gentlemen, this concludes today's conference call. You may now disconnect. Thank you.