After acquiring Uranerz in June 2015, Energy Fuels (NYSE MKT:UUUU) (TSE:EFR) has started a fifth header house at its Nichols Ranch ISR property, increasing flow rates by 33% and total uranium production by 25% compared to the amount recorded before the new header house came online. Because the new header house is in its very early stage of development, Energy Fuels expects production to grow as flow rates and head-grade continue to increase.
The first four header houses at Nichols Ranch have yielded some 200,000 pounds of U3O8 in the period from April to December 2014, and 55,000 pounds of U3O8 during Q1-2015.
While production at these four header houses has peaked and is now in decline, production at the new header house is expected to continue to ramp-up during 2015.
Energy Fuels acquired the Nichols Ranch ISR Uranium Project in June 2015. This isthe newest uranium production facility in the United States located in Wyoming’s prolific Powder River Basin, which produced over half of all U.S. uranium in 2014.
"We are very pleased with the operational results currently being observed at the Nichols Ranch Project. At this time, our fifth header house and the associated wellfield, is on-budget, on-schedule, and well on its way to becoming a successful uranium producer for Energy Fuels. We are similarly optimistic about the future performance of the sixth header house we have planned for later this year,” said Energy Fuels’ president and CEO, Stephen P. Antony.
The Company added that construction of a sixth header house would start at Nichols Ranch in August 2015, along with approximately 60 associated wells, which should go into production in the fourth quarter of this year.
The delineation drilling for these new production and injection wells was already finished earlier in 2015.
In situ recovery (ISR) mining, an injected-solution approach that reverses the natural process that deposited uranium in the mineral, at Nichols Ranch started in April 2014 and finished FY-2014 with four header houses in operation, along with the associated injection and recovery wells.
“Through our recent acquisition of Uranerz, we believe we have enhanced the near-term uranium production potential and future scalability of Energy Fuels. We continue to see longer-term fundamental supply-demand imbalances in uranium markets and expect higher uranium prices ahead. Even now, uranium consumption exceeds primary mine supply, with the difference being covered through inventories – which are finite. As we continue to ramp-up production at Nichols Ranch, we believe Energy Fuels will be well-positioned to capture expected uranium price increases," added Antony.
Following the Company's acquisition of Uranerz Energy Corporation last month, Energy Fuels now has two uranium production centers, including ISR uranium production in Wyoming and conventional uranium production in Utah.
Indeed, it is now the only company with both ISR and conventional uranium production in the U.S., and one of only three publicly-traded companies in the World with current ISR and conventional uranium production, the others being Cameco and Areva.