Energy Fuels (NYSEMKT:UUUU, TSE:EFR) has agreed to sell a parcel of its non-core uranium assets to enCore Energy (CVE:EU) and Tigris Uranium.
The disposal includes unpatented mining claims and leases known as the Marquez and Nose Rock projects in New Mexico, the Moonshine project in Arizona, and the Cedar Mountain, Geitus, Blue Jay, and Marcy Look projects in Utah.
The agreement also allows enCore to process conventional uranium produced by the assets at Energy Fuels' White Mesa Mill in Blanding, Utah, under a toll milling agreement.
The sale is all part of Energy Fuels' continuing asset rationalization strategy that cuts holding, permitting, and corporate costs and allows it to focus on its higher quality uranium assets.
The uranium miner will receive US$329,960 in cash for the properties, plus 14.25mln enCore Energy shares, giving it a 19.9% stake in enlarged share capital of enCore, making it the company's largest shareholder.
Energy Fuels has nominated Paul Goranson to be its representative on the board of enCore Energy.
“His expertise and experience will be valuable to our acquisition and development strategy going forward," said William Sheriff, chairman of enCore.
"Additionally, the toll milling agreement and these acquisitions provide the company with several important conventional uranium projects as well as increasing its ISR (in-situ recovery) interests while achieving geographical and geopolitical diversification,” he added.
Energy Fuels said enCore will assume all liabilities on the disposed of properties, including all debts, obligations and environmental claims.
“I believe this deal makes good sense for both companies,” said Stephen Antony, president and chief executive of Energy Fuels.
“Energy Fuels is focusing on higher-grade, lower-cost and larger-scale uranium projects, while we continue to cut costs and monetize assets that do not fit our long-term business plans. We are also receiving shares of enCore Energy, a company that we believe has the ability to potentially unlock the value of the assets we are selling.
“enCore has a strong management and technical team with an excellent track-record of advancing projects in the US, and our ownership in enCore will provide our shareholders with a vehicle to realize the potential value of these assets,” he added.
Energy Fuels is America’s leading conventional uranium mining company, and Antony recently highlighted importance the metal will play in the development of nuclear energy in the US, as the company seeks to achieve energy independence.
Speaking to the Denver Post, Antony said: “The US has greatly benefited from a shale revolution that has yielded billions of barrels of oil and gas. This has brought enormous economic benefits to America and made our nation less dependent on foreign sources of energy; however, there is another key consideration: taking greater responsibility in providing cleaner energy to the world.
“I’m fully expecting the US government to lead by example by becoming more proactive in addressing air pollution and carbon emissions. This will help drive increased use of renewables, but it also must lead to the US recommitting to modern nuclear power in a big way.”