The Energy Report
Source: Streetwise Reports 04/04/2019
This company expects to increase V2O5 output during the warmer months.
Energy Fuels Inc. (EFR:TSX; UUUU:NYSE.American) announced in a news release it is now producing a 99.6% vanadium pentoxide (V2O5), the highest purity ever in the history of the White Mesa mill in Utahand it is doing so at commercial rates, using new, innovative techniques.
“The company has successfully implemented this efficient, low-cost method of producing vanadium at the mill with little capital exposure,” the release noted.
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Energy Fuels is recovering about 150,000160,000 pounds (150160 Klb) of V2O5 per month. This could increase to about 220225 Klb during the warmer months, then drop back down when it becomes cold again. Accounting for seasonal impacts, average production is estimated to be about 160200 Klb per month on an annualized basis, all of it achieved without having to mine any ore.
The company is reaching its current number at a cost that is less than what it originally budgeted, thereby exceeding estimated margins. If production rates increase as anticipated and/or the vanadium price rises from its current $13.88 per pound, then margins would be even greater.
Energy Fuels is selling the vanadium it produces as ferrovanadium to end users in the steel industry. It is still trying to land opportunities to sell parts of it into specialty markets, such as in aerospace and chemicals.
Also notable about the company’s vanadium program is its flexibility. Energy Fuels can turn its vanadium production on and off in short order and at little to no cost.
In other news, Energy Fuels has advanced its vanadium test mining program at its La Sal and Pandora mines in the La Sal Complex. To date, the company mined about 5,200 tons of material resulting in average grades of about 1.60% V2O5 and 0.19% U3O8. Also during the test mining campaign, it refurbished both of the mines so they can be quickly transitioned into full production mode at the time when the company decides to restart production there.
Mark S. Chalmers, president and CEO of Energy Fuels, stated, “We are extremely pleased with the excellent results obtained thus far on our significant vanadium assets, creating substantial value for the Company. Our campaign to recover vanadium from pond solutions at the White Mesa Mill is going very well. Product purities are higher than expected, production costs are lower than expected, and vanadium prices remain at high levels. We also have the ability to adjust our vanadium production very easily in response to changing market conditions. This production readiness and flexibility is a key attribute when dealing with minor metals like vanadium. It allows us to be able to produce or conserve our vanadium, as we see fit, in response to market volatility.”
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( Companies Mentioned: EFR:TSX; UUUU:NYSE.American,