enCore Energy Reports Strong Q3 Uranium Extraction Gains & What Rising US ISR Output Means for Investors

• enCore Energy's Q3 2025 uranium extraction increased 11.4% quarter-over-quarter to 227,070 pounds, reinforcing operational momentum across its South Texas in-situ recovery (ISR) wellfields.
• The company demonstrated resilient unit economics, delivering U₃O₈ at a Q3 cost of $38.35 per pound against average realized prices of $68.28 per pound, supporting widening margins as production scales.
• As of September 30, 2025, enCore reported $100.3 million in cash, $119.7 million in working capital, and 287,089 pounds of inventory, providing non-dilutive flexibility to advance its project pipeline.
• The September 2025 inclusion of the Dewey Burdock Project into the federal FAST-41 permitting framework signals accelerated timelines for US domestic uranium development, representing an important policy inflection point for investors.
• Rising extraction rates, expanding wellfields, and increased processing utilization at Alta Mesa and Rosita highlight enCore's emerging role in reshaping US 

Uranium Markets, US Energy Policy & the Significance of Domestic ISR Output

The global uranium market operates under structural supply constraints that have persisted through multiple commodity cycles. Multi-year permitting timelines, milling bottlenecks, and geopolitical fragmentation continue to limit production growth even as nuclear energy capacity expands worldwide. For the United States, this supply challenge presents both strategic vulnerabilities and investment opportunities.

Why US Uranium Supply Matters in 2025–2026

The United States operates the world's largest commercial nuclear fleet, yet domestic production has historically operated near zero. This dependency on foreign sources creates exposure to supply chain disruption at a time when energy security has become a central priority for policymakers and utilities alike. According to the Energy Information Administration, Russia, Kazakhstan, and Uzbekistan collectively account for 44% of US uranium imports, a concentration that carries heightened risk in an environment defined by sanctions, trade restrictions, and defense-oriented energy policy.

The passage of the Nuclear Fuel Supply Act, which allocated $1.6 billion to strengthen domestic uranium production, and the ban on Russian enriched uranium imports signal a fundamental shift in how the US government views nuclear fuel security. Utilities are seeking long-term contracts with domestic suppliers to reduce foreign dependency, creating both demand visibility and pricing support for US-based producers.

Positioning enCore Within the Policy Shift

enCore Energy's Q3 results arrive at this inflection point, demonstrating that domestic uranium production capacity is not merely aspirational but operational and scaling. ISR technology offers lower capital expenditure requirements, faster development timelines, and a smaller environmental footprint compared to conventional underground mining. These attributes align with federal and state energy priorities while providing investors with accelerated production visibility.

The company's operational turnaround reflects deliberate strategic execution following management changes earlier in 2025. William M. Sheriff, Executive Chairman, addressed this transformation in a September 2025 interview, emphasizing the operational progress achieved:

"What we've done in the four months since then is actually implement the plan and actually overachieve what we'd expected to do."

Q3 Extraction Gains & Operational Momentum in South Texas

The South Texas uranium district has produced more than 80 million pounds historically and, according to a November 2015 US Geological Survey assessment, contains an estimated 220 million pounds of additional potential. enCore's operations in this region are concentrated at the Alta Mesa and Rosita processing facilities, supported by multiple satellite wellfields that feed centralized processing capacity.

Extraction Growth as a Signal of Wellfield Performance

enCore extracted 227,070 pounds of U₃O₈ during Q3 2025, representing an 11.4% increase compared to Q2 2025. This sequential growth reflects improving wellfield efficiency as ISR operations mature through their recovery curves. ISR extraction relies on maintaining optimal injection and production balance while managing aquifer transmissivity, factors that improve as operators refine well spacing, oxidant dosing, and extraction patterns.

Higher extraction throughput enhances cost absorption across central processing plants. Fixed costs associated with facility operations, regulatory compliance, and management infrastructure are distributed over a larger production base, improving unit economics. For enCore, which operates processing capacity exceeding current extraction rates, increased throughput directly translates to margin expansion.

The magnitude of enCore's production acceleration extends beyond quarter-over-quarter comparisons. In his September 2025 remarks, Sheriff quantified the transformation in daily production rates that underpins the Q3 results:

"Our production rate on a daily basis has gone, depending on what time frame you're measuring it against, from up 200% to up 300%. from up 200% to up 300%. It's just a matter of urgency at the matter of the day, and it's every day for us.”

Cost Structure, Margins & Production Economics

Understanding enCore's cost structure requires distinguishing between different production categories and the timing of cost recognition. The company's Q3 results demonstrate improving economics across multiple metrics relevant to institutional investors evaluating long-term margin sustainability.

Q3 Realized Margin Analysis

enCore realized an average selling price of $68.28 per pound during Q3 2025 against total production costs of $38.35 per pound. This margin represents meaningful expansion compared to Q2 2025, driven primarily by higher extraction volumes that improved fixed cost absorption and reduced reliance on higher-cost purchased pounds used to fulfill delivery obligations.

On a year-to-date basis through Q3 2025, enCore's average cost declined to $53.71 per pound compared to $97.91 per pound for the full year 2024. This 45% year-over-year cost reduction reflects the operational leverage inherent in ISR production as extraction volumes scale and the company transitions from development-stage economics to steady-state production.

ISR Cost Position on Global Curves

ISR economics compare favorably to conventional underground mining across multiple dimensions. According to preliminary economic assessments completed in late 2024, enCore's projected cash operating costs at Gas Hills, Wyoming of $15.51 per pound (December 31, 2024 effective date) and Dewey Burdock, South Dakota of $23.81 per pound (October 8, 2024 effective date) position these projects in the lower half of the global cost curve. Gas Hills demonstrates a pre-tax internal rate of return of 54.8% while Dewey Burdock projects a 39% pre-tax IRR, both assuming mid-$80 per pound uranium pricing.

Balance Sheet Strength & Liquidity for Growth Execution

enCore's financial position provides the operational flexibility required to advance multiple projects simultaneously without near-term dilution pressure.

Liquidity Position

As of September 30, 2025, enCore maintained $100.3 million in cash and cash equivalents with working capital of $119.7 million. This liquidity profile supports continued drilling programs, permitting advancement, wellfield development, and capacity expansion at existing processing facilities. The company also holds 287,089 pounds of uranium inventory valued at $38.27 per pound, representing deliverable products.

Capital Strategy & Dilution Management

enCore's capital structure includes a $115 million convertible note (5.5%, maturing August 2030) with a capped-call overlay that limits dilution exposure. The conversion price of approximately $4.52 per share establishes a threshold above which the capped-call structure reduces the dilutive impact of conversion, protecting existing shareholders while maintaining financing flexibility.

The company's liquidity through September 30, 2025 supports self-sustaining operations, allowing management to optimize decisions based on technical and economic merit rather than near-term cash constraints.

The financing transaction, completed prior to Q3 2025, demonstrated significant institutional demand. Sheriff discussed the successful capital raise and its strategic implications in September 2025:

"We did 115 million that was upsized from 75 and we were still significantly oversubscribed."

Permitting Tailwinds & the Strategic Significance of FAST-41 Inclusion

On September 2, 2025, enCore announced that the US Federal Permitting Improvement Steering Council approved the Dewey Burdock Project for inclusion in the FAST-41 program, representing a significant regulatory development with implications extending beyond this single project.

Federal Permitting Acceleration as a Market Catalyst

The Fixing America's Surface Transportation (FAST-41) Act established the Federal Permitting Improvement Steering Council to coordinate and accelerate environmental reviews and permitting decisions for major infrastructure projects. Projects accepted into FAST-41 benefit from coordinated interagency review, transparent timelines, and elevated oversight designed to reduce permitting delays without compromising environmental standards.

Dewey Burdock's inclusion marks a rare achievement for ISR uranium projects, which have historically faced lengthy permitting timelines. The Permitting Council's oversight creates accountability for federal agencies involved in the review process and establishes clear milestones that provide investors with greater visibility into permitting completion timelines.

Implications for US Uranium Strategy

The FAST-41 designation aligns with broader US government initiatives to strengthen domestic nuclear fuel supply chains. The Nuclear Fuel Supply Act's $1.6 billion allocation, national energy security priorities, and the ban on Russian enriched uranium imports collectively signal that uranium permitting will receive elevated priority within federal agencies.

Dewey Burdock carries additional permitting advantages stemming from its regulatory history. The Nuclear Regulatory Commission issued a source and byproduct materials license for the project in 2014, which is now under timely renewal. This existing regulatory footprint reduces permitting risk compared to greenfield projects without established agency records.

Dewey Burdock represents the first South Dakota ISR project to receive FAST-41 designation, providing enCore with a jurisdictional advantage as other developers face traditional permitting timelines.

Gas Hills, Alta Mesa Optimization & Tacubaya Exploration

enCore's project pipeline provides multiple pathways for production growth beyond current South Texas operations.

Gas Hills & Dewey Burdock Project Economics

The Gas Hills Project in Wyoming presents compelling economics with a pre-tax internal rate of return of 54.8% at $87per pound pricing, according to its December 31, 2024 preliminary economic assessment. Gas Hills contains infrastructure from historical production and benefits from Wyoming's established regulatory framework for uranium mining.

Dewey Burdock's October 8, 2024 preliminary economic assessment projects a pre-tax internal rate of return of 39%, supported by cash operating costs of $23.81 per pound. The project's measured and indicated resources of 10.95 million pounds provide multi-year production visibility once permitted.

Alta Mesa & Rosita Processing Capacity

As of Q3 2025, enCore operated two central processing plants in South Texas with total design capacity of 2.8 million pounds annually. The Alta Mesa facility was constructed with capacity of 1.5 million pounds annually plus 500,000 pounds from satellite ion exchange plants, while Rosita provides 800,000 pounds of annual capacity. Alta Mesa is currently configured to operate at 1 million pounds per year and is running at approximately 60% of that configuration, with accelerated drilling intended to increase capacity utilization.

Exploration & Development Activity

As of the end of Q2 2025, enCore maintained 24 drill rigs in operation with plans to increase to 30 rigs during Q3 to accelerate wellfield expansion. The company initiated a 200-hole exploration drilling program at Tacubaya in mid-October 2025, designed to define additional resources that will provide feed for South Texas processing facilities.

enCore's ability to execute its drilling acceleration depended on available technical talent and operational experience. Sheriff emphasized the importance of the company's technical workforce in his September 2025 interview:

"The one thing you can't fix is the shortage of talent, and at enCore, we've always said, I've been talking for a number of years now, I've always said that our biggest assets are people, our bench strength."

US Uranium Scarcity & enCore's Role

The intersection of supply constraints, policy support, and utility demand creates a strategic environment where domestic uranium producers carry scarcity value that extends beyond conventional commodity supply-demand fundamentals.

The United States requires approximately 48 million pounds of uranium annually for its commercial nuclear fleet, yet domestic production has contributed negligible supply for more than a decade. The resulting import dependency creates strategic vulnerabilities that policymakers and utilities are now actively working to address.

enCore's technical capabilities extend to fundamental expertise in ISR technology. Board member Dr. Dennis Stover co-invented the ISR process, providing the company with direct access to the technical knowledge base that underpins modern uranium recovery methods. The company's S-K 1300 compliant resource base of 30.94 million pounds measured and indicated plus 20.54 million pounds inferred provides multi-decade production potential at current extraction rates.

The Investment Thesis for enCore Energy

• Domestic Supply Priority: US energy security policy is accelerating demand for domestic uranium suppliers through direct government support, import restrictions, and utility contracting preferences, with enCore benefiting from operational production capacity rather than development-stage timelines.
• Strengthening Unit Economics: Rising extraction volumes and low-cost ISR operations support expanding margins, as demonstrated by the company's cost reduction from $97.91 per pound in 2024 to $53.71 per pound year-to-date through Q3 2025.
• Permitting Inflection Point: FAST-41 inclusion announced in September 2025 materially shortens the critical path to production at Dewey Burdock, providing cash flow visibility that supports valuation expansion.
• Resource Depth and Scale: S-K 1300 compliant resources totaling over 51 million pounds across South Texas, Wyoming, and South Dakota provide geographic diversification while maintaining operational focus in proven uranium districts.
• Balance Sheet Strength: Over $100 million in liquidity as of September 30, 2025 supports self-funded growth, reducing dilution risk relative to peers requiring ongoing capital raises.
• ISR Expertise: Leadership with direct ties to ISR invention reduces execution risk and optimizes technical outcomes across wellfield development, processing efficiency, and environmental management.
• Strategic Scarcity: With US utilities actively diversifying away from foreign supply, enCore's role as a domestic, scalable producer carries strategic value that extends beyond conventional commodity supply-demand dynamics.

What enCore's Q3 Results Signal for 2026 & Beyond

enCore Energy's Q3 performance demonstrates rising extraction rates, improving cost structures, and strengthening alignment with the policy, security, and utility contracting trends that define the current uranium market cycle. The 11.4% quarter-over-quarter production increase reflects wellfield optimization and operational execution, while the company's September 30, 2025 cash position of $100 million provides non-dilutive funding capacity.

The company's expanding wellfields, strengthened balance sheet, and fast-tracked project pipeline through FAST-41 inclusion position enCore as a strategically relevant uranium producer in the United States. For investors evaluating uranium exposure, enCore's significance extends beyond commodity price sensitivity to fundamental positioning within US energy security priorities. The company is transitioning from an emerging ISR operator into a cornerstone of the domestic nuclear fuel supply chain at a time when geopolitical and policy conditions are fundamentally reshaping where uranium capital flows.

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