Energy Fuels Advances Critical Minerals Strategy as Madagascar Government Lifts 5-Year Suspension on World-Class Heavy Mineral Sands Project

• Energy Fuels is building a critical mineral hub around its core uranium business, adding rare earths and heavy mineral sands
• The Madagascar government lifted a 5-year suspension on Energy Fuels' world-class Toliara heavy mineral sands project
• Toliara is a large, low-cost source of both heavy mineral sands and rare earths, with production expected by 2028
• Energy Fuels has uranium mines operating or restarting in the U.S. and a strong balance sheet to advance its projects
• The company is positioning to help the U.S. increase domestic uranium and critical mineral production at significant scale

Energy Fuels (NYSE: UUUU) is a leading U.S.-based uranium and critical mineral company. With a unique strategy to build a critical mineral hub anchored by its core uranium business, Energy Fuels is well-positioned to capitalize on the growing demand for clean energy and strategic materials. 

Toliara Project: A World-Class Asset 

A significant development for Energy Fuels is the lifting of a 5-year suspension on its Toliara heavy mineral sands project in Madagascar. Toliara is a world-class asset, with the potential to be a large, low-cost source of both heavy mineral sands and rare earth elements. Mark Chalmers, President and CEO of Energy Fuels, emphasized the importance of this project:

"This is massive and the market doesn't realize how big of a deal this is. It is known to be a world class, low cost, world scale heavy mineral sand project with millions of tons of monazite."

Energy Fuels acquired Toliara through its purchase of Australia-based Base Resources in October 2024. The lifting of the suspension, coupled with a memorandum of understanding detailing commercial terms, represents a major de-risking of the project. Energy Fuels plans to start the final investment decision process, which is expected to take about 14 months.

Construction could begin in early 2026, with production anticipated by 2028. Chalmers noted that "anyone who knows this project" will be excited about its significance to Energy Fuels' overall strategy.

Strong Uranium Portfolio 

While Energy Fuels is diversifying into critical minerals, it remains committed to its core uranium business. The company is the largest uranium producer in the United States, with several mines currently operating or restarting. These include the Pinyon Plain, La Sal, and Whirlwind mine expected to restart in spring 2025. Energy Fuels is also advancing permits for its Bullfrog and Roca Honda projects, demonstrating its dedication to expanding its uranium portfolio.

The White Mesa Mill, Energy Fuels' conventional uranium processing facility in Utah, is a key asset. It currently has about one million pounds of uranium in front of it, sourced from the company's mines, alternate feed materials, and opportunistic spot market purchases. This positions Energy Fuels to benefit from any upside in uranium prices while maintaining a competitive cost structure.

Interview with President & CEO, Mark Chalmers

Financial Strength Energy

Energy Fuels has a strong balance sheet, with $180 million in working capital and zero debt as of its last reporting period. This financial flexibility allows the company to advance its uranium and critical mineral projects without the need for immediate capital raises. Energy Fuels has already sold 450,000 pounds of uranium in 2024 at an average price of $84 per pound, with only 300,000 pounds committed for 2025, providing exposure to potential price increases.

Uranium Market Outlook 

The outlook for the uranium market remains positive, despite recent price volatility. Chalmers believes that current uranium prices in the high $70s per pound are sufficient for existing projects with paid-off capital costs. However, he notes that the market needs to consider a "fully-loaded" price that accounts for the costs of finding, permitting, building, and operating new projects. This suggests that uranium prices will need to rise to incentivize the development of new supply.

Chalmers also highlights the growing demand for uranium, driven by factors such as the increasing use of nuclear power, the growth of artificial intelligence and data centers, and the overall positive sentiment towards nuclear energy. While prices may fluctuate, the long-term fundamentals for uranium remain strong.

Critical Mineral Strategy 

Energy Fuels' diversification into rare earth elements and heavy mineral sands aligns with the increasing focus on critical minerals in the United States. The company aims to establish itself as a key player in the domestic supply chain for these strategic materials. By leveraging its existing assets, such as the White Mesa Mill, Energy Fuels is well-positioned to process and produce a range of critical minerals.

"We do more in one year than most people do in 10 years."

The Toliara project is a significant piece of this strategy, with the potential to be a large-scale source of both heavy mineral sands and rare earth elements. Energy Fuels is also exploring other sources of monazite, a rare earth-bearing mineral, to feed its growing rare earth business.

Government Support 

While Energy Fuels is not relying on government funding to advance its projects, the company recognizes the potential for government support given the strategic importance of uranium and critical minerals to U.S. energy and national security. Chalmers noted that Energy Fuels is not looking for small-scale funding, but rather significant investments in the billions of dollars to establish a robust domestic supply chain.

The company is positioning itself to be a key partner for the U.S. government in addressing the country's reliance on imports for critical minerals. Energy Fuels' ability to produce multiple critical elements at a large scale could attract substantial government support in the future.

With U.S. annual uranium consumption at 45 million pounds, Chalmers offers a sobering perspective on realistic production milestones, highlighting the significant gap between domestic supply and demand:

"To get up to about 5 million pounds of uranium is a big step for the sector in the United States. To get to 10 is a huge step. I mean, I hear people talking about 15 or 20 million pounds, that's a lot and that's not going to happen anytime in the foreseeable future. It's harder to mine now, a lot of these mines were torn down or mothballed, so they're going to take a lot of time to get back up and running. I think the first step for the United States is to get to that 5 million pounds, but our consumption is about 45 million pounds, so that's way short."

The Investment Thesis for Energy Fuels

• Diversified portfolio: Energy Fuels offers exposure to both uranium and critical minerals, providing multiple avenues for growth.
• World-class assets: The Toliara project in Madagascar is a large, low-cost source of heavy mineral sands and rare earths.
• U.S.-based production: Energy Fuels is the largest uranium producer in the U.S., with several operating and restarting mines.
• Strong balance sheet: With $180 million in working capital and no debt, Energy Fuels has the financial flexibility to advance its projects.
• Positive market outlook: The long-term fundamentals for uranium and critical minerals remain strong, driven by growing demand and strategic importance.
• Government support potential: As a key player in the U.S. critical mineral supply chain, Energy Fuels may attract significant government investment.
• Strategic positioning: Energy Fuels is well-positioned to help the U.S. increase domestic production of uranium and critical minerals at a large scale.

Macro Thematic Analysis

The investment thesis for uranium and critical minerals extends beyond simple supply-demand dynamics into a complex interplay of technical capabilities, funding strategies, and production realities. 

The industry faces significant human capital constraints, with Chalmers highlighting:

"There are fewer people that understand this business with the technical skills to really execute a successful project."

This expertise gap creates a natural barrier to entry that favors established operators with experienced teams and existing infrastructure.

The funding landscape is evolving beyond traditional capital markets. Companies are increasingly looking at diverse funding sources including government support (US, Australian), international institutions (World Bank), and industry partnerships (auto companies, metals/alloys manufacturers). This multi-channel funding approach could accelerate development of strategic projects while reducing reliance on any single capital source.

Current uranium prices in the high $70s present a divergent market where existing operations can operate profitably while new projects struggle with full capital loads. This dynamic could create a sustained period where established producers with paid-off infrastructure maintain significant advantages over new entrants.

The critical minerals sector's strategic importance is driving government interest, but companies need to present large-scale, comprehensive solutions rather than piecemeal projects. As Chalmers indicates, future government funding requests won't be for "$50 million or $100 million" but rather "with a B on it."

This suggests a shift toward transformative investments in domestic supply chains rather than incremental capacity additions.This evolving landscape favors companies with diversified portfolios, proven technical expertise, and the scale to attract significant strategic investment, while potentially challenging pure-play developers and those without existing production infrastructure.