Energy Fuels announces agreement for acquisition of Base Resources

Energy Fuels announced that it has executed a definitive Scheme Implementation Deed with Base Resources Limited, pursuant to which Energy Fuels has agreed to acquire 100% of the issued shares of Base Resources in consideration for 0.0260 Energy Fuels common shares and A$0.065 in cash, payable by way of a special dividend by Base Resources to its shareholders for each Base Resources ordinary share held, for a total equity value of approximately A$375M. The transaction will be effected by way of a scheme of arrangement under Australia’s Corporations Act. Mark Chalmers, President and CEO of Energy Fuels stated: “The acquisition of Base Resources and the Toliara project represents a monumental leap forward for the Company, as we continue to execute on a truly revolutionary REE, uranium and critical mineral combined strategy. For the past four-plus years, Energy Fuels has innovated a new way to produce critical minerals, that we believe is more cost competitive than traditional approaches, by leveraging our uranium processing expertise and infrastructure to develop a secure, U.S.-centric REE oxide supply chain. At the same time, we plan to maintain our leadership and profitability in our core U.S.-based uranium business without diminishing our uranium capabilities or uranium growth potential in any way. In fact, Toliara will provide a steady, low-cost source of uranium for the Company over the life of the Project. To date, we have secured long-term sources of REE concentrate through offtake (Chemours), and direct ownership (the Company’s 100% owned Bahia Project in Brazil once developed, and potentially 100% ownership of Base Resources’ Toliara project, and further potential offtakes through a joint venture being negotiated with Astron Corporation Limited (the Astron Donald Project in Australia)). Toliara is expected to be the cornerstone source of feedstock supply to the Mill, with the scale to provide an average of 21,800 tonnes of rare earth-bearing Monazite per year at a cost that we believe will be at or below other leading global REE producers, including those in China. Energy Fuels has proven its REE processing capabilities at our Mill in Utah, as we have commercially produced a high-purity mixed REE carbonate since 2021. We recently completed construction of and are currently commissioning the Phase 1 REE separation circuit at the Mill, designed to produce up to 1,000 tonnes of NdPr oxide per year, which would be sufficient to supply enough ‘magnet’ REE oxides to produce 500,000 to 1 million EVs per year. We have also released the Mill PFS announcing what we believe to be globally competitive capital and REE production costs. Based on these highly compelling economics and the expected consummation of the Base Resources and Astron transactions, Energy Fuels is also planning to update the Phase 2 REE separation infrastructure for the Mill to expand our production capacity to 4,000 to 6,000 tonnes of NdPr oxide per year, along with 150 – 225 tonnes of Dy oxide and 50 – 75 tonnes of Tb oxide per year, which would supply enough ‘magnet’ REE oxides to power 3 to 6 million EVs per year. This would put Energy Fuels in the REE oxide production capacity category of the other major ‘western’ REE suppliers. We plan to supply REE oxides to U.S., European and Asian EV, wind energy and other clean energy manufacturers, along with emerging commercial REE metal-making, alloying, and magnet-making facilities now under development in the U.S. We also plan to be a reliable supplier to the U.S. defense industry, which could include offtake for other REE oxides, besides the ‘magnet’ oxides, contained in Monazite. This acquisition, along with the Mill’s current and planned REE separation capability, will go a long way in establishing a ‘western’ REE supply chain. Energy Fuels is also in high-level discussions with numerous U.S. government agencies and offices that support critical mineral projects, and we look forward to advancing these discussions as we continue to build our REE business. The transaction will not only secure a world-class project for Energy Fuels at a highly attractive acquisition price compared to the fundamental value of the Project but will also secure a mine development and operations team with a successful track-record of designing, constructing, and profitably operating a world-class heavy mineral sands operation in Africa.”