Energy Fuels ships first consignment of rare earth carbonate to Europe

Energy Fuels (TSX: EFR; NYSE; UUUU) has shipped the first container of 20 tonnes of mixed rare earth carbonate concentrate to Neo Performance Materials’ (TSX: NEO) Silmet rare earth separation facility in Sillamae, Estonia.

Produced at Energy Fuels’ White Mesa mill in Utah, 508 km southeast of Salt Lake City, the concentrate will be separated into rare earth oxides and other valued-added rare earth products at Silmet. 

The company said the consignment is the first of an expected 15 containers to be sent to the European facility.

“Today, Energy Fuels and Neo took significant steps toward restoring critical U.S. and European rare earth supply chains,” Mark Chalmers, Energy Fuels’ president and CEO, stated in a press release, adding that it is “an important achievement, not only for Energy Fuels and Neo, but also for U.S. government efforts to restore critical rare earth supply chains.”

The two companies have also signed a definitive supply agreement, under which Energy Fuels will ship all or a portion of its rare earth carbonate concentrate to Neo’s Silmet facility for a minimum period of three years.

The high-purity rare earth carbonate concentrate was refined from monazite sand taken from the U.S.-based chemical firm Chemours’ (NYSE: CC) Offerman mineral sand plant in the U.S. state of Georgia.

According to Energy Fuels, monazite from the southeast U.S. typically contains about 55% of total rare earth oxides (TREO), with the magnetic elements neodymium and praseodymium comprising about 22% of the TREO. (Neodymium and praseodymium are key ingredients in the manufacture of high-strength permanent magnets used in the motors of electric vehicles, wind turbines, and in a variety of other technologies, including mobile devices and defence applications.)

Energy Fuels said it is also in discussions with several other parties to secure additional quantities of monazite. The company has a goal of processing 13,608 tonnes of monazite or more per year in the next two to three years. This quantity of monazite, it said, would contain rare earths equal to about 50% of total current U.S. demand, while only utilizing roughly 2% of the White Mesa mill’s existing throughput capacity and less than 1% of its existing tailings capacity.  

In addition to supplying the concentrate to Neo, Energy Fuels is also evaluating the potential to develop separation capabilities at its White Mesa mill and possibly adding manufacturing capabilities for metals, alloys, and rare earth permanent magnets.

As a first step, the company said it had hired the French firm, Carester SAS, one of the world’s leading experts in designing, constructing, and operating rare earth production facilities and rare earth supply chains, to produce a scoping study including capital and operating costs for a full rare earth separations capability at the mill.

Energy Fuels said this would be the next step towards fully integrating a U.S. rare earth supply chain, in addition to continuing to supply rare earth carbonate concentrate to European markets over the long term.

At press time in Toronto, Energy Fuels was trading at $6.73 per share within a 52-week trading range of $1.91 and $9.75. The company has about 134 million common shares outstanding for a $904.1 million market capitalization.