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Energy Fuels is en route to becoming the largest US uranium company with the acquisition of Strathmore Minerals.
The acquisition of Strathmore will make the combined company the largest pure play uranium company in the US with current production of 1.175 million pounds of uranium for 2013 as well as a robust pipeline of development projects.
“Energy Fuels is very pleased with this transaction, because it just makes sense. Our two companies have key projects located in close proximity to one another. Strathmore’s Roca Honda Project is one of the largest and highest-grade uranium projects in the U.S. And, it is within trucking distance of Energy Fuels’ White Mesa Mill, providing the opportunity to put this excellent project into production.” Curtis Moore, spokesperson for Energy Fuels told Uranium Investing News.
In addition, Energy Fuels’ Sheep Mountain project — the largest conventional uranium project currently in development in the US— is not far from Strathmore’s Gas Hills project in Wyoming. With the proximity of Gas Hills, Energy Fuels benefits from “excellent opportunities for synergies and cost savings.” Moore said.
“Most importantly,” Moore concluded, “the transaction enhances our relationship with KEPCO, our largest shareholder and customer, and South Korea’s largest utility. KEPCO is currently developing Gas Hills in a joint venture with Strathmore. In addition, Strathmore is developing the Roca Honda Project in a joint venture with Sumitomo Corporation. Energy Fuels looks forward to moving these projects forward and further cultivating these important relationships.”
Energy Fuels is one of a handful of publicly traded, uranium producers in the world. “This transaction will make Energy Fuels “one of the top two or three holders of uranium resources in the U.S.” Moore said.
The acquisition is an important step for the company in it’s plan to consolidate conventional uranium production in the United States. Recent acquisitions for the company include Denison Mines’ (TSX:DML) U.S. assets and Titan Uranium.
Following the announcement, Energy Fuels is trading at 17 cents, a 12.9 percent climb in its share price.
Securities Disclosure: I, Vivien Diniz, hold no investment interest in any of the companies mentioned in this article.
Editorial Disclosure: Energy Fuels is an advertising client of The Investing News Network. This was not paid for advertising.