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Energy Fuels Inc. (NYSEMKT:UUUU,TSX:EFR) signed a Letter of Intent with Uranium Resources, Inc. (NASDAQ:URRE) for the acquisition of 4,580 acres of mineral properties adjacent to the Roca Honda Project in Mexico. The properties are currently held by Uranium Resources. Upon completion of the acquisition, Energy Fuels expects to transfer the Acquired Properties to Roca Honda subsidiary Roca Honda Resources LLC in consideration of accommodations to be made by Roca Honda joint venture partner Sumitomo Corporation to compensate for its share of acquisition costs.
As quoted in the press release:
Roca Honda is held by the Company’s 60% subsidiary, Roca Honda Resources LLC (“RHR”), with the remaining 40% of RHR held by subsidiaries of the Company’s joint venture partner, Sumitomo Corporation. Upon completion of the acquisition, which is expected to occur in June 2015, Energy Fuels expects to transfer the Acquired Properties to RHR in consideration of accommodations to be made by Sumitomo to compensate for its share of acquisition costs. The transaction is subject to further due diligence, as well as execution of a definitive agreement by the Company and URI, and receipt of stock exchange approvals.
The Acquired Properties, which total approximately 4,580 acres (1,854 hectares), include:
Fee mineral ownership of 640-acres (“Section 17”);
Fee ownership of 36 unpatented lode mining claims; and
A leasehold interest on 131 unpatented lode mining claims.Under the current base case scenario described in a February 2015 preliminary economic assessment and technical report (“PEA”), the Company’s existing Roca Honda project is expected to have a nine-year mine life with average production of approximately 2.6 million pounds of U3O8 per year, processed at the Company’s existing White Mesa Mill located in southeast Utah. Acquisition of the Acquired Properties has the potential to significantly enhance the economics of the existing Roca Honda project through added uranium resources, increased mine life and potential mine plan synergies, as well as potential use of an existing, partially-sunk mine shaft constructed by Kerr-McGee in 1982 to a depth of 1,478 feet, which could result in lower capital requirements and reduced operating costs. There is also the potential to expand Roca Honda’s uranium resources through future drilling and exploration on the Acquired Properties.
Click here to read the Energy Fuels Inc. (NYSEMKT:UUUU,,TSX:EFR) press release
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