Shares of Energy Fuels Inc. climbed as much as 6% on Thursday following the release of a comprehensive feasibility study for its rare earth element production plans. The report contained positive surprises, indicating that the Phase 2 expansion of the White Mesa Mill in Utah will be less expensive than previously anticipated while delivering impressive projected margins.
Robust Economics and Strategic Ambition
The financial metrics outlined for the standalone Phase 2 expansion are compelling:
* After-tax Net Present Value (NPV): $1.9 billion (using an 8% discount rate)
* Internal Rate of Return (IRR): 33%
* All-in operating cost for neodymium-praseodymium (NdPr) oxide: $29.39 per kilogram
A central finding of the study is the estimated capital expenditure for the Phase 2 build-out, which is set at $410 million—a figure that comes in below initial expectations and strengthens the project’s economic foundation.
The outlook becomes even more significant when the Phase 2 project is combined with the planned Vara-Mada initiative. Together, these operations are projected to achieve a combined NPV of $3.7 billion. Annual EBITDA for the first 15 years is estimated at $765 million for the combined projects, compared to $311 million for the Phase 2 expansion alone.
On the production front, the facility is designed to yield over 6,000 tonnes of neodymium-praseodymium oxide annually, alongside 240 tonnes of dysprosium and 66 tonnes of terbium. These heavy rare earth elements are in high demand for advanced technological and defense applications.
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A Dual-Commodity Leader in the Making
Energy Fuels is strategically positioning its White Mesa Mill as a cornerstone for U.S. critical mineral supply. The company has set an ambitious goal: to potentially satisfy up to 45% of total U.S. rare earth element demand by 2030, with the capacity to meet 100% of domestic requirements for heavy rare earths like terbium and dysprosium.
The projected operating cost of $29.39/kg for NdPr oxide could provide a substantial buffer against global price volatility, potentially serving as a key competitive advantage.
This rare earths initiative runs parallel to the company’s established uranium business, which continues to perform steadily. Energy Fuels recently reported exceeding its annual uranium production targets as of the end of December 2025. This dual focus as a leading U.S. uranium producer and an emerging force in the rare earths sector distinguishes the company from its peers.
Path Forward and Key Dependencies
While the feasibility study represents a major milestone, significant work remains. The company is targeting final regulatory approvals by mid-2027, with full commissioning of the Phase 2 expansion expected in the first quarter of 2029.
A primary risk factor identified is feedstock supply. The project’s economics rely on a consistent supply of monazite concentrates from sources in Madagascar, Brazil, and Australia. The stability of these international supply chains will be critical for achieving the projected production volumes and financial targets.
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