Energy Fuels Inc. (NYSE MKT:UUUU)(NYSE:EFR) has the right to continue development and production at its high grade Canyon Uranium Mine after a United States Federal District Court in Arizona ruled against the Sierra Club, the Center for Biological Diversity, the Grand Canyon Trust, and the Havasupai Tribe in their challenge to the mine's regulatory permits and approvals. The challenge was filed by the NGO's and the tribe against the US Forest Service (USFS). Energy Fuels intervened to protect its interests.
Judge David G. Campbell rejected all of the plaintiffs' claims, including allegations of non-compliance with various environmental and cultural laws, and claims that the USFS failed to consult with the Havasupai upon the company's announcing the resumption of work at the Canyon mine.
The company also noted that the plaintiffs failed to make any assertions about substantive environmental, health or safety issues or violations. Rather, the Judge noted that the USFS has performed extensive environmental studies and consultations concerning the project.
"We are pleased that the federal court rejected the plaintiffs' challenges to the Canyon mine, which allows us to continue our development of this high-grade deposit….The Canyon mine has been heavily studied, and the technical and geologic characteristics of the project are well-understood.", said Energy Fuels' President and CEO, Stephen P. Antony.
Last February, the company said was getting ready to re-launch mining operations at the Canyon property, shifting production from its currently producing Pinenut mine to the Canyon mine, as the Pinenut's resources are depleted.
The Canyon mine is estimated to have 1.63 million pounds of inferred uranium resources with an average grade of 0.98%, according to a 2012 technical report. Surface development- including a headframe, evaporation pond, hoist, environmental controls, and a maintenance facility- is already in place.
Energy Fuels expects to sink an additional 1,200 feet of shaft, install a ventilation shaft and complete underground development to begin ore production operations.
Energy Fuels is the largest conventional uranium producer in the United States. It owns the White Mesa mill, which is the only conventional uranium mill operating in the U.S. and is capable of processing 2,000 tons per day of uranium ore and 8+ million lbs. of U3O8 per year. In light of weak uranium prices, the company is only selling uranium under its long term contracts, though it is maintaining and building its ability to increase production as uranium market conditions continue to improve.
Last March, despite a weak uranium market, Energy Fuels managed to post higher 2014 gross profit and a stronger balance sheet, all while securing a deal to acquire Uranerz Energy to become the largest integrated uranium miner focused in the United States. The combined company will have both conventional and in situ recovery ("ISR") uranium production in its portfolio.
The company, which reports in US currency, posted its financial results for the year ended December 31, 2014, exiting the year with $38.6 million of working capital and cash and equivalents of $10.4 million.
Energy Fuels was trading 1.12 percent lower, at US$4.22/share this morning on the NYSE MKT.