NYSE
American:EU
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www.encoreuranium.com
FUELING THE FUTURE IN THE UNITED STATES
CORPUS
CHRISTI, Texas, Feb. 15,
2023 /CNW/ - enCore Energy Corp.
("enCore" or the "Company") (NYSE American: EU)
(TSXV: EU) is pleased to announce the closing of the acquisition of
the Alta Mesa In-Situ Recovery uranium project from Energy Fuels
Inc. (the "Alta Mesa Acquisition"). The transaction
provides enCore with three licensed uranium in-situ recovery (ISR)
processing plants and positions enCore as a leading US-focused ISR
uranium company with the proven management expertise required to
advance multiple production opportunities within its portfolio.
Transaction Highlights
Alta Mesa includes a fully-licensed
and constructed ISR processing facility that
has an operating capacity of 1.5 million pounds of uranium per
year. Between Alta Mesa, Rosita and Kingsville Dome, all fully
licensed for production, enCore's ISR processing facilities have a
combined potential processing capacity of 3.6 million pounds of
uranium per year.
- Alta Mesa is host to a measured and indicated resource of 3.41
million lbs U3O8 (1.57 million tons at an
average grade of 0.109% U3O8) and an inferred
resource of 16.79 million lbs U3O8 (7.0
million tons at an average grade of 0.120%
U3O8). Abundant exploration upside exists
within the Alta Mesa land package around the existing defined
resource areas, which enCore will prioritize;
- Alta Mesa will diversify enCore's South Texas operations into a 3rd
fully licensed production facility, along with Rosita and
Kingsville Dome, all located in the business-friendly state of
Texas. enCore's mid- and long-term
production potential is further fueled by a pipeline of projects
with Dewey-Burdock in South
Dakota, Gas Hills in Wyoming and additional projects in
New Mexico. There are only 11
licensed production facilities in the
United States;
- Alta Mesa is currently on standby and ready to resume
production. The facility can reach commercial production levels
with limited required capital within an estimated 10 months of a
production decision;
- Control of a large private land package totaling 203,292
contiguous acres, including 4,575-acres currently under a lease and
mining permit and 198,717 acres under a lease-option and
exploration/testing permit;
- The acquisition will further cement enCore's position as a
dominant ISR uranium company and near term future producer in the
US;
- Alta Mesa's operations are located on private land, with 100%
of minerals privately owned, and in a supportive jurisdiction with
primary regulatory authority residing with the State of Texas;
- The Alta Mesa ISR processing facility is a fully permitted and
constructed past-producing ISR operation, with a previous
well-established track record of lower cost uranium production. The
project is fully permitted for uranium extraction upon installation
of the next wellfield;
- Alta Mesa has extensive exploration potential across an area
that has previously identified uranium mineralization;
- Alta Mesa produced a total of 4.6 million pounds of uranium
between October 2005 and November 2013, including 1 million pounds of
uranium per year over a two-year period;
- With low holding costs, Alta Mesa provides fully permitted
lower-cost production scalability that can be brought into
production quickly to provide a domestic energy source for
the United States.
Conference Call: The Company will host an online
conference call on Wednesday, February
22nd, 2023 at 11:00 AM
ET. To register for the presentation please log in at:
https://us02web.zoom.us/webinar/register/WN_eeh5pSOFQwm6FZuu4l5Aog
To view the Alta Mesa project maps and enCore Energy's
South Texas projects please visit:
https://bit.ly/3fV9fTg.
William M. Sheriff, Executive
Chairman of enCore, stated "Alta Mesa is a key acquisition in
enCore's development into the dominant ISR uranium producer in the
state of Texas. With its more immediate plan of restarting
Rosita in later 2023 and greatly expanding its production profile
with the start-up of Alta Mesa in early 2024 our goal of becoming a
3 million pound per year domestic producer from a consolidated base
of operations within a 100 mile radius of Corpus Christi, Texas is well underway.
This Texas platform positions the company well for its continued
growth not only in Texas, but with
planned operations in South
Dakota, Wyoming and
ultimately New Mexico. We are all looking forward to a
dynamic and rewarding 2023. On behalf of the Board of Directors we
extend congratulations to the enCore team for a major
achievement."
Paul Goranson, CEO and
Director of enCore, further added "With the completion of this
transaction enCore is more than doubling our production capacity in
South Texas. As we advance towards
our Q3/23 production goal at our Rosita ISR Uranium Processing
Plant we will commence work at the Alta Mesa Project with plans to
restart production in 2024 with installation of a fully
permitted wellfield. The strong technical team at enCore is excited
to get started at Alta Mesa. Our collective South Texas operations puts us on the path to
becoming a leading producer of uranium in the U.S."
Alta Mesa
The Alta Mesa project is a fully licensed and constructed ISR
project and central processing facility currently on standby,
located on over 203,000 acres of private land in the state of
Texas. Total operating capacity is
1.5 million lbs U3O8 per year. Alta Mesa
historically produced nearly 5 million lbs of
U3O8 between 2005 and 2013, when full
production was curtailed as a result of low uranium prices at the
time. enCore will immediately pursue the resumption of
operations.
Alta Mesa &
Mesteña Grande Mineral
Resource Summary (0.30 GT cut-off)2
|
Tons
('000)
|
Avg.
Grade
(%
U3O8)
|
Pounds
('000)
|
Total Measured Mineral
Resource1
|
54
|
0.152
|
164
|
Alta Mesa Indicated
Mineral Resource
|
1,397
|
0.106
|
2,959
|
Mesteña Grande
Indicated Mineral Resource
|
119
|
0.120
|
287
|
Total Measured &
Indicated Resources
|
1,570
|
0.109
|
3,410
|
Alta Mesa Inferred
Mineral Resource
|
1,263
|
0.126
|
3,192
|
Mesteña Grande
Inferred Mineral Resource
|
5,733
|
0.119
|
13,601
|
Total Inferred
Resources
|
6,996
|
0.120
|
16,793
|
1
Represents that portion of the in-place mineral resource that
are estimated to be recoverable within existing wellfields.
Wellfield recovery factors have not been applied to indicated and
inferred mineral resources.
|
2 As reported in the
NI-43-101 Technical Report Summary for the Alta Mesa Uranium
Project, Brooks and Jim Hogg Counties, Texas, USA completed by Doug
Beahm, PE, PG, of BRS Engineering. (Effective January 19,
2023).
|
The Transaction
The Consideration paid to Energy Fuels consisted of US$60
million in cash and a US$60 million secured vendor
take-back convertible promissory note (the "Note"). The Note
has a two (2) year term and bears interest at a rate of 8% per
annum payable on June 30th and December
31st of each year during the term. The Note is
convertible at the election of the holder, to acquire common shares
of enCore at a price of US$2.9103 per
share. Energy Fuels has agreed not to transact with the common
shares of enCore received on conversion of the Note, including
hedging and short sales, with exceptions for sale transactions of
up to US$10 million in value in any 30-day period, block
trades and underwritten distributions. In addition, Energy Fuels
has agreed to standard standstill provisions restricting additional
acquisitions of enCore securities.
Additional information regarding the Alta Mesa Project
acquisition, is available in the Company's news release dated
November 14, 2022.
In connection with the closing of the Alta Mesa Acquisition,
23,277,000 subscription receipts issued December 6, 2022 at a price of C$3.00 per Subscription Receipt (the
"Subscription Receipt Offering") were automatically
converted into units comprised of one common share of enCore and
one common share purchase warrant, with each warrant entitling the
holder thereof to acquire one common share of enCore at a price of
C$3.75 for a period of 3 years until
February 14, 2026. The net proceeds
from the Subscription Receipt Offering of approximately
C$66 million, after deduction of fees
and commissions, have been released from escrow to the Company, and
were applied to fund the cash portion of the consideration payable
by the Company pursuant to the Alta Mesa Acquisition.
For additional information regarding the Subscription Receipt
Offering, please see the Company's news release dated December 6, 2022.
Additionally, further to the Company's news release dated
February 8, 2023 announcing the
closing of the offering of units for proceeds of C$34.5 million, the Company advises that it paid
cash commissions to Canaccord Genuity Corp. (C$1,065,756.17), Cantor Fitzgerald Canada
Corporation (C$659,753.82), and
Haywood Securities Inc. (C$304,501.76). For additional information
regarding the unit offering, please see the Company's news release
dated February 8, 2023.
John M. Seeley, Ph.D., P.G., CPC,
enCore's Manager of Geology and Exploration, and a Qualified Person
under NI 43-101, has reviewed and approved the technical disclosure
in this news release on behalf of enCore.
About enCore Energy
Corp.
enCore Energy is the most diversified In-Situ Recovery (ISR)
uranium development company in the United
States and is focused on becoming the next uranium producer
in 2023 from its licensed and past-producing South Texas Rosita
Processing Plant. The Alta Mesa Project is scheduled to come online
in 2024 and position enCore as a leading US-focused ISR uranium
company with the proven management expertise required to advance
multiple production opportunities within its portfolio. The
South Dakota-based Dewey-Burdock
project and the Wyoming Gas Hills project offer mid-term production
opportunities, with significant New
Mexico uranium resource endowments providing long-term
opportunities. The enCore team is led by industry experts with
extensive knowledge and experience in all aspects of ISR uranium
operations and the nuclear fuel cycle. enCore is committed to
engaging and working with local communities and indigenous
governments to create positive impact from corporate
developments.
- NI-43-101 Technical Report Summary for the Alta Mesa Uranium
Project, Brooks and Jim Hogg Counties, Texas, USA completed by Doug Beahm, PE, PG, of
BRS Engineering. (Effective January 19,
2023).
Neither the TSX Venture Exchange nor its Regulation Services
Provider (as that term is defined in the policies of the TSX
Venture Exchange) accepts responsibility for the adequacy or
accuracy of this release.
Cautionary Note Regarding Forward-Looking
Statements: Certain information contained in this
news release, including: any information relating to the Company
being a leading uranium company; the ability of the Company to
produce and process uranium from its projects including the Alta
Mesa, Rosita and Kingsville Dome projects, and to realize the
expected benefits of the Alta Mesa Acquisition; and any other
statements regarding future expectations, beliefs, goals or
prospects; may constitute "forward-looking information" and
"forward-looking statements" within the meaning of applicable
Canadian and United States
securities legislation (collectively, "forward-looking
statements"). All statements in this news release that are not
statements of historical fact (including statements containing the
words "expects", "is expected", "does not expect", "plans",
"anticipates", "does not anticipate", "believes", "intends",
"estimates", "projects", "potential", "scheduled", "forecast",
"budget" and similar expressions or variations (including negative
variations) of such words and phrases, or statements that certain
actions, events or results "may", "could", "would", "might" or
"will" be taken) should be considered forward-looking statements.
All such forward-looking statements are subject to important risk
factors and uncertainties, many of which are beyond the companies'
ability to control or predict. Forward-looking statements
necessarily involve known and unknown risks, including, without
limitation, risks associated with general economic conditions;
adverse industry events; risks associated with accessing additional
funding required for the transactions and operations discussed in
this news release; the Company's ability to advance production and
processing at the Alta Mesa Project and other facilities; future
legislative and regulatory developments; the ability of enCore to
implement its business strategies; and other risks. A number of
important factors could cause actual results or events to differ
materially from those indicated or implied by such forward-looking
statements, including without limitation exploration and
development risks, changes in commodity prices, access to skilled
mining personnel, the results of exploration and development
activities; uninsured risks; regulatory risks; defects in title;
the availability of materials and equipment, timeliness of
government approvals and unanticipated environmental impacts on
operations; risks posed by the economic and political environments
in which the Company operates and intends to operate; the potential
for losses arising from the expansion of operations into new
markets; increased competition; assumptions regarding market trends
and the expected demand and desires for the Company's products and
proposed products; reliance on industry manufacturers, suppliers
and others; the failure to adequately protect intellectual
property; the failure to adequately manage future growth; adverse
market conditions, the failure to satisfy ongoing regulatory
requirements and factors relating to forward looking statements
listed above which include risks as disclosed in the companies'
annual information form filings. Should one or more of these risks
materialize, or should assumptions underlying the forward-looking
statements prove incorrect, actual results may vary materially from
those described herein as intended, planned, anticipated, believed,
estimated or expected. The Company assumes no obligation to update
the information in this communication, except as required by law.
Additional information identifying risks and uncertainties is
contained in filings by the Company with the various securities
commissions which are available online at www.sec.gov
and www.sedar.com. Forward-looking statements are provided for
the purpose of providing information about the current
expectations, beliefs and plans of management. Such statements may
not be appropriate for other purposes and readers should not place
undue reliance on these forward-looking statements, that speak only
as of the date hereof, as there can be no assurance that the
plans, intentions or expectations upon which they are placed will
occur. Such information, although considered reasonable by
management at the time of preparation, may prove to be incorrect
and actual results may differ materially from those anticipated.
Forward-looking statements contained in this news release are
expressly qualified by this cautionary statement.
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SOURCE enCore Energy Corp.