Image Credit: Johannes Plenio (Pexels)

Uranium is Reacting to Increasing Demand in the U.S. with Increased Support from Washington

The Senate approved Inflation Reduction Act (IRA) is yet another nod to nuclear energy. As the world is coming around to the idea that a significant, non-weather-dependent energy source is needed, if there is to be a successful transition away from fossil fuels, nuclear, more specifically, uranium fueled power, continues to get the nod from the U.S. Department of Energy (DOE), lawmakers in Washington, green energy groups, and even from countries like Japan and Germany. 

This IRA bill that just passed in the Senate is headed to the House with almost $400 billion in energy security and climate-related programs over the next ten years. It is expected to easily pass without much renegotiation between the two branches of Congress. Below are some specifics on how it will impact the nuclear energy industry and, therefore, uranium investments. 

 

Enriched Tax Credits for Nuclear Energy

There is a provision that improves upon the Zero-Emissions Nuclear Production law, which is a Power Tax Credit specific for nuclear energy producers. It is in the form of a scaled credit based on plant revenue and applies to existing power plants. The program now includes nuclear and would begin in 2024 and end in 2032; it will offer 5x the benefit if labor requirements are adhered to. The 2032 deadline is an extension of the original plan, which was included in Build Back Better.

The IRA provides for a technology-neutral clean energy production credit of 0.3 cents * kWh base rate for ten years starting in 2025. New, to the program is that energy producers (including coal) will receive a 10% credit in addition to any clean energy credit. This benefit does not look at the technology that is producing the energy.

 

High-Assay Low Enrichment Uranium (HALEU)

The version that passed the Senate also includes $700 million for HALEU, which is the fuel expected to be used in the next generation of reactors. This is interesting in that HALEU production is limited to Russia.

The HALEU funding is broken down into three categories and references the Energy Act of 2020:

• $100M: Licensing and regulation of facilities and transportation packages.
• $500M: Acquiring or providing HALEU from a stockpile of uranium to produce HALEU, estimating the quantity of HALEU necessary for domestic, commercial use, and developing a consortium to support the availability of HALEU for civilian use.
• $100M: Support the availability of HALEU for civilian domestic research, development, demonstration, and commercial.

DOE Loans

The bill also includes $250 billion for DOE loans. The loans will help provide funding to smooth the road toward building tomorrow’s carbon-free technology currently in development.

 

Related Investments

There are many non-energy generating U.S. companies involved in the various areas of providing nuclear fuel and even storing spent fuel. Additionally, there is a futures market and ETFs that either work to mimic the price changes in U308 or own uranium outright and store and provide valuation on the trust.

Source: Pennsylvania
State University Radiation Science and Engineering Center (Public Domain)

The chart below is provided as an example of how companies involved in producing uranium, uranium futures, and the ETF that owns the mineral all trade in relation to each other (three-month period).

Energy Fuels (UUUU) is the largest uranium producer in the U.S. and holds more production capacity and uranium resources than any other U.S. producer. A new research report update on Energy Fuels by Noble Capital Markets was released today (August 8). Read it here.

Source: Koyfin

enCore Energy Corp. (ENCUF) is focused on becoming a domestic (USA) uranium producer. It has significant existing resources in the southwest United States and licensed uranium production facilities in Texas; encore holds the largest uranium position in the Grants Mineral Belt and licensed processing capacity to respond quickly to market opportunities. Discover more here.

Peninsula Energy Ltd (PENMF) is a uranium mining and development company. Projects include Lance ISR Uranium Projects located on the north-east flank of the Powder River Basin in Wyoming and Karoo Uranium Projects in South Africa. It has three reportable operating segments, Lance uranium projects, Wyoming USA; Karoo uranium projects, South Africa; and Corporate. More data on Peninsula Energy is available here, and in the video link below.

Take Away

The provisions in the Inflation Reduction Bill, which seems sure to pass the House and be signed into law, would seem to create a tailwind worth several hundred billion to the industry. It also serves as a glowing nod toward nuclear as one important piece to meeting reduced carbon emissions goals.

The IRA bill gives current investors in the related nuclear power and uranium industries a reason to be more bullish and newer investors a reason to react to the possibility of adding stocks of producers, futures contracts, or uranium itself into their portfolios.

Paul Hoffman

Managing Editor, Channelchek

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Energy Fuels (UUUU) NobleCon18 – Presentation Replay

Sources

 

https://www.eia.gov/energyexplained/nuclear/the-nuclear-fuel-cycle.php

https://www.eia.gov/todayinenergy/detail.php?id=51978

https://thebreakthrough.org/articles/advancing-nuclear-energy-report

https://www.whitehouse.gov/wp-content/uploads/2022/08/SAP-H.R.-5376.pdf

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Energy Fuels Announces Q2-2022 Results, Including Continued Robust Balance Sheet And Market-Leading U.S. Uranium And Rare Earth Positions

Research, News, and Market Data on Energy Fuels

Webcast
on August 9, 2022

 

LAKEWOOD, Colo., Aug. 5, 2022 /CNW/ – 
Energy Fuels Inc. (NYSE: UUUU) (TSX: EFR) (“Energy Fuels” or the “Company”) today reported its financial results for the quarter ended June 30, 2022. The Company’s quarterly report on Form 10-Q has been filed with the U.S. Securities and Exchange Commission (“SEC“) and may be viewed on the Electronic Document Gathering and Retrieval System (“EDGAR“) at 
www.sec.gov/edgar.shtml, on the System for Electronic Document Analysis and Retrieval (“SEDAR“) at www.sedar.com, and on the Company’s website at www.energyfuels.com. Unless noted otherwise, all dollar amounts are in U.S. dollars.

Highlights:

• At June 30, 2022, the Company had a robust balance sheet with $134.1 million of working capital, including $86.4 million of cash and cash equivalents, $11.8 million of marketable securities, $28.6 million of inventory, and no short term (or long term) debt. At current commodity prices, the Company’s product inventory has a value of $43.9 million.
• During the quarter ended June 30, 2022, the Company incurred a net loss of $18.1 million, which included a non-cash mark-to-market decrease in the value of investments accounted for at fair value of $13.4 million.
• During Q2-2022, the Company entered into three (3) long-term uranium sales contracts with U.S. nuclear utilities. Base quantities under these contracts total 3.0 million pounds with deliveries to occur during the 2023 – 2030 time period. If the buyers exercise all options, total delivery quantities could increase to as much as 4.2 million pounds. Annual quantities vary year-to-year, with lower delivery quantities in the early years, and higher quantities in the later years. Contract pricing has a fixed price component (fully indexed to inflation) and a spot market component, along with floor and ceiling prices (fully indexed to inflation). The Company expects to fulfill deliveries during the early years of these contracts from its significant existing produced inventories.
• In June 2022, the U.S. Department of Energy (“DOE“) issued a Request for Proposals (“RFP“) to purchase uranium (“U₃O₈“) for the new U.S. Uranium Reserve (the “Reserve“). The DOE states that they expect to purchase up to 1 million pounds of U₃O₈ inventory from up to four (4) qualified U.S. uranium producers. The uranium must be physically located at Honeywell’s Metropolis Works conversion facility (the “U.S. Converter“). Energy Fuels believes it meets all qualifications to supply the Reserve, and the Company currently holds about 692,000 pounds of U₃O₈ at the U.S. Converter. The Company has submitted a bid to sell U₃O₈ to the Reserve, taking into consideration its long-term contract commitments and current and expected market conditions. There are no guarantees the DOE will purchase uranium from the Company under this RFP.
• During the first half of 2022, the Company produced approximately 205 tonnes of mixed rare earth element (“REE“) carbonate (“RE Carbonate“), containing approximately 95 tonnes of total rare earth oxides (“TREO“). Energy Fuels’ RE Carbonate, which is roughly 32% – 34% NdPr, is the most advanced REE material being produced in the U.S. today.
• In May 2022, the Company announced it had entered into agreements to acquire a 58 square mile rare earth land position in Brazil (the “Bahia Project“). The Bahia Project is a well-known heavy mineral sand (“HMS“) deposit that has the potential to feed the Company’s White Mesa Mill with REE and uranium-bearing monazite sand for decades. Due diligence is ongoing, and closing is currently expected to occur on or around August 31, 2022. After closing, the Company expects to conduct an extensive exploration program to better define the HMS and monazite resource, including comprehensive sonic drilling and geophysical mapping with the intent to complete an Initial Assessment under SK-1300 (U.S.) and a Preliminary Economic Assessment under NI 43-101 (Canada) during Q4-2022 or Q1-2023.
• The Company is currently in active discussions with several additional sources of natural monazite sands around the world to significantly increase the supply of feed for its growing REE initiative.
• The Company continues to make excellent progress toward installing full REE separation capabilities at the Mill to produce both “light” and “heavy” separated REE oxides in the coming years, subject to successful licensing, financing, and commissioning, and continued strong market conditions. The Company has hired Carester SAS (“Carester“), a global leader in producing separated REE oxides, to support these REE separation initiatives. The Company is also evaluating installing a smaller “light” separation circuit within the existing Mill facilities with the ability to produce up to 1,500 tonnes TREO and 375 tonnes of NdPr oxide per year in the next 18-24 months. Initial estimates indicate low capital and operating costs for this circuit until a larger facility in the order of 10,000 tonnes TREO can be permitted, constructed and commissioned.
• During the first half of 2022, the Company sold approximately 575,000 pounds of the Company’s existing inventory of vanadium (“V₂O₅“) (as ferrovanadium, “FeV“), for an average weighted net price of $13.44 per pound of V₂O₅. Vanadium markets have dropped in recent weeks. Therefore, the Company has halted sales of its inventory which currently stands at approximately 1.05 million pounds of V₂O₅. However, the Company expects to resume sales when markets improve again. The Company is evaluating the potential to resume vanadium recovery at the Mill in the future as market conditions may warrant for future sale and to replace sold inventory, where its tailings pond solutions contain an estimated additional 1.0 to 3.0 million recoverable pounds of V₂O₅.
• To bolster the Company’s management team during its current growth phase and expansion into the REE industry, Energy Fuels has hired John Uhrie as Chief Operating Officer (“COO“), effective August 1, 2022, and Tom Brock as Chief Financial Officer (“CFO“), effective August 8, 2022. Mr. David Frydenlund, the Company’s current CFO, General Counsel and Corporate Secretary, was appointed to the position of Executive Vice President, Chief Legal Officer and Corporate Secretary of the Company, effective August 8, 2022. Mr. Brock previously served as Vice President and Chief Accounting Officer for Extraction Oil and Gas Inc. and prior thereto as Vice President, Chief Accounting Officer and Corporate Controller for American Midstream Partners LP. Dr. Uhrie most recently served as Vice President for Metals, Exploration and Development for The Doe Run Company, a global leader in lead, zinc and copper production and prior thereto as President, Consulting Services of the Americas for RPM Global, as Manager of Process Metallurgy for Newmont Mining Corp., and as Manager, Metallurgy and Strategic Planning, Africa and Manager of Hydrometallurgical Operations for Freeport McMoRan Copper and Gold, Bagdad Operations. Both Mr. Brock and Dr. Uhrie bring significant experience in managing producing natural resource companies.

Mark S. Chalmers, Energy Fuels’ President and CEO, stated:

“Energy Fuels continues to make progress on all fronts of our uranium, rare earth, vanadium and medical isotope businesses. Uranium markets have been volatile but remain strong. We continue to believe the short and long-term fundamentals for uranium continue to point to higher pricing. We are extremely pleased to announce the execution of three long-term contracts with U.S. nuclear utilities. With up to 4.2 million pounds of uranium deliveries between 2023 and 2030, at attractive pricing and other terms, these contracts will help underpin Energy Fuels’ uranium business for many years to come. We are also beginning to perform the work needed to recommence production at one or more of our uranium mines. The Company’s substantial existing uranium inventories are expected to provide sufficient uranium for the early years of the contract deliveries. However, we expect to be in production at one or more of our uranium mines in the next two years. Our substantial inventories will also allow Energy Fuels the potential to offer significant quantities of uranium to the new U.S. Uranium Reserve. During the second half of 2022, we expect to shift back to processing stockpiled ores for uranium production, and we expect to produce 100,000 to 120,000 pounds of uranium in 2022.

“We sold some of our substantial vanadium inventories during the first half of 2022, as prices rose during the quarter. However, in recent weeks, vanadium prices have dropped back. Therefore, we stopped our sales. Nonetheless, during the first half of 2022, we sold about 575,000 pounds of V₂O₅, contained in ferrovanadium, at an average net price of $13.44 per pound V₂O₅. Our vanadium inventory was carried on our balance sheet at $6.09 per pound V₂O₅, so we have been able to capture some gross margin on these sales. Plus, we still have another 1.05 million pounds of V₂O₅ in inventory that we can sell into future market strength.

“Energy Fuels’ rare earth initiative continues to proceed extremely well, and we believe we are making more progress, faster, than any other U.S. company. Last year, we began production of a high-purity mixed rare earth carbonate that is ready for separation. No other company in the U.S. is commercially producing a product as advanced as Energy Fuels. In March 2022, we began the partial separation of lanthanum from our rare earth carbonate, using existing solvent extraction equipment at our White Mesa Mill. This is the first commercial-scale rare earth separation to occur in the U.S. in many years. As a result, we produced a very high-purity rare earth carbonate, with most of the lanthanum removed, that contains about 32% – 34% NdPr. We also performed pilot-scale rare earth separation in the Mill’s laboratory, where we produced about two kilograms of high-purity NdPr oxide per day. We expect to resume rare earth processing later in 2022, when we receive additional shipments of monazite sand from Chemours. It is early days, but with the outstanding achievements of our internal staff, complemented by our relationships with Neo Performance Materials (“Neo“) and Carester, we are confident that we will restore U.S. rare earth separation capabilities in the coming years.

“Finally, our medical isotope initiative is also advancing nicely. As previously announced, we are evaluating the recovery of radioisotopes from our existing uranium and rare earth process streams at the White Mesa Mill that could potentially be used in emerging targeted alpha therapy (“TAT“) cancer therapeutics. We look forward to providing more information on this initiative in the coming months.

“Lastly, I would like to welcome Tom Brock and John Uhrie to Energy Fuels’ management team. I believe Energy fuels is making the leap to large-scale production of uranium and rare earth elements in the coming years. Therefore, we are extremely pleased to add these two individuals to our management team, both of whom have extensive experience in managing operating natural resource companies.”

Webcast at 4:00 pm EDT on August 9, 2022:

Energy Fuels will be hosting a video webcast on August 9, 2022 at 4:00 pm EDT (2:00 pm MDT) to discuss its Q2-2022 financial results, the outlook for 2022, uranium, rare earths, vanadium, and medical isotopes. To join the webcast and access the presentation and viewer-controlled webcast slides, please click on the link below:

Webcast Link

If you would like to participate in the webcast and ask questions, please dial in to 1-888-664-6392 (toll free in the U.S. and Canada).

A link to a recorded version of the proceedings will be available on the Company’s website shortly after the webcast by calling 1-888-390-0541 (toll free in the U.S. and Canada) and by entering the code 536175#. The recording will be available until August 23, 2022.

Selected Summary Financial Information:

$000’s, except per share data	Six months ended June 30, 2022			Six months ended June 30, 2021
Results of Operations:
Total revenues	$	9,404		$	809
Gross profit	3,093			809
Operating loss	(16,920)			(17,189)
Net loss attributable to the company	(32,783)			(21,692)
Basic and diluted net loss per common share	(0.21)			(0.15)
$000’s	As at June 30, 2022			As at December 31, 2021
Financial Position:
Working capital	$	134,089		$	143,190
Property, plant and equipment, net	21,515			21,983
Mineral properties	83,539			83,539
Total assets	288,258			315,446
Total long-term liabilities	13,927			13,805

Financial Discussion:

At June 30, 2022, the Company had $134.1 million of working capital, including $98.1 million of cash and cash equivalents and marketable securities and $28.6 million of inventory, including approximately 692,000 pounds of uranium and 1.05 million pounds of high-purity vanadium, both in the form of immediately marketable product. The current spot price of U₃O₈, according to TradeTech, is $48.75 per pound, and the current mid-point spot price of V₂O₅, according to Metal Bulletin, is $8.00 per pound. Based on those spot prices, the Company’s uranium and vanadium inventories have a current market value of $33.7 million and $8.4 million, respectively, totaling $42.1 million. The Company also holds RE Carbonate inventory with a current value of $1.8 million, for total product inventory of $43.9 million at current commodity prices.

During the quarter ended June 30, 2022, the Company incurred a net loss of $18.1 million, compared to a net loss of $10.8 million for the second quarter of 2021, and a net loss of $32.8 million for the six months ended June 30, 2022 compared to a net loss of $21.7 million during the first six months of 2021. The increased net losses in 2022 are due primarily to a non-cash mark-to-market decrease in the value of investments accounted for at fair value of $13.4 million for the second quarter of 2022 and $16.8 million for the six months ended June 30, 2022. The Company has seen improvement in the value of these investments accounted for at fair value subsequent to quarter end.

Operations Update and Outlook for 2022:

Overview

The Company continues to believe that uranium supply and demand fundamentals point to higher sustained uranium prices in the future. In addition, Russia’s recent invasion of Ukraine and the recent entry into the uranium market by financial entities purchasing uranium on the spot market to hold for the long-term has the potential to result in higher sustained spot and term prices and, perhaps, induce utilities to enter into more long-term contracts with non-Russian producers like Energy Fuels to ensure security of supply and more certain pricing. Having recently secured three long-term uranium contracts with major U.S. utilities, the Company is beginning to perform the work needed to recommence production at one or more of its mines and in-situ recovery (“ISR“) facilities, starting as soon as 2023. Until such time when the Company has ramped back up to commercial uranium production, it can rely on its significant uranium inventories to fulfill its new contract requirements. The Company also continues to evaluate selling a portion of its inventories on the spot market in response to future upside price volatility, into the newly created U.S. Uranium Reserve Program, or for delivery into additional long-term supply contracts if procured. During the first half of 2022, the Company also began selling a portion of its vanadium inventory into then strengthening markets.

The Company will also continue to seek new sources of revenue, including through its emerging REE business, as well as new sources of Alternate Feed Materials and new fee processing opportunities at the Mill that can be processed without reliance on current uranium sales prices. The Company is also seeking new sources of natural monazite sands (in addition to the proposed acquisition of the Bahia Project) for its emerging REE business, is evaluating the potential to recover radioisotopes for use in the development of TAT medical isotopes for the treatment of cancer, and continues its support of U.S. governmental activities to assist the U.S. uranium mining industry, including the new U.S. Uranium Reserve Program and other efforts to restore domestic nuclear fuel capabilities.

Extraction and Recovery Activities Overview

During 2022, the Company plans to recover 100,000 to 120,000 pounds of uranium and approximately 650 to 1,000 tonnes of mixed RE Carbonate containing approximately 300 to 450 tonnes of TREO.

No vanadium production is currently planned during 2022, though the Company sold some of its existing vanadium inventory into recent strong markets and is evaluating the potential to recommence vanadium production in 2023 or later years as market conditions may warrant for future sale and to replace sold inventory.

The Company has secured three new long-term sales contracts with U.S. nuclear utilities and is continuing to strategically pursue additional uranium sales commitments with pricing expected to have both fixed and market-related components. The Company believes that recent price increases, volatility and focus on security of supply in light of Russia’s invasion of Ukraine have increased the potential for the Company to make uranium sales and procure additional term sales contracts with utilities at pricing that sustains production and covers corporate overhead. Therefore, existing inventories may increase from 692,000 pounds of U₃O₈ to 792,000 to 812,000 pounds of U₃O₈ at year-end 2022 or may increase to a lesser extent, or be reduced, in the event the Company sells a portion of its inventory on the spot market, to the U.S. Uranium Reserve, or pursuant to term contracts in 2022.

ISR Activities

The Company expects to produce insignificant quantities of U₃O₈ in the year ending December 31, 2022 from Nichols Ranch and Alta Mesa. Until such time when market conditions improve sufficiently, suitable term sales contracts can be procured, or the U.S. Uranium Reserve Program is expanded, the Company expects to maintain the Nichols Ranch and Alta Mesa Projects on standby and defer development of further wellfields and header houses.

Conventional Activities

Conventional Extraction and Recovery Activities

During the six months ended June 30, 2022, the Mill did not package any material quantities of U₃O_8, focusing instead on developing its REE recovery business. During the six months ended June 30, 2022, the Mill produced approximately 205 tonnes of RE Carbonate, containing approximately 95 tonnes of TREO. The Mill recovered small quantities of uranium during the Quarter, which were retained in circuit. During 2022, the Company expects to recover 100,000 to 120,000 pounds of uranium at the Mill as finished product. The Company expects to recover approximately 650 to 1,000 tonnes of mixed RE Carbonate containing approximately 300 to 450 tonnes of TREO at the Mill during 2022. The Company expects to sell all or a portion of its mixed RE Carbonate to Neo or other global separation facilities and/or to stockpile it for future production of separated REE oxides at the Mill or elsewhere. The Company is in advanced discussions with several sources of natural monazite sands (in addition to the Bahia Project) to secure additional supplies of monazite sands, which if successful, would be expected to allow the Company to increase RE Carbonate production.

In addition to its 692,000 pounds of finished uranium inventories currently located at North American conversion facilities and at the Mill, the Company has approximately 300,000 pounds of U₃O₈ contained in stockpiled Alternate Feed Materials and other ore inventory at the Mill that can be recovered relatively quickly in the future, as general market conditions may warrant (totaling about 992,000 pounds of U₃O₈ of total uranium inventory). The Company is also seeking to acquire additional ore inventory from third party mine cleanup activities that can be recovered relatively quickly in the future.

The Company currently holds 1.05 million pounds of V₂O₅ in inventory, and there remains an estimated 1.0 to 3.0 million pounds of additional solubilized recoverable V₂O₅ remaining in tailings solutions awaiting future recovery, as market conditions may warrant.

Conventional Standby, Permitting and Evaluation Activities

During the six months ended June 30, 2022, standby and environmental compliance activities continued at the fully permitted and substantially developed Pinyon Plain Project (uranium and, potentially, copper) and the fully permitted and developed La Sal Complex (uranium and vanadium). The Company plans to continue carrying out engineering, metallurgical testing, procurement and construction management activities at its Pinyon Plain Project. The timing of the Company’s plans to extract and process mineralized materials from these Projects will be based on sustained improvements in general market conditions, procurement of suitable sales contracts and/or the expansion of the U.S. Uranium Reserve Program.

The Company is selectively advancing certain permits at its other major conventional uranium projects, such as the Roca Honda Project, which is a large, high-grade conventional project in New Mexico. The Company is also continuing to maintain required permits at its conventional projects, including the Whirlwind Project, which came out of temporary cessation during the Quarter, and the Sheep Mountain project. In addition, the Company will continue to evaluate the Bullfrog Project. Expenditures for certain of these projects have been adjusted to coincide with expected dates of price recoveries based on the Company’s forecasts. All these projects serve as important pipeline assets for the Company’s future conventional production capabilities, as market conditions may warrant.

Uranium Sales

During the six months ended June 30, 2022, the Company entered into three uranium sale and purchase agreements with major U.S. utilities, constituting its first new long-term supply contracts since 2018. Having observed a marked uptick in interest from nuclear utilities seeking long-term uranium supply, the Company remains actively engaged in pursuing additional selective long-term uranium sales contracts. 

The Company submitted a bid to sell a portion of its existing uranium inventory into the U.S. Uranium Reserve at pricing that provides an appropriate rate of return to the Company. There are no guarantees that the U.S. government will buy all, or any, of the uranium the Company offers for sale.

Vanadium Sales

As a result of strengthening vanadium markets, during the six months ended June 30, 2022, the Company sold approximately 575,000 pounds of V₂O₅ (as FeV) at a gross weighted average price of $13.44 per pound of V
₂O₅. The Company expects to sell its remaining finished vanadium product when justified into the metallurgical industry, as well as other markets that demand a higher purity product, including the aerospace, chemical, and potentially the vanadium battery industries. The Company expects to sell to a diverse group of customers in order to maximize revenues and profits. The vanadium produced in the 2018/19 pond return campaign was a high-purity vanadium product of 99.6%-99.7% V₂O₅. The Company believes there may be opportunities to sell certain quantities of this high-purity material at a premium to reported spot prices. The Company may also retain vanadium product in inventory for future sale, depending on vanadium spot prices and general market conditions.

RE Carbonate Sales

The Company commenced its ramp-up to commercial production of a mixed RE Carbonate in March 2021 and has shipped all its RE Carbonate produced to-date to Neo’s Silmet facility in Estonia, where it is currently being fed into their separation process. All RE Carbonate produced at the Mill in 2022 is expected to be sold to Neo for separation at Silmet. Until such time as the Company expects to permit and construct its own separation circuits at the Mill, production in future years is expected to be sold to Neo for separation at Silmet and, potentially, to other REE separation facilities outside the U.S. To the extent not sold, the Company expects to stockpile mixed RE Carbonate at the Mill for future separation and other downstream REE processing at the Mill or elsewhere. During the quarter ended June 30, 2022, the Company sold approximately 18,000 kilograms of TREO at an average price of $25.35 per kilogram of TREO.

As the Company continues to ramp up its mixed RE Carbonate production and additional funds are spent on process enhancements, improving recoveries, product quality and other optimization, profits from this initiative are expected to be minimal until such time when monazite throughput rates are increased and optimized. However, even at the current throughput rates, the Company is recovering most of its direct costs of this growing initiative, with the other costs associated with ramping up production, process enhancements and evaluating future separation capabilities at the Mill being expensed as underutilized capacity production costs applicable to RE Carbonate and development expenditures. Throughout this process, the Company is gaining important knowledge, experience and technical information, all of which will be valuable for current and future mixed RE Carbonate production and expected future production of separated REE oxides and other advanced REE materials at the Mill. As discussed above, the Company is evaluating installing a full separation circuit at the Mill to produce both “light” and “heavy” separated REE oxides in the coming years, subject to successful licensing, financing, and commissioning and continued strong market conditions, and has hired Carester to support these REE separation initiatives.

About Energy Fuels: Energy Fuels is a leading
U.S.-based uranium mining company, supplying U₃O₈ to
major nuclear utilities. The Company also produces vanadium from certain of its
projects, as market conditions warrant, and is ramping up to full
commercial-scale production of RE Carbonate. Its corporate offices are in Lakewood,
Colorado near Denver, and all its assets and employees are in the
United States. Energy Fuels holds three of America’s key uranium production
centers: the White Mesa Mill in Utah, the Nichols Ranch ISR Project
in Wyoming, and the Alta Mesa ISR Project in Texas. The White Mesa Mill
is the only conventional uranium mill operating in the U.S. today, has a
licensed capacity of over 8 million pounds of U₃O₈ per
year, and has the ability to produce vanadium when market conditions warrant,
as well as RE Carbonate from various uranium-bearing ores. The Nichols Ranch
ISR Project is currently on standby and has a licensed capacity of 2 million
pounds of U₃O₈ per
year. The Alta Mesa ISR Project is also currently on standby and has a
licensed capacity of 1.5 million pounds of U₃O₈ per
year. In addition to the above production facilities, Energy Fuels also has one
of the largest S-K 1300 and NI 43-101 compliant uranium resource portfolios in
the U.S. and several uranium and uranium/vanadium mining projects on standby
and in various stages of permitting and development. The primary trading market
for Energy Fuels’ common shares is the NYSE American under the trading symbol
“UUUU,” and the Company’s common shares are also listed on the
Toronto Stock Exchange under the trading symbol “EFR.” Energy Fuels’
website is www.energyfuels.com.

Cautionary Note Regarding Forward-Looking Statements: This
news release contains certain “Forward Looking Information” and
“Forward Looking Statements” within the meaning of applicable United
States and Canadian securities legislation, which may include, but are not
limited to, statements with respect to: production and sales forecasts; costs
of production; any expectation that the Company will be awarded any sales under
the U.S. Uranium Reserve; scalability, and the Company’s ability and readiness
to re-start, expand or deploy any of its existing projects or capacity to
respond to any improvements in uranium market conditions or in response to the
Uranium Reserve; any expectation as to future uranium, vanadium, RE Carbonate
or REE market fundamentals or sales; any expectation as to recommencement of
production at any of the Company’s uranium mines or the timing thereof; any
expectation regarding any remaining dissolved vanadium in the Mill’s tailings
facility solutions or the ability of the Company to recover any such vanadium
at acceptable costs or at all; any expectation as to the ability of the Company
to secure any new sources of Alternate Feed Materials or other processing
opportunities at the Mill; any expectation as to timelines for the permitting
and development of projects; any expectation as to longer term fundamentals in
the market and price projections; any expectation as to the implications of the
current Russian invasion of Ukraine on uranium, vanadium or other
commodity markets; any expectation that the Company will maintain its position
as a leading uranium company in the United States; any expectation
with respect to timelines to production; any expectation that the Mill
will be successful in producing RE Carbonate on a full-scale commercial basis;
any expectation that Neo will be successful in separating the Mill’s RE
Carbonate on a commercial basis; any expectation that Energy Fuels will be
successful in developing U.S. separation, or other value-added U.S. REE
production capabilities at the Mill, or otherwise, including the timing of any
such initiatives and the expected production capacity or capital and operating
costs associated with any such production capabilities; any expectation that
the Company will restore U.S. rare earth separation capabilities in the coming
years; any expectation with respect to the future demand for REEs; any
expectation with respect to the quantities of monazite sands to be acquired by
Energy Fuels, the quantities of RE Carbonate to be produced by the Mill or the
quantities of contained TREO in the Mill’s RE Carbonate; any expectation that
any additional supplies of monazite sands will result in sufficient throughput
at the Mill to reduce underutilized capacity production costs and allow the
Company to realize its expected margins on a continuous basis; any expectation
that the Company will close the acquisition of the Bahia Project as scheduled
or at all; any expectation that the Bahia Project has the potential to feed the
Mill with REE and uranium-bearing monazite sand for decades; any expectation
that the Company will complete comprehensive sonic drilling and geophysical
mapping at the Bahia Project or complete an Initial Assessment under SK-1300
(U.S.) and a Preliminary Economic Assessment under NI 43-101 (Canada) during
Q4-2022 or Q1-2023, or otherwise; any expectation that the Company’s evaluation
of thorium and radium recovery at the Mill will be successful; any expectation
that the potential recovery of medical isotopes from any thorium and radium
recovered at the Mill will be feasible; any expectation that any thorium,
radium and other isotopes can be recovered at the Mill and sold on a commercial
basis; any expectation as to the quantities to be delivered under existing
uranium sales contracts, or that such contracts may help underpin the Company’s
uranium business for many years to come; any expectation that the Company will
be successful in completing any additional contracts for the sale of uranium to
U.S. utilities; any expectation that any existing or potential future uranium
sales contracts will be at prices and quantities that provide an appropriate
rate of return or sustain production and cover corporate overhead; any
expectation that the value of the Company’s investments accounted for at fair
value may improve in future periods; and any expectation that the Company will
generate net income in future periods. Generally, these forward-looking
statements can be identified by the use of forward-looking terminology such as
“plans,” “expects,” “does not expect,” “is
expected,” “is likely,” “budgets,” “scheduled,”
“estimates,” “forecasts,” “intends,”
“anticipates,” “does not anticipate,” or
“believes,” or variations of such words and phrases, or state that
certain actions, events or results “may,” “could,”
“would,” “might” or “will be taken,”
“occur,” “be achieved” or “have the potential
to.” All statements, other than statements of historical fact, herein are
considered to be forward-looking statements. Forward-looking statements involve
known and unknown risks, uncertainties and other factors which may cause the actual
results, performance or achievements of the Company to be materially different
from any future results, performance or achievements express or implied by the
forward-looking statements. Factors that could cause actual results to differ
materially from those anticipated in these forward-looking statements include
risks associated with: commodity prices and price fluctuations; processing and
mining difficulties, upsets and delays; permitting and licensing requirements
and delays; changes to regulatory requirements; legal challenges; the
availability of sources of Alternate Feed Materials and other feed sources for
the Mill; competition from other producers; public opinion; government and
political actions; available supplies of monazite sands; the ability of the
Mill to produce RE Carbonate to meet commercial specifications on a commercial
scale at acceptable costs; the ability of Neo to separate the RE Carbonate
produced by the Mill to meet commercial specifications on a commercial scale at
acceptable costs; market factors, including future demand for REEs; the ability
of the Mill to be able to separate radium or other radioisotopes at reasonable
costs or at all; market prices and demand for medical isotopes; and the other
factors described under the caption “Risk Factors” in the Company’s
most recently filed Annual Report on Form 10-K, which is available for review
on EDGAR at www.sec.gov/edgar.shtml,
on SEDAR at www.sedar.com, and on
the Company’s website at www.energyfuels.com.
Forward-looking statements contained herein are made as of the date of this
news release, and the Company disclaims, other than as required by law, any
obligation to update any forward-looking statements whether as a result of new
information, results, future events, circumstances, or if management’s
estimates or opinions should change, or otherwise. There can be no assurance
that forward-looking statements will prove to be accurate, as actual results
and future events could differ materially from those anticipated in such
statements. Accordingly, the reader is cautioned not to place undue reliance on
forward-looking statements. The Company assumes no obligation to update the
information in this communication, except as otherwise required by law.

SOURCE Energy Fuels Inc.

Monday, August 08, 2022

Energy Fuels (UUUU)
More signs that production is getting closer to ramping up

Energy Fuels is a leading U.S.-based uranium mining company, supplying U3O8 to major nuclear utilities. Energy Fuels also produces vanadium from certain of its projects, as market conditions warrant, and is ramping up commercial-scale production of REE carbonate. Its corporate offices are in Lakewood, Colorado, near Denver, and all its assets and employees are in the United States. Energy Fuels holds three of America’s key uranium production centers: the White Mesa Mill in Utah, the Nichols Ranch in-situ recovery (“ISR”) Project in Wyoming, and the Alta Mesa ISR Project in Texas. The White Mesa Mill is the only conventional uranium mill operating in the U.S. today, has a licensed capacity of over 8 million pounds of U3O8 per year, has the ability to produce vanadium when market conditions warrant, as well as REE carbonate from various uranium-bearing ores. The Nichols Ranch ISR Project is on standby and has a licensed capacity of 2 million pounds of U3O8 per year. The Alta Mesa ISR Project is also on standby and has a licensed capacity of 1.5 million pounds of U3O8 per year. In addition to the above production facilities, Energy Fuels also has one of the largest NI 43-101 compliant uranium resource portfolios in the U.S. and several uranium and uranium/vanadium mining projects on standby and in various stages of permitting and development. The primary trading market for Energy Fuels’ common shares is the NYSE American under the trading symbol “UUUU,” and the Company’s common shares are also listed on the Toronto Stock Exchange under the trading symbol “EFR.” Energy Fuels’ website is www.energyfuels.com.

Michael Heim, CFA, Senior Research Analyst, Noble Capital Markets, Inc.

Refer to the full report for the price target, fundamental analysis, and rating.

Energy Fuels reported 2022-2Q results in line with expectations, absent mark-to-market losses. The company reported a loss of $18.1 million or $0.11 per share. However, that included a $13.4 million negative mark to market of the value of investments. Absent that charge, adjusted net income would have been a loss of $4.7 million, or $0.03 per share, vs. our forecast for a loss of $8.6 million, or $0.06 per share.

Vanadium and Rare Earth Element (RRE) sales are modest but poised to expand. The company sold 575,000 lbs. of vanadium, almost twice our forecast at an average price of $13.44/lb. Pricing has dropped so the company has discontinued sales. UUUU sold 205 tonnes of RRE, in line with expectations and pricing. Energy Fuels continues to make strides towards assuring RRE supply and developing circuits to separate heavy and light RRE at its White Mesa facilities….

This Company Sponsored Research is provided by Noble Capital Markets, Inc., a FINRA and S.E.C. registered broker-dealer (B/D).

*Analyst certification and important disclosures included in the full report. NOTE: investment decisions should not be based upon the content of this research summary. Proper due diligence is required before making any investment decision. 

Monday, August 08, 2022

Permex Petroleum (OILCF)
Coverage initiated with an Outperform rating

Michael Heim, CFA, Senior Research Analyst, Noble Capital Markets, Inc.

Refer to the full report for the price target, fundamental analysis, and rating.

Company is at a growth inflection point. The company is about to begin a drilling program that could significantly grow its assets and cash flow generation. We anticipate the company to reach a position of being cash flow positive in 2023.  Permex has the capital already in place to begin its expansion. As of March 31, 2022, the company had C$8.4 million in cash and virtually no debt. We believe Permex has adequate capital at its disposal to begin the first stage of its drilling program.

Assets that were acquired in the down cycle are now worth significantly more.  Permex management seeks to acquire assets during energy downcycles (such as the period we witnessed in the late teens) and exploit them during the upcycles (such as we are currently witnessing). According to management, Permex acquired over 11,000 acres at an average price of approximately $2,000/acre in areas that have been sold recently for prices 20-30 times higher.

…

This Company Sponsored Research is provided by Noble Capital Markets, Inc., a FINRA and S.E.C. registered broker-dealer (B/D).

*Analyst certification and important disclosures included in the full report. NOTE: investment decisions should not be based upon the content of this research summary. Proper due diligence is required before making any investment decision. 

Friday, August 05, 2022

Alvopetro Energy (ALVOF)
Company update shows execution of game plan

Alvopetro Energy Ltd.’s vision is to become a leading independent upstream and midstream operator in Brazil. Our strategy is to unlock the on-shore natural gas potential in the state of Bahia in Brazil, building off the development of our Caburé natural gas field and our strategic midstream infrastructure.

Michael Heim, CFA, Senior Research Analyst, Noble Capital Markets, Inc.

Refer to the full report for the price target, fundamental analysis, and rating.

Management reported an update on production, drilling, and price adjustments. July sales volume averaged 2,514 boe/d. This is an increase over June sales of 2,480 and May sales of 2,111 (includes 5 day processing plant shutdown). June-quarter volumes were up 7% year over year. Production for the month of June equates to roughly 15 mmcf/d gas equivalent. Production is expected to increase beginning in August with the Cabure gas processing facility expanding to 18 mmcf/d capacity. 

Additional statistical interval data on recently-drilled wells looks favorable. The 183-B1 and 182-C1 wells both discovered potential net natural gas pay in multiple formations. Both wells are subject to testing. Both wells lie west of existing production in the Murucututu/Gomo project. The new field could be a critical component of Alvopetro’s long-term growth plans. On the Mururcututu project, the company is close to bringing a new well (183-1) to production and is extending pipeline to tie in another well (197-1) in the fourth quarter. New wells will help expand total production to the processing plant’s new capacity of 18 mmcf/d….

This Company Sponsored Research is provided by Noble Capital Markets, Inc., a FINRA and S.E.C. registered broker-dealer (B/D).

*Analyst certification and important disclosures included in the full report. NOTE: investment decisions should not be based upon the content of this research summary. Proper due diligence is required before making any investment decision. 

Alvopetro Announces Inaugural Sustainability Report, July 2022 Sales Volumes, & Operational Update

Research, News, and Market Data on Alvopetro Energy

Aug 04, 2022

CALGARY, AB, Aug. 4, 2022 /CNW/ – Alvopetro Energy Ltd. (TSXV: ALV) (OTCQX: ALVOF) announces our inaugural sustainability report for the year-ended December 31, 2021, July sales volumes and an operational update.

Inaugural Sustainability Report

We are pleased to present our inaugural 2021 Sustainability Report (the “Report”), highlighting the operational milestones achieved through the development of our Caburé project and outlining Alvopetro’s approach to environmental, social and governance (“ESG”) practices. The Report was approved by the Company’s Board of Directors and provides stakeholders insight into our environmental stewardship, community involvement and corporate governance practices. A full copy of the Report can be found on our website at https://alvopetro.com/Sustainability.

Corey Ruttan, President and Chief Executive Officer, commented: “Our goal while developing this sustainability report was to create transparency on how we manage our business objectives focused on innovation, business strength and our approach to sustainability by; responsibly supplying energy, strengthening communities and our workforce, and minimizing our impact.”

2021 ESG highlights included:

• Alvopetro’s locally produced natural gas resulted in average savings of 48% for consumers relative to imported LNG and 53% lower GHG emissions relative to fuel oil;
• 100% of produced water reinjected;
• Scope 1 & 2 emissions intensity of 4.7 kg CO₂e per boe;
• 65% less vegetation removed than allowed in our permit during the construction of our Murucututu pipeline extension;
• 75 jobs created during Murucututu pipeline construction;
• Zero lost-time safety incidents; and
• Budgeting $0.20/boe to voluntary social programs.

July Sales Volumes and Facility Expansion

Our July sales volumes averaged 2,514 boepd based on field estimates, including natural gas sales of 14.4 MMcfpd, associated natural gas liquids sales from condensate of 108 bopd and oil sales of 6 bopd, a 7% increase from our Q2 average of 2,359 boepd. Our Caburé gas processing facility expansion was commissioned and completed in late July. We now have available processing capacity of up to 500,000 cubic metres per day (18 MMcfpd).  Prior to the expansion our sales volumes were limited by the gas processing facility capacity. With the expanded capacity, our production is expected to be driven by Alvopetro’s share of available Caburé unit production and production additions from new projects. 

Operational Update

In April, we completed drilling our 182-C1 well on Block 182 and, based on open-hole wireline logs, the well discovered 25 metres of potential net natural gas pay in the Agua Grande formation with an average 34% water saturation and average porosity of 8.2%, using a 6% porosity cut-off, 50% Vshale cut-off and 50% water saturation cut-off.  We have commenced completion and testing operations using the drilling rig.  After perforating and cleaning up the well we will complete a 72-hour formation test.  We then plan to move the drilling rig on the same drilling location to drill a follow up well further east from the bounding fault to further assess the Agua Grande potential and to target the Sergi Formation.

In July, we completed drilling our second 2022 exploration well (183-B1) on the fault block immediately east to our 182-C1 discovery.  The 183-B1 location was also a multi-zone pre-rift prospect targeting both the Agua Grande and Sergi Formations.  Based on open-hole logs and collected fluid samples, the 183-B1 well encountered multiple zones of interest with an aggregate 34.3 metres of potential net hydrocarbon pay, using a 6% porosity cut-off, 50% Vshale cut-off and 50% water saturation cut-off.  Subject to equipment availability we expect to commence multi-zone formation tests later in the third quarter. 

On our Murucututu project, we commenced commissioning of our field production facility at our 183-1 location in July and subject to final ANP inspection we expect to have our 183-1 well on production near the end of the month. We also commenced field installation of the pipeline extension to tie-in our 197-1 well in June and expect construction to be completed later in the third quarter. Subject to receipt of regulatory approvals, we plan to complete and tie-in the 197-1 well in the fourth quarter.

At the Caburé Unit, the unit operator has commenced drilling the Unit C well (49.1% Alvopetro) targeting development and exploration potential in the Pojuca, Marfim and Caruaçu formations. Drilling is expected to be completed near the end of August.

Semi-Annual Natural Gas Price Redetermination

Pursuant to the terms of our long-term gas sales agreement with Bahiagás, our natural gas price effective August 1, 2022 is BRL1.94/m³ or $11.28/Mcf (based on our average heat content to date of 107% and the July 31, 2022 BRL/USD foreign exchange rate of 5.19).  The adjusted price is based on the ceiling price in the contract, which was adjusted to $10.22/MMBtu effective August 1, 2022. While the ceiling price increased by 6% from the February 1, 2022 ceiling price, due to the appreciation of the BRL relative to the USD in the first half of 2022 compared to the latter half of 2021, the BRL denominated contractual price remained consistent.  This price will be effective for all natural gas sales from August 1, 2022 to January 31, 2023.

Corporate Presentation

Alvopetro’s updated corporate presentation is available on our website at:http://www.alvopetro.com/corporate-presentation. 

Social Media

Follow Alvopetro on our social media channels at the following links:Twitter – https://twitter.com/AlvopetroEnergyInstagram – 
https://www.instagram.com/alvopetro/LinkedIn – 
https://www.linkedin.com/company/alvopetro-energy-ltdYouTube: https://www.youtube.com/channel/UCgDn_igrQgdlj-maR6fWB0w

Alvopetro Energy Ltd.’s vision is to become a
leading independent upstream and midstream operator in Brazil. Our
strategy is to unlock the on-shore natural gas potential in the state of Bahia
in Brazil,
building off the development of our Caburé natural gas field and our strategic
midstream infrastructure.

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 news release.

All amounts contained in this new release are in United States dollars,
unless otherwise stated and all tabular amounts are in thousands of United States dollars,
except as otherwise noted.

Abbreviations:

boepd                    
=             
barrels of oil equivalent (“boe”) per
daybopd                      
=             
barrels of oil and/or natural gas liquids (condensate) per
dayMMcf                     
=             
million cubic feetMMcfpd               
 
=             
million cubic feet per day

BOE Disclosure. The term barrels of oil
equivalent (“boe”) may be misleading, particularly if used in
isolation. A boe conversion ratio of six thousand cubic feet per barrel
(6Mcf/bbl) of natural gas to barrels of oil equivalence is based on an energy equivalency
conversion method primarily applicable at the burner tip and does not represent
a value equivalency at the wellhead. All boe conversions in this news release
are derived from converting gas to oil in the ratio mix of six thousand cubic
feet of gas to one barrel of oil.

Testing and Well Results.  Data obtained
from the 183-B1 and 182-C1 wells identified in this press release, including
hydrocarbon shows, open-hole logging, net pay and porosities, should be
considered to be preliminary until testing, detailed analysis and
interpretation has been completed. Hydrocarbon shows can be seen during the
drilling of a well in numerous circumstances and do not necessarily indicate a
commercial discovery or the presence of commercial hydrocarbons in a well.
There is no representation by Alvopetro that the data relating to the 183-B1
well nor the 182-C1 well contained in this press release is necessarily
indicative of long-term performance or ultimate recovery. The reader is
cautioned not to unduly rely on such data as such data may not be indicative of
future performance of the well or of expected production or operational results
for Alvopetro in the future.

Forward-Looking Statements and Cautionary Language. This
news release contains “forward-looking information” within the
meaning of applicable securities laws. The use of any of the words
“will”, “expect”, “intend” and other similar
words or expressions are intended to identify forward-looking information.
Forward?looking
statements involve significant risks and uncertainties, should not be read as
guarantees of future performance or results, and will not necessarily be
accurate indications of whether or not such results will be achieved. A number
of factors could cause actual results to vary significantly from the expectations
discussed in the forward-looking statements. These forward-looking statements
reflect current assumptions and expectations regarding future events.
Accordingly, when relying on forward-looking statements to make decisions,
Alvopetro cautions readers not to place undue reliance on these statements, as
forward-looking statements involve significant risks and uncertainties. More
particularly and without limitation, this news release contains forward-looking
information concerning potential hydrocarbon pay in the 183-B1 and the 182-C1
wells, exploration and development prospects of Alvopetro and the expected
timing of certain of Alvopetro’s testing and operational activities. The
forward?looking
statements are based on certain key expectations and assumptions made by
Alvopetro, including but not limited to expectations and assumptions concerning
testing results of the 183-B1 well and the 182-C1 well, equipment availability,
the timing of regulatory licenses and approvals, the success of future
drilling, completion, testing, recompletion and development activities, the
outlook for commodity markets and ability to access capital markets, the impact
of the COVID-19 pandemic, the performance of producing wells and reservoirs,
well development and operating performance, foreign exchange rates, general
economic and business conditions, weather and access to drilling locations, the
availability and cost of labour and services, environmental regulation,
including regulation relating to hydraulic fracturing and stimulation, the
ability to monetize hydrocarbons discovered, the regulatory and legal
environment and other risks associated with oil and gas operations. The reader
is cautioned that assumptions used in the preparation of such information,
although considered reasonable at the time of preparation, may prove to be
incorrect. Actual results achieved during the forecast period will vary from
the information provided herein as a result of numerous known and unknown risks
and uncertainties and other factors.  Although Alvopetro believes that the
expectations and assumptions on which such forward-looking information is based
are reasonable, undue reliance should not be placed on the forward-looking
information because Alvopetro can give no assurance that it will prove to be
correct. Readers are cautioned that the foregoing list of factors is not
exhaustive. Additional information on factors that could affect the operations
or financial results of Alvopetro are included in our annual information form
which may be accessed on Alvopetro’s SEDAR profile at www.sedar.com.
The forward-looking information contained in this news release is made as of
the date hereof and Alvopetro undertakes no obligation to update publicly or
revise any forward-looking information, whether as a result of new information,
future events or otherwise, unless so required by applicable securities laws.

SOURCE Alvopetro Energy Ltd.

 

Image Credit: Oregon State University

Investment Opportunities in Uranium and U.S. Nuclear Generation are Blossoming

The last time a nuclear reactor was certified in the U.S., Apple Computer had just introduced its first operating system, DOS 3.1.

Last week, nuclear power history was made as the Nuclear Regulatory Commission directed staff to issue a final rule certifying a small modular nuclear reactor. NuScale ($SMR) had submitted its application to the NRC back in 2016 to certify the company’s small modular reactor. The NRC staff met its goals and completed its technical review, and will be certifying its first commercial nuclear reactor in the U.S. since 1978.

 

About NuScale

NuScale was founded based on research funded by the United States Department of Energy (DOE). As funding for the research ended, scientists involved in the project obtained the necessary patents to develop the idea into a functioning product and company. Now, the NRC is about to fully certify NuScale’s first nuclear reactor. This reactor could be the first of a coming wave of advanced reactors, all riding a wave created by advanced technology and policies to move away from fossil fuels.

Source: Koyfin

The Future of Nuclear

The compact and modular design of NuScale’s nuclear generating system is a dramatic change from the large site-specific nuclear plants that utilities have been in service for over 40 years. NuScale’s light water reactor modules are roughly 65 feet tall. The company plans to build them in a factory and can distribute the pre-fab reactors globally. The first commercial reactor was a project that began in the early 2000s and could be a major step in changing how nuclear power is implemented.

The fact that so much time has elapsed since the NRC has approved a reactor, and this is the first advanced reactor design, had left enough uncertainty to make attracting investors difficult. Especially with such a long approval timeline. A new certification could foretell what the future of energy generation will include. Other companies that have SMR designs underway in the U.S. include Holtec and GE Hitachi, though none have yet submitted a design to the NRC.

The final certification to approve NuScale’s application filed in 2016 is expected soon. This first SMR power plant is expected to begin generating power in 2029, with all six of its modules due to come online by 2030. Located at the Idaho National Laboratory, the Carbon Free Power Project will generate some 462 MW, much of which is already contracted to be sold to power distribution companies for a 40-year period.

Paul Hoffman

Managing Editor, Channelchek

Suggested Content

Is the Future of Nuclear Power Small Modular Reactors?

Core Understanding of Nuclear Energy

How does the Gates Buffett Natrium Reactor Work?

The Increasing Popularity of Uranium Investments

Sources

https://www.nrc.gov/reactors/new-reactors/smr/nuscale.html

https://www.nrc.gov/reading-rm/doc-collections/news/2022/22-029.pdf

https://www.scientificamerican.com/article/first-new-nuclear-reactor-in-us-since-1978-approved/

https://www.computerhope.com/history/1978.htm#major-events

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Alaska Airlines and Gevo Enter into Sustainable Aviation Fuel Sales Agreement for 37 Million Gallons Per Year for Five Years

Research, News, and Market Data on Gevo

ENGLEWOOD, Colo., Aug. 03, 2022 (GLOBE NEWSWIRE) — Gevo, Inc. (NASDAQ: GEVO) is pleased to announce a new fuel sales agreement with Alaska Airlines (NYSE: ALK). The Agreement provides for Alaska Airlines to purchase 37 million gallons per year of sustainable aviation fuel (SAF) for five years through Gevo’s future commercial operations. Gevo’s SAF deliveries are expected to begin in 2026.

Alaska Airlines is a member of oneworld® global alliance (oneworld), and this agreement falls under the purview of a memorandum of understanding (MoU) that Alaska Airlines and Gevo signed in March 2022, laying the groundwork for the 14 world-class airlines in the alliance to potentially purchase 200 million gallons of SAF per year, from Gevo’s future commercial production operations. Gevo and Alaska Airlines previously partnered in 2016 to demonstrate the use of the first cellulosic renewable jet fuel specified for use on a commercial airline flight, produced from the sugars of wood waste. This Agreement with Alaska Airlines expands the list of committed airline partners and supports Gevo’s pursuit of its stated goal of producing and commercializing a billion gallons of SAF by 2030.

“As we continue to grow our partnerships with oneworld airlines, I’m personally gratified to see that Alaska Airlines has joined our list of partners,” said Gevo CEO Dr. Patrick Gruber. “Alaska was the first airline to fly on a Gevo experimental fuel that we made from the cellulosic fiber of wood waste, providing a pathway and proof that waste woods can be used to make sustainable aviation fuel. When Alaska Airlines receives fuel from one of our Net-Zero facilities, they will do so having been a part of some of our very important initial testing and delivery of sustainable aviation fuel.”

Alaska Airlines is committed to alternatives that assist in its goal of reducing emissions, including the use of greener alternatives and the prioritization of programs that help them safely burn less fuel. They have committed to pathways that will help them achieve net-zero carbon emissions by 2040, with the stated goal of being “the most sustainable and fuel-efficient U.S. airline.”

“Using sustainable aviation fuel is a significant part of Alaska’s five-part path to reach net zero carbon emissions, and we are excited about this agreement with Gevo – alongside our partners American Airlines and others in the oneworld alliance.” said Diana Birkett Rakow, senior vice president of public affairs and sustainability at Alaska Airlines. “We also recognize that there is significant work required ahead – including public policy action – to make SAF a viable, affordable option at scale.”

To make renewable jet fuel, Gevo utilizes waste starch (or sugars) from field corn that has been utilized in the production of high protein animal feed. These non-edible waste products are fermented into alcohol and then chemically converted to a renewable jet fuel through proprietary processes. This fuel is an ASTM tested and approved drop-in replacement for fossil-based jet fuel.

The Agreement with Alaska Airlines is subject to certain conditions, including Gevo developing, financing, and constructing one or more production facilities to produce the SAF contemplated by the Agreement.

About Gevo
Gevo’s mission is to transform renewable energy and carbon into energy-dense liquid hydrocarbons. These liquid hydrocarbons can be used for drop-in transportation fuels such as gasoline, jet fuel and diesel fuel, that when burned have potential to yield net-zero greenhouse gas emissions when measured across the full life cycle of the products. Gevo uses low-carbon renewable resource-based carbohydrates as raw materials, and is in an advanced state of developing renewable electricity and renewable natural gas for use in production processes, resulting in low-carbon fuels with substantially reduced carbon intensity (the level of greenhouse gas emissions compared to standard petroleum fossil-based fuels across their life cycle). Gevo’s products perform as well or better than traditional fossil-based fuels in infrastructure and engines, but with substantially reduced greenhouse gas emissions. In addition to addressing the problems of fuels, Gevo’s technology also enables certain plastics, such as polyester, to be made with more sustainable ingredients. Gevo’s ability to penetrate the growing low-carbon fuels market depends on the price of oil and the value of abating carbon emissions that would otherwise increase greenhouse gas emissions. Gevo believes that it possesses the technology and know-how to convert various carbohydrate feedstocks through a fermentation process into alcohols and then transform the alcohols into renewable fuels and materials, through a combination of its own technology, know-how, engineering, and licensing of technology and engineering from Axens North America, Inc., which yields the potential to generate project and corporate returns that justify the build-out of a multi-billion-dollar business.

Gevo believes that the Argonne National Laboratory GREET model is the best available standard of scientific-based measurement for life cycle inventory or LCI.

Learn more at Gevo’s website: www.gevo.com

About
Alaska Airlines
Alaska Airlines and its regional partners serve more than 120 destinations across the United States, Belize, Canada, Costa Rica and Mexico. It emphasizes Next-Level Care for its guests, along with providing low fares, award-winning customer service and sustainability efforts. Alaska is a member of the oneworld® global alliance. With the alliance and its additional airline partners, guests can travel to more than 1,000 destinations on more than 20 airlines while earning and redeeming miles on flights to locations around the world. Alaska Airlines and Horizon Air are subsidiaries of Alaska Air Group.

Learn more about Alaska Airlines here: alaskaair.com

Forward-Looking
Statements
Certain statements in this press release may constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements relate to a variety of matters, without limitation, including Gevo’s technology, the Agreement with Alaska Airlines, Gevo’s ability to develop, finance and construct one or more production facilities to produce the SAF contemplated by the Agreement with Alaska Airlines, the timing of Gevo producing the SAF for Alaska Airlines, the oneworld® Alliance, Gevo’s ability to produce SAF, the attributes of Gevo’s products, Gevo’s ability to create net-zero carbon intensity products, and other statements that are not purely statements of historical fact. These forward-looking statements are made on the basis of the current beliefs, expectations and assumptions of the management of Gevo and are subject to significant risks and uncertainty. Investors are cautioned not to place undue reliance on any such forward-looking statements. All such forward-looking statements speak only as of the date they are made, and Gevo undertakes no obligation to update or revise these statements, whether as a result of new information, future events or otherwise. Although Gevo believes that the expectations reflected in these forward-looking statements are reasonable, these statements involve many risks and uncertainties that may cause actual results to differ materially from what may be expressed or implied in these forward-looking statements. For a further discussion of risks and uncertainties that could cause actual results to differ from those expressed in these forward-looking statements, as well as risks relating to the business of Gevo in general, see the risk disclosures in the Annual Report on Form 10-K of Gevo for the year ended December 31, 2021, and in subsequent reports on Forms 10-Q and 8-K and other filings made with the U.S. Securities and Exchange Commission by Gevo.

Media
Contact
Heather L. Manuel
+1 303-883-1114
IR@gevo.com

InPlay Oil Corp. Announces Renewal of Credit Facility and Provides Operations Update

News and Market Data on InPlay Oil Corp

CALGARY, Alberta, July 26, 2022 (GLOBE NEWSWIRE) — InPlay Oil Corp. (TSX: IPO) (OTCQX: IPOOF) (“InPlay” or the “Company”) is pleased to provide an operations update and announce the completion of the annual renewal of its syndicated Senior Credit Facility.

Senior Credit Facility Renewal

InPlay’s Senior Credit Facility remains unchanged in lending capacity and has been renewed at $79 million comprised of a $65 million revolving facility⁽¹⁾ and the remaining $14 million term facility. The borrowing base of the revolving facility has been reconfirmed at the same amount of $65 million and the term out date extended to November 30, 2022. In addition to the Senior Credit Facility, the Company’s $25 million four year term facility with the Business Development Bank of Canada remains in place, providing InPlay with $104 million of total lending capacity.

Operations Update

During the second quarter, InPlay drilled three (3.0 net) 1.5 mile Extended Reach Horizontal (“ERH”) wells in Pembina which came on production at the end of May. The average combined initial production (“IP”) rates of these wells over the first thirty and sixty days of production was 1,501 boe/d⁽²⁾ (89% light crude oil and NGLs) and 1,441 boe/d⁽²⁾ (88% light crude oil and NGLs) respectively, based on field estimates. The Company also completed the drilling operations of an additional two (1.9 net) 2 mile ERH wells in Willesden Green which have currently been completed and are in the early cleanup period. Construction of a modular multi-well facility in Willesden Green began during the quarter to accommodate current and future drilling in the area.

Extreme wet weather in late June delayed the start of our third quarter capital program. The program has now started with drilling operations underway on the second well of a three (2.9 net) ERH well pad in Willesden Green which is expected to be on production in late August.

The Company’s released 2022 guidance⁽³⁾ is reiterated with field estimated average corporate production for the second quarter of 2022 of approximately 9,150 boe/d⁽²⁾ (59% light crude oil and NGLs) which includes over 5,000 bbls of a light crude oil inventory build due to difficulty trucking oil at the end of June.  This is 11% higher than production in the first quarter of 2022. Current corporate production is approximately 9,550 boe/d⁽²⁾ (60% light crude oil and NGLs) based on field estimates, which is 16% above our average production during the first quarter of 2022.

As a result of using a consistent drill crew since the beginning of the year and exceptional project execution, the two 2 mile ERH wells in Willesden Green were drilled in 10.3 and 10.7 days respectively, which were among the fastest drilling operations for 2 mile wells in the area. In comparison to the last 2 mile wells drilled by the Company in Willesden Green in 2018 drilling times improved by approximately 20% which is a positive result for the Company and is an example of InPlay’s continuous drive to achieve operational efficiencies.

We are extremely excited about the excellent financial position of the Company with our strong balance sheet, a strong portfolio of assets that are providing top-tier growth and our ability to generate long-term, direct returns to shareholders. Management would like to thank our employees, board members and lenders for their ongoing support as the Company progresses forward. The Company looks forward to announcing further corporate and operational updates including the upcoming release of our record second quarter results before markets on August 11, 2022.

For further information please contact:

Doug Bartole President and Chief Executive Officer InPlay Oil Corp. Telephone: (587) 955-0632

Darren Dittmer Chief Financial Officer InPlay Oil Corp. Telephone: (587) 955-0634

Notes:

• The
  revolving facility consists of a $10 million operating line of credit and $55
  million revolving line of credit.
• See “Reader
  Advisories – Production Breakdown by Product Type”.
• Refer to
  InPlay’s press release dated May 11, 2022 for full details of our 2022 capital
  program, associated guidance and key budget and underlying assumptions related
  thereto.

 

Reader Advisories

Forward-looking Information and Statements

This news release contains certain forward–looking information and statements within the meaning of applicable securities laws. The use of any of the words “expect”, “anticipate”, “continue”, “estimate”, “may”, “will”, “project”, “should”, “believe”, “plans”, “intends”, “forecast”, “targets”, “framework” and similar expressions are intended to identify forward-looking information or statements. In particular, but without limiting the foregoing, this news release contains forward looking information and statements pertaining to the following: expectations regarding future commodity prices; future oil and natural gas prices; future liquidity and financial capacity; future results from operations and operating metrics; future costs, expenses and royalty rates; future interest costs; the exchange rate between the $US and $Cdn; future development, exploration, acquisition, development and infrastructure activities and related capital expenditures, including our planned 2022 capital program and associated guidance.

Forward-looking statements or information are based on a number of material factors, expectations or assumptions of InPlay which have been used to develop such statements and information but which may prove to be incorrect. Although InPlay believes that the expectations reflected in such forward looking statements or information are reasonable, undue reliance should not be placed on forward-looking statements because InPlay can give no assurance that such expectations will prove to be correct. In addition to other factors and assumptions which may be identified herein, assumptions have been made regarding, among other things: the impact of increasing competition; the general stability of the economic and political environment in which InPlay operates; the timely receipt of any required regulatory approvals; the ability of InPlay to obtain qualified staff, equipment and services in a timely and cost efficient manner; drilling results; the ability of the operator of the projects in which InPlay has an interest in to operate the field in a safe, efficient and effective manner; the ability of InPlay to obtain debt financing on acceptable terms; field production rates and decline rates; the ability to replace and expand oil and natural gas reserves through acquisition, development and exploration; the timing and cost of pipeline, storage and facility construction and the ability of InPlay to secure adequate product transportation; future commodity prices; expectations regarding the potential impact of COVID-19 and the Russia/Ukraine conflict; currency, exchange and interest rates; regulatory framework regarding royalties, taxes and environmental matters in the jurisdictions in which InPlay operates; and the ability of InPlay to successfully market its oil and natural gas products. The forward-looking information and statements included herein are not guarantees of future performance and should not be unduly relied upon. Such information and statements, including the assumptions made in respect thereof, involve known and unknown risks, uncertainties and other factors that may cause actual results or events to defer materially from those anticipated in such forward-looking information or statements including, without limitation: the continuing impact of the COVID-19 pandemic and the Russia/Ukraine conflict; changes in our planned 2022 capital program; changes in commodity prices and other assumptions outlined herein; the potential for variation in the quality of the reservoirs in which we operate; changes in the demand for or supply of our products; unanticipated operating results or production declines; changes in tax or environmental laws, royalty rates or other regulatory matters; changes in development plans or strategies of InPlay or by third party operators of our properties; changes in our credit structure, increased debt levels or debt service requirements; inaccurate estimation of our light crude oil and natural gas reserve and resource volumes; limited, unfavorable or a lack of access to capital markets; increased costs; a lack of adequate insurance coverage; the impact of competitors; and certain other risks detailed from time-to-time in InPlay’s continuous disclosure documents filed on SEDAR including our Annual Information Form and our MD&A.

This press release contains future-oriented financial information and financial outlook information (collectively, “FOFI”) about InPlay’s prospective capital expenditures, all of which are subject to the same assumptions, risk factors, limitations, and qualifications as set forth in the above paragraphs. The actual results of operations of InPlay and the resulting financial results will likely vary from the amounts set forth in this press release and such variation may be material. InPlay and its management believe that the FOFI has been prepared on a reasonable basis, reflecting management’s best estimates and judgments. However, because this information is subjective and subject to numerous risks, it should not be relied on as necessarily indicative of future results. Except as required by applicable securities laws, InPlay undertakes no obligation to update such FOFI. FOFI contained in this press release was made as of the date of this press release and was provided for the purpose of providing further information about InPlay’s anticipated future business operations. Readers are cautioned that the FOFI contained in this press release should not be used for purposes other than for which it is disclosed herein.

The forward-looking information and statements contained in this news release speak only as of the date hereof and InPlay does not assume any obligation to publicly update or revise any of the included forward-looking statements or information, whether as a result of new information, future events or otherwise, except as may be required by applicable securities laws.

Production Breakdown by Product Type

Disclosure of production on a per boe basis in this press release consists of the constituent product types as defined in NI 51-101 and their respective quantities disclosed in the table below:

	Light and Medium Crude oil (bbls/d)		NGLS (boe/d)		Conventional Natural gas (Mcf/d)		Total (boe/d)
Corporate production	3,775		1,599		25,059		9,550
Q1 2022 Average Production	3,571		1,307		20,054		8,221
Q2 2022 Forecasted Average Production	3,872		1,419		23,154		9,150
Combined IP 30 – 3.0 net Q2/22 Pembina wells	793		163		3,270		1,501
Combined IP 60 – 3.0 net Q2/22 Pembina wells	681		175		3,510		1,441

Note:

• With respect
  to forward-looking production guidance, product type breakdown is based upon
  management’s expectations based on reasonable assumptions but are subject to
  variability based on actual well results.

References to crude oil, NGLs or natural gas production in this press release refer to the light and medium crude oil, natural gas liquids and conventional natural gas product types, respectively, as defined in National Instrument 51-101, Standards of Disclosure for Oil and Gas Activities (“Nl 51-101”).

BOE Equivalent
Barrel of oil equivalents or BOEs may be misleading, particularly if used in isolation. A BOE conversion ratio of 6 mcf: 1 bbl is based on an energy equivalency conversion method primarily applicable at the burner tip and does not represent a value equivalency at the wellhead. Given that the value ratio based on the current price of crude oil as compared to natural gas is significantly different than the energy equivalency of 6:1, utilizing a 6:1 conversion basis may be misleading as an indication of value.

 

Gevo Closes on Net-Zero 1 Production Facility Land in Lake Preston, SD, Plans Fall Groundbreaking

Research, News, and Market Data on Gevo

ENGLEWOOD, Colo., July 25, 2022 (GLOBE NEWSWIRE) — Gevo, Inc. (NASDAQ: GEVO) is pleased to announce closing on the purchase of approximately 245 acres near Lake Preston, South Dakota for its first commercial scale sustainable aviation fuel (SAF) facility, Net-Zero 1. The site initially optioned for purchase by Gevo in December of 2020, is very favorable for producing low-carbon SAF.

“After just over eighteen months of due diligence at the site, we are excited to commit and move forward. The potential of what we are creating here is, I think, immense. We are working to bring sustainable agriculture into the solution to capture carbon and catalyze the build-out of wind, renewable hydrogen, and biogas, combined with new paradigms for managing energy. I expect that Lake Preston and South Dakota will showcase what works well when all the parts unite. I want to get on with it and show people what is possible,” said Dr. Patrick Gruber, Gevo’s Chief Executive Officer. “Capturing renewable energy and transforming it into SAF and other liquid hydrocarbon fuels is game changing. It enables the transformation of renewable energy and carbon, in the form of liquids, to anywhere it is needed, and it can be done on a net-zero GHG lifecycle basis when all of the parts of the business system are accounted for. We expect that Middle America will continue to lead the energy transition.”

“The local availability of low-carbon corn as a feedstock for our process makes Lake Preston a favorable location for this operation,” said Tony Wells, Gevo’s Site Leader and General Manager. “Additionally, the local wind conditions are ideal for the wind power that will provide electricity to our plant, and there is a good local market for the high-protein animal feed product that we will be selling.”

Gevo expects to break ground on the project in September of 2022, with the formal announcement of a groundbreaking event for state and local representatives, and select members of the media, coming next month. The associated wind energy project that will provide electricity to the facility is in development. This project schedule should allow Gevo to begin delivery of initial volumes of SAF in 2025 to fulfill a portion of existing supply agreements. Net-Zero 1 is expected to produce 55 MGPY of SAF, or 62 MGPY of total hydrocarbon volumes.

About Gevo
Gevo’s mission is to transform renewable energy and carbon into energy-dense liquid hydrocarbons. These liquid hydrocarbons can be used for drop-in transportation fuels such as gasoline, jet fuel and diesel fuel, that when burned have potential to yield net-zero greenhouse gas emissions when measured across the full life cycle of the products. Gevo uses low-carbon renewable resource-based carbohydrates as raw materials, and is in an advanced state of developing renewable electricity and renewable natural gas for use in production processes, resulting in low-carbon fuels with substantially reduced carbon intensity (the level of greenhouse gas emissions compared to standard petroleum fossil-based fuels across their life cycle). Gevo’s products perform as well or better than traditional fossil-based fuels in infrastructure and engines, but with substantially reduced greenhouse gas emissions. In addition to addressing the problems of fuels, Gevo’s technology also enables certain plastics, such as polyester, to be made with more sustainable ingredients. Gevo’s ability to penetrate the growing low-carbon fuels market depends on the price of oil and the value of abating carbon emissions that would otherwise increase greenhouse gas emissions. Gevo believes that its proven, patented technology enabling the use of a variety of low-carbon sustainable feedstocks to produce price-competitive low-carbon products such as gasoline components, jet fuel and diesel fuel yields the potential to generate project and corporate returns that justify the build-out of a multi-billion-dollar business.

Gevo believes that the Argonne National Laboratory GREET model is the best available standard of scientific-based measurement for life cycle inventory or LCI.

Learn more at Gevo’s website: www.gevo.com

Forward-Looking
Statements
Certain statements in this press release may constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements relate to a variety of matters, without limitation, including Gevo’s ability to develop, finance, construct and operate commercial production facilities to produce the SAF, including Net-Zero 1 in Lake Preston, financial projections, the attributes of Gevo’s products, and other statements that are not purely statements of historical fact. These forward-looking statements are made on the basis of the current beliefs, expectations and assumptions of the management of Gevo and are subject to significant risks and uncertainty. Investors are cautioned not to place undue reliance on any such forward-looking statements. All such forward-looking statements speak only as of the date they are made, and Gevo undertakes no obligation to update or revise these statements, whether as a result of new information, future events or otherwise. Although Gevo believes that the expectations reflected in these forward-looking statements are reasonable, these statements involve many risks and uncertainties that may cause actual results to differ materially from what may be expressed or implied in these forward-looking statements. For a further discussion of risks and uncertainties that could cause actual results to differ from those expressed in these forward-looking statements, as well as risks relating to the business of Gevo in general, see the risk disclosures in the Annual Report on Form 10-K of Gevo for the year ended December 31, 2021, and in subsequent reports on Forms 10-Q and 8-K and other filings made with the U.S. Securities and Exchange Commission by Gevo.

Media
Contact
Heather L. Manuel
+1 303-883-1114
IR@gevo.com

 

Gevo Signs Sustainable Aviation Fuel Sales Agreement with American Airlines for 100 Million Gallons Per Year for Five Years

Research, News, and Market Data on Gevo

AGREEMENT
VALUED AT APPROXIMATELY $2.75 BILLION OVER FIVE YEARS

ENGLEWOOD, Colo., July 22, 2022 (GLOBE NEWSWIRE) — Gevo, Inc. (NASDAQ: GEVO) is pleased to announce a new fuel sales agreement with American Airlines, Inc. (NASDAQ: AAL). The agreement sets forth the terms for the sale of 100 million gallons per year of sustainable aviation fuel (SAF) for five years from Gevo’s future commercial operations. Gevo’s delivery of SAF under this agreement is expected to begin in 2026. Gevo estimates that the agreement should generate approximately $2.75 billion of revenue over the five-year term, inclusive of the value of environmental benefits. The Agreement with American Airlines is the single, largest fuel sales agreement ever entered into by Gevo with a customer.

American Airlines is a member of oneworld® global alliance (oneworld), and this agreement falls under the purview of memoranda of understanding (MoU) that oneworld members and Gevo signed earlier in 2022, laying the groundwork for the 14 world-class airlines in the alliance to purchase 200 million gallons of SAF per year, from Gevo’s future commercial operations. This SAF purchase agreement expands the list of committed airline partners and supports Gevo’s pursuit of its stated goal of producing and commercializing a billion gallons of SAF by 2030.

“The expansion of the global development of the SAF marketplace has reached an exciting point,” said Dr. Patrick R. Gruber, Gevo’s Chief Executive Officer. “While there is a tremendous amount of work to complete to bring all the critical elements of net-zero carbon SAF to the marketplace, our memoranda of understanding with oneworld alliance members and this subsequent commitment from American Airlines demonstrates the important momentum that is building for these types of products. I’m thrilled that Gevo is poised to continue to provide leadership for this product development.”

In September 2020, oneworld became the first global airline alliance to announce a target of carbon neutrality by 2050, establishing its commitment to long-term sustainability for the industry. The alliance followed up that commitment with an intermediate goal to achieve 10% SAF use across the member airlines by 2030.

“Today’s announcement is a historic step forward for American and our industry as we work to reduce our carbon footprint,” said Jill Blickstein, American’s Vice President of Sustainability. “The use of SAF is a cornerstone of our strategy to decarbonize air travel. While this landmark investment represents meaningful action by American Airlines, driving progress at the scale and pace we need requires critical policy action in Washington and at the State level. Alongside our 
oneworld partners, we’re proud to lead the way in the shift to SAF and make progress toward our shared climate goals.”

Further commenting on the agreement, Dr. Patrick R. Gruber, Chief Executive Officer of Gevo, said, “We are on a mission to drive greenhouse gasses out of the fuel supply chain with practical technology that can be scaled. In order to drive the GHG gasses out, we need renewable carbon and de-fossilized energy to power our production facilities. We know how to produce SAF. We know that by replacing fossil-based grid electricity with green electricity, replacing fossil-based natural gas with biogas, producing and using green hydrogen, and by working with farmers to improve the production of food while generating raw materials for SAF, we have a business system where incentives are aligned to improve sustainability and drive change. These take-or-pay SAF contracts help us show investors and lenders that this market is real, and merits investment to build plants for SAF. We are creating a new business system, one that can generate revenue for Gevo and attractive investment returns while also solving problems that impact all of us. By working together, we really can change the world. With these contracts in place, we hope to accelerate the journey.”

The agreement with American Airlines is subject to certain conditions precedent, including Gevo developing, financing, constructing and operating one or more production facilities to produce the SAF contemplated by the agreement. A copy of the agreement between American Airlines and Gevo will be filed with the U.S. Securities and Exchange Commission on Form 8-K no later than Friday, July 22, 2022.

About Gevo
Gevo’s mission is to transform renewable energy and carbon into energy-dense liquid hydrocarbons. These liquid hydrocarbons can be used for drop-in transportation fuels such as gasoline, jet fuel and diesel fuel, that when burned have potential to yield net-zero greenhouse gas emissions when measured across the full life cycle of the products. Gevo uses low-carbon renewable resource-based carbohydrates as raw materials, and is in an advanced state of developing renewable electricity and renewable natural gas for use in production processes, resulting in low-carbon fuels with substantially reduced carbon intensity (the level of greenhouse gas emissions compared to standard petroleum fossil-based fuels across their life cycle). Gevo’s products perform as well or better than traditional fossil-based fuels in infrastructure and engines, but with substantially reduced greenhouse gas emissions. In addition to addressing the problems of fuels, Gevo’s technology also enables certain plastics, such as polyester, to be made with more sustainable ingredients. Gevo’s ability to penetrate the growing low-carbon fuels market depends on the price of oil and the value of abating carbon emissions that would otherwise increase greenhouse gas emissions. Gevo believes that its proven, patented technology enabling the use of a variety of low-carbon sustainable feedstocks to produce price-competitive low-carbon products such as gasoline components, jet fuel and diesel fuel yields the potential to generate project and corporate returns that justify the build-out of a multi-billion-dollar business. Gevo believes that the Argonne National Laboratory GREET model is the best available standard of scientific-based measurement for life cycle inventory or LCI. Learn more at Gevo’s website: www.gevo.com

About
American Airlines Group
To Care for People on Life’s Journey®. Shares of American Airlines Group Inc. trade on Nasdaq under the ticker symbol AAL and the company’s stock is included in the S&P 500. Learn more about what’s happening at American by visiting news.aa.com and connect with American on Twitter @AmericanAir and at Facebook.com/AmericanAirlines.

Forward-Looking
Statements
Certain statements in this press release may constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements relate to a variety of matters, without limitation, including the agreement with American Airlines, Gevo’s ability to produce SAF, Gevo’s estimate of the revenue that might be generated from the agreement with American Airlines, the assumptions used to estimate potential revenue from the agreement, including, but not limited to future pricing of commodities and the future values of certain environmental benefits, Gevo’s technology, Gevo’s ability to develop, finance, construct and operate production facilities to produce SAF, the attributes of Gevo’s products, and other statements that are not purely statements of historical fact. These forward-looking statements are made on the basis of the current beliefs, expectations, and assumptions of the management of Gevo and are subject to significant risks and uncertainty. Investors are cautioned not to place undue reliance on any such forward-looking statements. All such forward-looking statements speak only as of the date they are made, and Gevo undertakes no obligation to update or revise these statements, whether as a result of new information, future events or otherwise. Although Gevo believes that the expectations reflected in these forward-looking statements are reasonable, these statements involve many risks and uncertainties that may cause actual results to differ materially from what may be expressed or implied in these forward-looking statements. For a further discussion of risks and uncertainties that could cause actual results to differ from those expressed in these forward-looking statements, as well as risks relating to the business of Gevo in general, see the risk disclosures in the Annual Report on Form 10-K of Gevo for the year ended December 31, 2021, and in subsequent reports on Forms 10-Q and 8-K and other filings made with the U.S. Securities and Exchange Commission by Gevo.

Media
Contact
Heather L. Manuel
+1 303-883-1114
IR@gevo.com

Image Credit: Andrew Gustar (Flickr)

What is Curtailment? An Electricity Market Expert Explains

Curtailment has a special meaning in electric power systems. It describes any action that reduces the amount of electricity generated to maintain the balance between supply and demand – which is critical for avoiding blackouts.

Recently, curtailment has made news in states like California and Texas that are adding a lot of wind and solar power. On very windy or sunny days, these sources may produce more electricity than the grid can take. So grid managers reduce production to manage that oversupply.

This can be a lost opportunity. Electricity from solar and wind, as well as existing nuclear plants, is inexpensive and emits less greenhouse gases than fossil fuels, so it may be in society’s interest to keep these generators running.

A Special Kind of Surplus

Consumers know about shortages and surpluses in the goods they buy. Shortages mean that shoppers can’t get that PlayStation 5 for Christmas – or, more critically, the bread, water or baby formula they need.

Surpluses look different, like unsold books classified as remainders or Easter candy discounted 80% at local drug stores on Monday morning.

But electricity is not like these goods. On today’s electric grid, shortages and surpluses can both result in the exact same thing – a blackout.

The North American grid transmits electricity as alternating current that changes direction back and forth, like water ebbing and flowing from a vintage hand pump as the handle is pushed up and down. Modern electricity grids require precise levels of frequency – the back-and-forth motion of power – to function properly.

The grid is designed to function at 60 hertz, which means that the flow of electric current shifts back and forth 60 times per second. This is achieved, in part, by ensuring that the amount of electricity produced at any given time is equal to the amount of electricity being used. If too little electricity is produced, frequency on the system drops. If too much electricity is produced, then frequency increases.

Modern power plants are designed to operate within a relatively narrow range around 60 hertz. If the actual frequency on the grid is outside that range, the plant can disconnect itself from the system. If enough plants do that, it causes a blackout.

As the U.S. electric power industry shifts increasingly to renewable sources, the national power grid will require major updates.

Managing the Flow

In some parts of the U.S., mostly the Southeast and the West, the same companies generate electricity and deliver it to customers. When power plants in a utility’s territory generate more electricity than customers are using, the company will simply produce less electricity from its most expensive power plant, or temporarily shut it off altogether.

But other states have restructured their electricity markets so that some companies produce power and others deliver it to customers. In these competitive markets, curtailment raises complex issues. Power generators stay in business by generating and selling power, so when demand drops, grid operators need a system to ensure that they make curtailment decisions fairly.

Often the first tool for choosing which plants to curtail is the prices that generators are paid. When supply grows or demand falls, the price of electricity falls. Some generators may decide that they are unwilling to produce electricity below a certain price and drop off if it hits that level.

If there’s still a power surplus, the organization that operates the grid steps in to manually curtail generators. They can either do this through signals in the grid’s data system or by contacting generators directly through phone calls. Power may be curtailed for five minutes or five hours, depending on how quickly the system returns to normal.

Overall, the U.S. needs more low-emissions electricity to help reduce air pollution and slow climate change. So curtailment isn’t a sound long-term strategy for managing power surpluses. It’s somewhat comparable to the early days of the COVID-19 pandemic when supply chain disruptions forced producers to throw away huge quantities of food even as grocery stores struggled to fill their shelves.

One solution is to expand energy storage so that generators can save excess power for a few hours instead of sending it straight into the grid. Another option is building more transmission to carry power to areas that need it. Both types of investments can reduce the need to curtail generation and forgo making clean, affordable electricity.

This article was republished with permission permission from  The Conversation, a news site dedicated to sharing ideas from academic experts. It represents the research-based findings and thoughts of Theodore J. Kury, Director of Energy Studies, University of Florida.

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Image Credit: Maureen (Flickr)

The Expected Slower Economy is Bringing Oil Prices Down

Oil is now below the level it was trading at on February 24 when Russia announced it would launch a “special military operation” within Ukraine. The price of oil dropped below $100 Bbl this week as an economic slowdown is built into the price models of commodity traders. Global growth forecasts were cut again on Wednesday (July 13) by the International Monetary Fund (IMF). This is the second growth forecast cut since April as the world’s economies face a myriad of risk factors. 

Source: Koyfin

One factor impacting IMF forecasts is the extreme pace of inflation in the US. A report of a Year-over-year pace of consumer inflation released this week shows prices have risen by 9.1% from June of last year. The actual pace of inflation has steepened in the past several months. Lower fuel prices, should they hold, may serve to temper the headline CPI number over the coming months.

However, the  Federal Reserve has indicated its resolve to stave off inflation by not taking half measures that prolong the problem. The acceleration of consumer prices has some economists and the futures market indicating some expect a full 100bp increase in overnight rates after the next meeting.

One of the advocates of a more aggressive Fed is Mohamed El-Erian, the Chief Economic Advisor at Allianz. El-Erian forecasted Wednesday that the Fed could raise interest rates by 100 basis points to stem historically high prices.

“The Fed now has no choice but to respond aggressively,” El-Erian wrote in a column for the Financial Times. “It is sure to increase interest rates by 0.75 percentage points later this month and could well consider a 1 percentage point rise.”

Meanwhile, those who wish to reduce Russian cash flow from petroleum sanctions may find the expected reduced demand due to a global recession a cause to rejoice. In 2021 Russia accounted for 13% of the world’s production of petroleum, the US produced 17%.

Drivers should find the price at the pumps level off some under the current conditions. If, however, the economic pace accelerates, the demand for oil may outstrip any spare production capacity they may have. This would push oil upward and could lead other prices even higher.

Take Away

Some self-correcting mechanisms in the world’s markets are creating an environment where slowing economies and forecasts for further slowing have caused commodities traders to reduce the prices they are willing to pay for oil. The lower prices and reduced demand could put a crimp on cash flow into the Russian economy.

Prices have dropped below the level they had been trading at before the war started. This could help slow the pace of inflation.

Paul Hoffman

Managing Editor, Channelchek

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https://www.reuters.com/markets/commodities/recession-would-make-tough-oil-sanctions-russia-more-likely-kemp-2022-07-14/

https://www.ft.com/content/f8185c63-72c0-479d-80e9-e9c0bf8eb8c5

https://markets.businessinsider.com/news/commodities/oil-price-today-crude-preinvasion-levels-100-recession-fears-economy-2022-7

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