InPlay Oil (IPOOF)(IPO:CA) – Capital Budget and Guidance In Line With Expectations

Thursday, January 14, 2021

InPlay Oil (IPOOF)(IPO:CA)
Capital Budget and Guidance In Line With Expectations

As of April 24, 2020, Noble Capital Markets research on InPlay Oil is published under ticker symbols (IPOOF and IPO:CA). The price target is in USD and based on ticker symbol IPOOF. Research reports dated prior to April 24, 2020 may not follow these guidelines and could account for a variance in the price target. InPlay Oil is a junior oil and gas exploration and production company with operations in Alberta focused on light oil production. The company operates long-lived, low-decline properties with drilling development and enhanced oil recovery potential as well as undeveloped lands with exploration possibilities. The common shares of InPlay trade on the Toronto Stock Exchange under the symbol IPO and the OTCQZ Exchange under the symbol IPOOF.

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

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

    Last week, IPO management set a 2021 capital budget of $23 million to drill 8 wells and projected average production of 5,100-5,400 boe/d. Our models assumed $25 million to drill 8 wells and production levels at the upper end of management’s range with an exit rate of 5,600 at yearend. The company drilled three wells in the fourth quarter all under 9 days each versus previous times of 9.0-9.5 days which explains lower-than-expected capital expenditures per well.

    Management projects adjusted funds flow of $30.5-$33.5 million in 2021.  This is above our model’s estimate of $29 million and reflects corporate and operating cost reductions of $8 million compared to the original January 2020 budget. The cost reductions come, in part, due to the securing of a $25 million second lien four-year loan facility with the Business Development Bank of Canada at a very …



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. 

Will the US Continue to Subsidize Renewable Energy Projects?

 


Renewable Projects Surge Following Subsidy Extension

 

Every month, the U.S. Energy Information Administration (EIA) surveys electric utilities to monitor planned generation projects. Over the last two months, there has been a surge in generation project announcements, with most of the projects being renewable energy. It is not unusual to see an uptick in the announcement of renewable projects at year-end, and the graph below had a similar look to the one twelve months ago. The year-end increase may represent management’s window dressing their generation plans. It is worth noting, however, that the announcements were accompanied by a renewal of tax subsidiaries for both wind and solar power last month. Wind production tax credits (PTCs) were extended twelve months for projects where construction has begun by December 31, 2021, and a new 30% investment tax credit has been created for offshore wind projects that start construction through 2025. A two-year extension for solar power PTCs was also passed at the same time. The shift towards renewable generation projects may also reflect rising natural gas and oil prices in recent months making traditional fossil fuel plant investments less attractive.

 

 

Renewable generation is growing in importance

Renewable generation represents only 11% of the nation’s generation load. However, that percent is growing rapidly, with renewable generation accounting for 70% of all new generation. The EIA projects that renewable energy will double to 22% of generation by 2030 and represent half of the nation’s generation load by 2050. The growth of renewable generations comes despite an expected sunsetting of subsidies.

 

 

Renewable generation costs are declining rapidly and are competitive without subsidies

The shift towards renewable generation follows a trend that we have seen in recent years as renewable generation costs declined. The International Renewable Energy Agency (IRENA) notes that solar photovoltaic prices have fallen 82% since 2010, while concentrated solar power has dropped 47%. Wind power costs have also decreased, albeit not as much.  Onshore wind costs have fallen 39%, while offshore wind costs have fallen 29%. The cost declines mean that wind and solar power have become a cheaper form of power generation than traditional fossil fuels.

 

 

Take-Away:

A debate regarding the government’s role in subsidizing production is a subject that can be debated. However, it is beyond the scope of this report. However, the result is the same – the subsidies given to renewable energy have allowed them to achieve the economies of scale needed to compete with fossil fuels. This will be true even if subsidies are removed.

 

Suggested Reading:

Energy 2020-4Q Review and Outlook -Dtd January 5, 2021

Is the Price for Uranium Rising?

Mergers Within the energy Industry are Heating Up

 

Sources:

https://www.greentechmedia.com/articles/read/solar-and-wind-tax-credit-extensions-energy-rd-package-in-spending-bill-before-congress#:~:text=The%20U.S.%20Congress%20on%20Monday,through%202025%20for%20offshore%20wind, Jeff St. John, GTM, December 22, 2020

https://www.windpowerengineering.com/ptc-extended-by-one-year-new-offshore-wind-tax-credit-inserted-in-congress-bill/#:~:text=The%20wind%20production%20tax%20credit,of%20its%20investment%20tax%20credit., WPED Staff, WPED, December 22, 2020

https://www.irena.org/newsroom/pressreleases/2019/May/Falling-Renewable-Power-Costs-Open-Door-to-Greater-Climate-Ambition, International Renewable Energy Agency, May 29, 2019


Indonesia Energy (INDO) Scheduled To Present at NobleCon17


Join Indonesia Energy (INDO) President Frank Ingriselli at NobleCon17 – Noble Capital Markets 17th Annual Small & Microcap Investor Conference – January 19&20, 2021. Following a formal presentation, a seasoned Wall Street research analyst will join Frank to moderate a LIVE Q&A session. If you want to be added to the roster of presenters… or if you would like to join the virtual audience of investors, at no cost, go to nobleconference.com.

NobleCon 17 Complete Presenting Company Schedule

enCore Energy Corp. (ENCUF)(EU:CA) – enCore Closes Westwater Resources Asset Acquisition

Wednesday, January 06, 2021

enCore Energy Corp. (ENCUF)(EU:CA)
enCore Closes Westwater Resources Asset Acquisition

enCore Energy Corp together with its subsidiary, is engaged in the acquisition and exploration of resource properties. The company holds the Marquez project in New Mexico as well as the dominant land position in Arizona with additional other properties in Utah and Wyoming. The firm also owns or has access to North American and global uranium data including the Union Carbide, US Smelting and Refining, UV Industries, and Rancher’s Exploration databases in addition to a collection of geophysical data for the high-grade Northern Arizona Breccia Pipe District.

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

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

    ENCUF announced that it has closed the acquisition of the uranium assets of Westwater Resources effective December 31, 2020. The acquisition includes two in-situ recover uranium production facilities and mineral exploration leases and rights in New Mexico and Texas. In exchange for the property, ENCUF will pay Westwater US$1.45 million in stock and grant it a 2.5% interest and 2% net smelter return royalty on mineral rights in New Mexico. Our models had assumed the transactions close and we have factored the higher share count.

    The deal was expected but is still an important catalyst for the stock to move higher.  The terms of the agreement match a previous Letter of Intent and the timing matches management’s guidance for a close by yearend. As such, the transaction was expected. Nevertheless, closing the transaction is a key catalyst for the company to begin producing uranium. We look for the company to now start signing …



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. 

Industry Report – Energy – 2020-4Q Review and Outlook

Tuesday, January 5, 2021

Energy Industry Report

Energy 2020-4Q Review and Outlook

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

Refer to end of report for Analyst Certification & Disclosures

  • Oil prices rose sharply beginning in November but are still well below levels at the start of the year. Oil prices continued to rebound from the sharp drop seen in the first quarter as investor enthusiasm about a Coronavirus vaccine pushed prices higher. WTI oil prices began the quarter in the mid thirties and finished the quarter near $47.50/BBL. Near-month oil futures prices are locked in a narrow range near current spot prices. Prices are still well below beginning-of-the-year prices near $60 per barrel.
  • Natural gas prices had risen but have fallen in recent weeks due to warm weather. Natural Gas prices also rose during the quarter although they have slipped in recent weeks. Recent weakness reflects significantly warmer-than-normal weather. Population-weighted heating degree days were 21% warmer than the 10-year trailing average in the month of November and similar to historical averages in December. As a result of warm weather, natural gas in storage ended the year at all-time high levels for this time of year and 2.6% above the trailing five-year average.
  • Energy stocks climbed 27% in the quarter mirroring the performance of oil prices. Energy stocks, as measured by the XLE Energy Index, rose alongside oil prices climbing 27% during the quarter. The rise began in November when oil prices rose. Even with the strong performance in the fourth quarter, however, the energy index was down 38% in 2020. This compares to a 14% rise in the overall market.
  • The near-term outlook for energy stocks has improved but we still have long-term concerns. The rebound in oil prices came faster than expected. We have been adjusting our models to reflect higher prices but are maintaining our long-term oil price forecast of $50 per barrel and $2.50 per mcf. Our near-term outlook for energy stocks has improved. We expect companies to report favorable results for the next few quarters unless rising production pushes energy prices lower. Longer-term, we have concern that oil demand will be constrained by power generation competition from renewable energy and decreased demand for gasoline and diesel due to a growth in electric vehicles. At the same time, supply pressure from an increasingly active OPEC and continued drilling productivity will mean lower energy prices.

Oil Prices

Oil prices continued to rebound from the sharp drop seen in the first quarter as investor enthusiasm about a Coronavirus vaccine pushed prices higher. WTI prices began the quarter in the mid thirties and finished the quarter near $47.50/BBL. Near-month oil futures prices are locked in a narrow range near current spot prices. Prices are still well below beginning-of-the-year prices near $60 per barrel. Interestingly, drilling had not resumed by the end of the year. Baker Hughes reported 351 active rigs in the United States as of December 31, less than half the number from a year ago. Consequently, domestic production has not changed. The U.S. Energy Information Administration (EIA) reports that domestic oil production rose a modest 2.7% between September and November (the last month available) and attributes the increase largely to hurricane-disrupted wells coming back online. We would expect to see production expand in upcoming months with increased drilling.

Natural Gas Prices 

Natural Gas prices also rose during the quarter although they have slipped in recent weeks. Recent weakness reflects significantly warmer-than-normal weather. Population-weighted heating degree days were 21% warmer than the 10-year trailing average in the month of November and similar to historical averages in December. As a result of warm weather, natural gas in storage ended the year at all-time high levels for this time of year and 2.6% above the trailing five-year average. Natural gas futures prices show prices rising modestly as the futures curve extends into the spring.


Energy Stocks 

Energy stocks, as measured by the XLE Energy Index, rose alongside oil prices climbing 27% during the quarter. The chart below shows that the strength in energy stocks began in November, the exact time that oil prices began to rise. The performance in the quarter far outpaced the overall market. Even with the strong performance in the fourth quarter, however, the energy index was down 38% in 2020. This compares to a 14% rise in the overall market.


Outlook 

The rebound in oil prices came faster than expected. We have been adjusting our models to reflect higher prices but are maintaining our long-term oil price forecast of $50 per barrel and $2.50 per mcf. Energy companies should start reporting positive cash flow at these prices and increasing drilling budgets. That said, marginal wells will most likely not be drilled, and production growth will be difficult unless we see prices rise back to a level near $60/bbl. and $3.00/mcf.  Companies must continue to work to lower costs to adjust to current prices by finetuning drilling techniques. 

Our near-term outlook for energy stocks has improved. We expect companies to report favorable results for the next few quarters unless rising production pushes energy prices lower. Longer-term, we have concern that oil demand will be constrained by power generation competition from renewable energy and decreased demand for gasoline and diesel due to a growth in electric vehicles. At the same time, supply pressure from an increasingly active OPEC and continued drilling productivity will mean lower energy prices. We recommend investors stay focused on energy companies with solid balance sheets, low operating costs and protected prices.

 

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ANALYST CREDENTIALS, PROFESSIONAL DESIGNATIONS, AND EXPERIENCE

Senior Equity Analyst focusing on energy and utility stocks. 24 years of experience as an analyst. Chartered Financial Analyst©. MBA from Washington University in St. Louis and BA in Economics from Carleton College in Minnesota. Named WSJ ‘Best on the Street’ Analyst four times. Named Forbes/StarMine’s “Best Brokerage Analyst” three times. FINRA licenses 7, 63, 86, 87.

WARNING

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Neither I nor anybody in my household has a financial interest in the securities of the subject company or any other company mentioned in this report.

NOBLE RATINGS DEFINITIONS % OF SECURITIES COVERED % IB CLIENTS
Outperform: potential return is >15% above the current price 78% 34%
Market Perform: potential return is -15% to 15% of the current price 5% 1%
Underperform: potential return is >15% below the current price 0% 0%

NOTE: On August 20, 2018, Noble Capital Markets, Inc. changed the terminology of its ratings (as shown above) from “Buy” to “Outperform”, from “Hold” to “Market Perform” and from “Sell” to “Underperform.” The percentage relationships, as compared to current price (definitions), have remained the same.

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Report ID: 11924

Gevo, Inc. (GEVO) – Two milestones in a week – FEED Engineering firm identified

Tuesday, January 05, 2021

Gevo, Inc. (GEVO)
Two milestones in a week – FEED Engineering firm identified

Gevo Inc is a renewable chemicals and biofuels company engaged in the development and commercialization of alternatives to petroleum-based products based on isobutanol produced from renewable feedstocks. Its operating segments are the Gevo segment and the Gevo Development/Agri-Energy segment. By its segments, it is involved in research and development activities related to the future production of isobutanol, including the development of its biocatalysts, the production and sale of biojet fuel, its Retrofit process and the next generation of chemicals and biofuels that will be based on its isobutanol technology. Gevo Development/Agri-Energy is the key revenue generating segment which involves the operation of the Luverne Facility and production of ethanol, isobutanol and related products.

Poe Fratt, Senior Research Analyst, Noble Capital Markets, Inc.

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

    Another milestone hit with identification of FEED firm. Koch Project Solutions, LLC is performing front end engineering, design and project execution management services (FEED) for the renewable fuel expansion projects. Koch Project Solutions is part of a subsidiary of Koch Industries. Like Trafigura, the new relationship could open up collaboration opportunities on other fronts. While there is no indication that other subs are involved, establishing a relationship with a major energy industry player should be viewed as a positive development.

    Debt free milestone hit.  Strong December stock price performance was catalyst for debt conversion into equity. Last week, we learned from an ATM equity prospectus update that all of the convert debt was converted into equity. A total of 5.67 million shares were issued to Whitebox, and ~$14 million of cash was preserved to keep current cash near $79 million …



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. 

Capstone Turbine Corporation (CPST) Scheduled To Present at NobleCon17


Join Capstone Turbine (CPST) CEO Darren Jamison & CFO Eric Hencken at NobleCon17 – Noble Capital Markets 17th Annual Small & Microcap Investor Conference – January 19&20, 2021. Following a formal presentation, a seasoned Wall Street research analyst will join Darren and Eric to moderate a LIVE Q&A session. If you want to be added to the roster of presenters… or if you would like to join the virtual audience of investors, at no cost, go to nobleconference.com.

NobleCon 17 Complete Presenting Company Schedule

InPlay Oil (IPOOF)(IPO:CA) Scheduled To Present at NobleCon17


Join InPlay Oil (IPOOF)(IPO:CA) CEO Doug Bartole at NobleCon17 – Noble Capital Markets 17th Annual Small & Microcap Investor Conference – January 19&20, 2021. Following a formal presentation, a seasoned Wall Street research analyst will join Doug to moderate a LIVE Q&A session. If you want to be added to the roster of presenters… or if you would like to join the virtual audience of investors, at no cost, go to nobleconference.com.

NobleCon 17 Complete Presenting Company Schedule

Indonesia Energy Corp (INDO) – Shares surge 47 percent on rising oil prices

Thursday, December 31, 2020

Indonesia Energy Corp (INDO)
Shares surge 47% on rising oil prices

Indonesia Energy Corp Ltd is an oil and gas exploration and production company focused on Indonesia. It holds two oil and gas assets through its subsidiaries in Indonesia: one producing block (the Kruh Block) and one exploration block (the Citarum Block). The Kruh Block is located to the northwest of Pendopo, Pali, South Sumatra. The Citarum Block is located to the south of Jakarta.

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

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

    The shares of INDO rose 47% on December 30 on heavy volume. The shares of INDO opened at $5.74 and quickly rose to $15.33 before ending the day at $7.11. The company did not report any news that might account for the rise in its stock. We would note that management gave an update on operations on November 23 and presented at a conference for microcap stocks on December 10. The shares of INDO are thinly traded with less than 1 million shares traded on average. More than 50 million shares were traded on Wednesday with most of the trades executed before noon.

    Oil prices have been rising.  Brent oil prices have been rising since the beginning of November and are now above $51 per barrel. The price INDO receives for oil production follows a complicated formula but generally tracks Brent oil prices. Current prices are above that assumed in our models which call for an average price of $45 in 2021 and $50 in 2022 and beyond. Drilling has been delayed into …



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. 

Gevo, Inc. (GEVO) – Debt free with higher pro forma cash balance moving into 2021

Thursday, December 31, 2020

Gevo, Inc. (GEVO)
Debt free with higher pro forma cash balance moving into 2021

Gevo Inc is a renewable chemicals and biofuels company engaged in the development and commercialization of alternatives to petroleum-based products based on isobutanol produced from renewable feedstocks. Its operating segments are the Gevo segment and the Gevo Development/Agri-Energy segment. By its segments, it is involved in research and development activities related to the future production of isobutanol, including the development of its biocatalysts, the production and sale of biojet fuel, its Retrofit process and the next generation of chemicals and biofuels that will be based on its isobutanol technology. Gevo Development/Agri-Energy is the key revenue generating segment which involves the operation of the Luverne Facility and production of ethanol, isobutanol and related products.

Poe Fratt, Senior Research Analyst, Noble Capital Markets, Inc.

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

    Strong December stock price performance proved catalyst for debt conversion into equity. ATM program updated for opportunistic use.  In the updated ATM equity prospectus, we learned that the convert debt was fully converted into equity after strong stock price performance in December and 5.67 million shares were issued to Whitebox to retire the convert debt, including PIK interest and a make whole payment. About $14 million of cash was preserved and current cash is $79 million. In 4Q2020, ATM equity issuance raised $6.2 million and warrant exercises added ~$0.4 million.

    Potential milestones/catalysts over the next year: Expanding the supply contract portfolio with new industry/financial partners; Identifying engineering firm performing FEED work; Identifying equity and debt project financing partners; Awarding an EPC (Engineering/Procurement/Construction) contract to a construction firm; Financial closing of project debt/equity financing that allows the …



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. 

What Should the Price Range Be for Oil and Gas?

 


Well Productivity Improvements – Good for Producers, Bad for Energy Prices

 

Oil well production and improved drilling efficiency could keep the price per barrel low, even as demand picks up. Although today’s lower oil price range is largely demand-related, the result of pandemic related slowdowns, technology has been improving well output, this is also a culprit. The trend is also impacting natural gas.  Technology is not likely to reverse itself and reduce the capacity to bring oil to the surface. From a supply standpoint, oil prices could be stuck in a lower range, even in a booming economy.

Where the Growth in Oil Production is Greatest

A recent study by the U.S. Energy Information Administration shows that technology improvements in the last decade have not only increased the overall production of oil and gas in the United States they have also dramatically increased production rates per well. To show this graphically, the EIA separated production into categories based on the size of the well. The graph below shows that the growth in oil production has occurred primarily from wells producing 100-1600 barrels of oil equivalent (BOE) per day. Interestingly, there has not been much growth in the number of production of large wells producing more than 3,200 BOE/day. The limited growth from “mega wells” reflects a decreased emphasis on drilling in the Gulf of Mexico and searching for giant discoveries. It is also worth noting that there has been little growth among smaller wells. These largely represent existing wells that have been in production for many years at steady rates.

 

 

Where the Growth in Natural Gas Production is Greatest

A similar story can be told by looking at natural gas well production.  The growth has come from the middle size wells and not the largest or smallest producing wells. Notably, the production growth has come during a period of low natural gas prices and does not yet reflect the impact of a rebound in natural gas prices in the second half of 2020.

 

 

Improved Drilling Methods

The growth in oil and natural gas production should come as no surprise. Horizontal drilling and fracking have improved initial productivity rates of middle-size wells. What is perhaps a surprise is the fact that improvements seem to be accelerating in recent years. Horizontal drilling began in the ‘70s, and fracking has been done for over 150 years, but it wasn’t until ten years ago that the use of horizontal drilling and fracking surged in the United States. Importantly, drillers continue to improve well production rates by finetuning the number and spacing of fracks per well, and the amount of pressure and viscosity used to frack a well. To complicate matters, the ideal drilling formula in one land formation may not work in another land formation. This has lead to a growth of producers that specialize in specific drilling locations.

 

 

It is a common theme among producers to report well production that surpasses expected “type curves”. At the same time, managements report a reduction in the number of days it takes to drill a well and thus its overall drilling cost. The result of reduced well cost and higher production has meant a higher return on investment. Higher returns have helped offset lower energy prices in 2019 and the first half of 2020.

Take-Away

Improved profitability is clearly positive for individual energy companies. As a whole, however, it means lower energy prices.  Drilling can continue at lower energy prices than before, and drilling will increase sooner when prices rise. If the natural trading range of oil was previously $40-$70 per barrel, perhaps the new range is now $30-$60 per barrel. And, for natural gas, perhaps the range has shifted from $2.50-$3.50 per mcf to $2.00-$3.00 per mcf. If true, current prices of $48 for oil and $2.40 for natural gas do not represent depressed levels but levels in the middle of the new trading ranges. And technology continues to improve. Ten years from now, we may be talking about even lower trading ranges. Technology is not going to reverse itself and cause trading ranges to rise.

 

Suggested Reading:

Small-Cap Energy Underperformance During the Drop in Oil is Unwinding

Are we headed to Another Oil Collapse?

Will Oil Prices Rise
in 2021?

 

Sources:

https://www.hartenergy.com/news/history-horizontal-directional-drilling-52314., Hart Energy, September 1, 2005

https://www.nrdc.org/stories/fracking-101#history, NRDC, April 19, 2019

 

enCore Energy (ENCUF)(EU:CA) Scheduled To Present at NobleCon17


Join enCore Energy (ENCUF)(EU:CA) Executive Chairman William Sheriff & CEO Paul Goranson at NobleCon17 – Noble Capital Markets 17th Annual Small & Microcap Investor Conference – January 19&20, 2021. Following a formal presentation, a seasoned Wall Street research analyst will join William and Paul to moderate a LIVE Q&A session. If you want to be added to the roster of presenters… or if you would like to join the virtual audience of investors, at no cost, go to nobleconference.com.

NobleCon 17 Complete Presenting Company Schedule

Release – Energy Fuels (UUUU) – Applauds $75 Million Launch of the U.S. Uranium Reserve in Bipartisan 2021 Omnibus Spending Bill

 

 


Energy Fuels Applauds $75 Million Launch of the U.S. Uranium Reserve in Bipartisan 2021 Omnibus Spending Bill

 

LAKEWOOD, Colo., Dec. 22, 2020 /CNW/ – Energy Fuels Inc. (NYSE American: UUUU) (TSX: EFR) (“Energy Fuels” or the “Company”) the largest uranium miner in the U.S., applauds the bipartisan, bicameral launch of the U.S. uranium reserve, as $75 million of funding was included in the omnibus appropriation bill passed by both houses of Congress last night. Appropriating funding for a U.S. uranium reserve was one of the main recommendations of the U.S. Nuclear Fuel Working Group, which was directed to make recommendations on securing the domestic capacity to produce uranium and nuclear fuel. This key funding opens the door for the U.S. government to purchase domestically-produced uranium to guard against potential commercial and national security risks presented by our country’s near-total reliance on foreign imports of uranium. The bill is expected to be sent to the President for signature in the coming days.

Energy Fuels has been the number one uranium miner in the U.S. since 2017, and the projects the Company now owns and operates have produced roughly one-third of all uranium mined in the U.S. since 2006, ranking second among all U.S. uranium producers during that period. Energy Fuels holds three (3) of the most productive uranium facilities in the U.S., which together have a combined licensed capacity to produce over 11.5 million pounds of uranium per year. This includes the White Mesa Mill, located in southeast Utah, which is the only conventional uranium mill operating in the U.S. today, along with the Nichols Ranch and Alta Mesa in situ recovery (“ISR”) facilities, located in Wyoming and Texas respectively, both of which are on standby. The Company is therefore in an unmatched position and stands ready to supply uranium for the reserve.

Mark S. Chalmers, President and CEO of Energy Fuels stated: “Energy Fuels extends our gratitude to Congress and the Administration for working together on a bipartisan basis to appropriate these funds in 2021 for the creation of a U.S. uranium reserve. We are extremely pleased to see members on both sides of the aisle support a healthy domestic uranium industry, so America cannot be held hostage by foreign adversaries like Russia for the fuel needed to generate clean, carbon-free nuclear energy. This funding also has the potential to create good-paying jobs and economic opportunity for under-served areas of Wyoming, Texas and Utah. We wish to extend a particular thank you to Wyoming Senator John Barrasso, a tireless champion for the U.S. uranium industry and a true advocate for ending America’s dependence on foreign adversaries for the critical minerals we need today.

“Creation of a uranium reserve is truly a milestone for our industry, and $75 million will go a long way toward reviving and expanding the domestic production of nuclear fuel in 2021 and beyond. We look forward to working with the U.S. Department of Energy to make sure this funding is spent wisely to support existing infrastructure by purchasing uranium from existing, proven uranium facilities.

“Our White Mesa Mill in Utah is a clean energy and critical minerals hub, a concept that goes much farther than simply mining and producing uranium. Any funds used through a Department of Energy program to purchase uranium from the White Mesa Mill can have a ‘multiplier effect’, by not only supporting the domestic uranium mining industry, but also by advancing other important clean energy priorities, including rare earth production, abandoned mine cleanup and supporting Native American communities.

“Energy Fuels, and particularly our White Mesa Mill, is one of the best untold clean energy stories in the U.S. today. The U.S. uranium reserve can help revive domestic uranium production, while also accelerating other important initiatives that play a part in making the world a cleaner and healthier place.”

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 anticipates commencing commercial production of rare earth element (“REE”) carbonate in 2021. Its corporate offices are in Lakewood, Colorado, near Denver, and all of 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, and is completing final test-work for the production of 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.

Cautionary Note Regarding Forward-Looking Statements: This news release contains certain “Forward Looking Information” and “Forward Looking Statements” within the meaning of applicable securities legislation, which may include, but is not limited to, statements with respect to: the Company being a leading producer of uranium in the U.S.; any expectation that the Company is able to produce REE carbonate from uranium-bearing ores or that the Company will commence commercial production of REE carbonate in 2021 or at all; any expectation that the Company’s REE project may, in time, result in among the lowest cost REE production in the western world; any expectation that the Company will be successful in acquiring additional supplies of monazite, or will be successful in processing other types of REE- and uranium bearing ores at the White Mesa Mill; any expectation that the Company will be successful in achieving its goal of processing 15,000+ tons of monazite and other sources of ore per year; any expectation that the Company will be able to sell some or all of its REE carbonate to buyers in Europe and/or Asia until a REE separation facility is established in the United States; any expectation that the Company may potentially perform separation, and other downstream REE activities including metal-making and alloying, in the future at the White Mesa Mill or elsewhere in the United States; any expectation that the Company will be successful in helping the EPA and Navajo Nation address historic abandoned uranium mines; any expectation that the Company will significantly increase the number of green jobs it is providing at the White Mesa Mill; and any other statements regarding Energy Fuels’ future expectations, beliefs, goals or prospects; constitute forward-looking information within the meaning of applicable securities legislation (collectively, “forward-looking statements”). All statements in this news release that are not statements of historical fact (including statements containing the words “expects,” “does not expect,” “plans,” “anticipates,” “does not anticipate,” “believes,” “intends,” “estimates,” “projects,” “potential,” “scheduled,” “forecast,” “budget” and similar expressions) should be considered forward-looking statements. All such forward-looking statements are subject to important risk factors and uncertainties, many of which are beyond Energy Fuels’ ability to control or predict. A number of important factors could cause actual results or events to differ materially from those indicated or implied by such forward-looking statements, including without limitation factors relating to: the Company being a leading producer of uranium in the U.S.; any expectation that the Company is able to produce REE carbonate from uranium-bearing ores or that the Company will commence commercial production of REE carbonate in 2021 or at all; any expectation that the Company’s REE project may, in time, result in among the lowest cost REE production in the western world; any expectation that the Company will be successful in acquiring additional supplies of monazite, or will be successful in processing other types of REE- and uranium bearing ores at the White Mesa Mill; any expectation that the Company will be successful in achieving its goal of processing 15,000+ tons of monazite and other sources of ore per year; any expectation that the Company will be able to sell some or all of its REE carbonate to buyers in Europe and/or Asia until a REE separation facility is established in the United States; any expectation that the Company may potentially perform separation, and other downstream REE activities including metal-making and alloying, in the future at the White Mesa Mill or elsewhere in the United States; any expectation that the Company will be successful in helping the EPA and Navajo Nation address historic abandoned uranium mines; any expectation that the Company will significantly increase the number of green jobs it is providing at the White Mesa Mill; and the other risk factors as described in Energy Fuels’ most recent annual report on Form 10-K and quarterly financial reports. Energy Fuels assumes no obligation to update the information in this communication, except as otherwise required by law. Additional information identifying risks and uncertainties is contained in Energy Fuels’ filings with the various securities commissions, which are available online at www.sec.gov and www.sedar.com. Forward-looking statements are provided for the purpose of providing information about the current expectations, beliefs and plans of the management of Energy Fuels relating to the future. Readers are cautioned that such statements may not be appropriate for other purposes. Readers are also cautioned not to place undue reliance on these forward-looking statements, that speak only as of the date hereof.

SOURCE Energy Fuels Inc.

For further information: Investor Inquiries: Energy Fuels Inc.: Curtis Moore, VP – Marketing and Corporate Development, (303) 974-2140 or Toll free: (888) 864-2125, investorinfo@energyfuels.com; www.energyfuels.com