Energy Fuels estimates $1.8B value for Madagascar mineral sands project

Power Gas ( NYSE: UUUU) (TSX: EFR) has actually launched an upgraded usefulness research study (FS) for its 100%- possessed hefty mineral sands (HMS) task in Madagascar, highlighting its solid business economics and prospective to be a factor to the international unusual planet supply chain.

The task, Vara Mada, was gotten by the firm in 2024 with its requisition of Australia’s Base Resources. At the time, Power Fuels fixed the task (after that referred to as Toliara) as a significant resource of monazite, a phosphate mineral which contains unusual planet components. It likewise mentioned the task’s prospective result of ilmenite and zircon, which are resources of titanium and zirconium specifically.

The FS record approximated that the Vara Mada can create about 959,000 tonnes of ilmenite, 66,000 tonnes of zircon and 24,000 tonnes of monazite, plus 8,000 tonnes of rutile, a normally taking place titanium dioxide mineral. The task has actually an at first designed mine life of 38 years, with the prospective to boost adhering to improvements and additional boring.

Based upon these projections and a present source price quote for the Ranobe down payment, the FS offered the Vara Mada an after-tax web existing worth (at 10% price cut) of $1.8 billion– relating to $7.30 per share– and an inner price of return of 24.9%.

” The FS verifies what we have actually understood because we obtained the task in 2024. Vara Mada is a generational, unique task that has the prospective to favorably modify the characteristics of international unusual planet and essential mineral supply chains,” Mark Chalmers, Chief Executive Officer of Power Fuels, stated in a press release Thursday.

Shares of Power Fuels increased as long as 2% in New york city adhering to the FS launch, sending its market capitalization to $4.5 billion.

Resource of unusual planet oxides

In its news release, Power Fuels stated Vara Mada acts as an essential component of its varied essential products service focused around its White Mesa mill in Utah.

As soon as in manufacturing, monazite product from Vara Mada would certainly be carried to White Mesa for additional handling right into light and hefty unusual planet oxides. The center is just working uranium mill in the United States, however has the capacity to procedure monazite right into unusual planet oxides.

” Monazite focuses generated from Vara Mada, and various other HMS tasks worldwide, are an abundant resource of both light and hefty ‘magnet’ REEs, utilized in a range of tidy power and progressed modern technologies, consisting of electrical and hybrid lorries, progressed robotics and production, customer electronic devices, renewable resource, and essential protection modern technologies,” Chalmers kept in mind.

Under its present “Stage 1” ability, the White Mesa mill can refine as much as 10,000 tonnes of monazite concentrate annually right into as much as 1,000 tonnes of neodymium-praseodymium (NdPr) oxide. Power Fuels has strategies to increase its handling capacities right into hefty unusual planets, generating as much as 48 tonnes of dysprosium and 14 tonnes of terbium oxides. The increased center, it states, can be functional as quickly as the 4th quarter of 2026.

Along with monazite generated at its various other HMS tasks, the overall unusual planet manufacturing can provide as much as 30% people need for light REE oxides and 85% people need for hefty REE oxides, Power Fuels stated, mentioning Criteria Mineral Knowledge’s supply projection.

Last financial investment choice

As kept in mind by Power Fuels, a last financial investment choice (FID) on the Vara Mada task would certainly need the formalization of particular monetary terms, consisting of the enhancement of monazite manufacturing to the existing mining license. The firm and the federal government of Madagascar are still in arrangements based upon the formerly divulged memorandum of comprehending authorized by the events in December 2024, it stated.

In the usefulness record, the pre-FID resources prices for the task is approximated at $121 million, while the post-FID resources prices would certainly amount to over $900 million over 2 phases.