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The Roca Honda Project is an Advanced stage, conventional uranium project located in New Mexico, USA, approximately three miles northwest of San Mateo, New Mexico and covers approximately 4,440 acres. The Roca Honda Project is 100% owned by Strathmore Resources (US) Ltd. ("Strathmore Resources"), a wholly-owned subsidiary of Energy Fuels Inc. (“Energy Fuels”). Energy Fuels also owns the White Mesa Mill, an existing conventional uranium mill located near Blanding, Utah, USA, approximately 275 miles from the Roca Honda Project.

Unless otherwise indicated, the scientific and technical information herein regarding the Roca Honda Project has been derived from the Technical Report Summary (“TRS”) titled "Technical Report on the Roca Honda Project, McKinley County, New Mexico, USA" with an effective date of February 22, 2022 (the "Roca Honda Technical Report"), prepared for Energy Fuels and Energy Fuels' other public disclosures, copies of which are available under its profile on EDGAR.

Mineral Resources – Sections 9, 10, and 16 – As of December 31, 2021 (100% Basis)
Measured Indicated Inferred
Tons (Mt) Grade
(% U3O8)		 Content (MLbs. U3O8) Tons (Mt) Grade
(% U3O8)		 Content
(MLbs. U3O8)		 Tons (Mt) Grade
(% U3O8)		 Content (MLbs. U3O8)
0.210 0.48 1.98 1.30 0.48 12.58 1.20 0.47 11.21

 

Mineral Resources – Section 17 – As of December 31, 2021 (100% Basis)
Measured Indicated Inferred
Tons (Mt) Grade
(% U3O8)		 Content (MLbs. U3O8) Tons (Mt) Grade
(% U3O8)		 Content
(MLbs. U3O8)		 Tons (Mt) Grade
(% U3O8)		 Content (MLbs. U3O8)
      0.34 0.45 3.06 0.32 0.42 2.64
Notes On Mineral Resources:
  1. The mineral resources were estimated as defined in 17 CFR § 229.1300 of Regulation S-K 1300.
  2. Mineral Resources are estimated at a U3O8 cut-off grade of 0.19% U3O8
  3. A minimum mining thickness of six feet was used, along with $241/ton operating costs, $65/lb U3O8 price, and 95% recovery.
  4. Bulk density is 0.067 ton/ft3 (15.0 ft3/ton or 2.14 t/m3).
  5. Mineral Resources are not Mineral Reserves and do not have demonstrated economic viability.
  6. Mineral Resources are 100% attributable to EFR and are in situ.
  7. Numbers may not add due to rounding.

 (1) Technical Report on the Roca Honda Project, McKinley County, State of New Mexico, U.S.A., with an effective date of February 22, 2022, prepared for Energy Fuels Inc. and authored by SLR International Corporation.

The Roca Honda Royalty is equal to 4% of the gross value from the sale of U3O8 produced from Section 17 of the Roca Honda Project, less certain specified deductions, including sales brokerage, transportation costs, state severance taxes imposed on the value of product sold, weighting, sampling and assaying charges at the converter and penalties, surcharges or deductions levied by the converter. "Section 17" refers to section 17 of Township 13N/Range 8W, comprising 640 acres of the 4440 acres (14%) of the Roca Honda Project.

The Roca Honda Royalty does not apply to the entire project area for the Roca Honda Project. The royalty currently applies to approximately 640 acres, or approximately 14% of the current project area.

The Roca Honda Technical Report includes updated NI 43-101 and Regulation S-K 1300 compliant resources that now include Section 17, totaling 17.6 Mlbs of U3O8 (1.85 million tonnes ("Mt") at an average grade of 0.48% U3O8) in the Measured and Indicated categories, as well as an additional 13.8 Mlbs (1.51 Mt at an average grade of 0.46% U3O8) in the Inferred category as at December 31, 2021.

The Roca Honda Technical Report included an initial assessment with economics, which included Section 17 and other areas of the project not covered by the Roca Honda Royalty. A proposed production schedule has the mineralization from Section 17 mined in the first three years of the mine life, with a total of 4.23 Mlbs of U3O8 produced in Section 17 from a total of 587.68 thousand tons of ore. This represents approximately 14.6% of the total pounds mined from the project over the LOM.

Overall, the technical report states total mill feed processed of 4.02 million short tons, recovering 27.5 Mlbs of U3O8 over the 11 years of mine life with average annual U3O8 sales of 2.5 Mlbs/year for the entirety of the project, which covers an area greater than the Roca Honda Royalty. The study utilizes a static uranium price of US$65.00/lb. U3O8. The preproduction period is stated at 54 months, with LOM capital costs totaling US$482.3 million and LOM operating costs of US$945.9 million. On an after-tax basis, the report states the undiscounted cash flow for the base case totals US$253.7 million over the LOM. The after-tax Net Present Value at a 5% discount rate is estimated at $55.9 million and the Internal Rate of Return is stated at 7.6%, with simple payback from the start of commercial production occurring in 8.1 years.

The economic analysis contained in the TRS is based, in part, on Inferred Mineral Resources, and is preliminary in nature.  Inferred Resources are considered too geologically speculative to have the economic considerations applied to them that would enable them to be categorized as Mineral Reserves.  There is no certainty that economic forecasts assumptions on which the TRS is based will be realized.

Energy Fuels states in its annual report on Form 10-K for the year ended December 31, 2022, that Energy Fuels intends to continue its permitting and related activities at the Roca Honda Project during 2023. These activities would include the integration of properties adjacent to the Roca Honda Project into the permitting efforts underway, including the submittal of a revised National Pollutant Discharge Elimination System permit application to the EPA and continuation of a supplement to the draft Environmental Impact Statement through the U.S. Forest Service, an agency of the U.S. Department of Agriculture.

Energy Fuels has disclosed that it expects a Record of Decision to be issued by the United States Forest Service in 2023. In such annual report, Energy Fuels disclosed that other major permits required for the Roca Honda Project included a Permit to Mine to be issued by the New Mexico Mining and Minerals Division, a discharge permit to be issued by the New Mexico Environment Department and a Mine Dewatering Permit to be issued by the New Mexico State Engineer's Office.

Mineralization was initially discovered in the area of the Roca Honda Project in 1970 by Kerr-McGee Oil Industries. The project claims were acquired by Strathmore Minerals Corp. in 2004.

Upon completion of a joint venture agreement with Sumitomo Corporation in 2007, Strathmore Minerals completed baseline water quality, environmental and tailings disposal studies between 2007 and 2009 and a technical report was completed on portions of the project (not including Section 17) in 2010.

In August of 2013, Energy Fuels acquired a 60% interest in the Roca Honda Project through the acquisition of Strathmore Minerals and, in May of 2016, acquired the remaining 40% interest in the Roca Honda Project from Sumitomo Corporation. Strathmore Resources acquired Section 17 in 2015 from Uranco Inc., a wholly-owned subsidiary of Westwater Resources Inc. (f/k/a Uranium Resources Inc.).

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