Benzinga | Sep 14, 2020 02:49PM EDT

Energy Fuels Highlights US Dept. Of Commerce Obtained Russian Deal To Extend Limits On Uranium Imports Into US From Russia Through 2040

Energy Fuels Inc. (NYSE:UUUU) (TSX:EFR) ("Energy Fuels"), the leading producer of uranium in the United States, is pleased to announce that the U.S. Department of Commerce ("Commerce") has obtained Russia's agreement to extend limits on uranium imports into the U.S. from Russia through 2040 under an extended Russian Suspension Agreement ("RSA"). This is an important step toward maintaining the long-term health of the U.S. uranium mining industry, especially since the expiration of the RSA at the end of 2020 could have resulted in unlimited Russian uranium imports into the U.S.

Commerce won important concessions from Russia, including lower quotas starting in the mid-2020's, allowing only a portion of the quotas to be used for the sale of U3O8 and conversion into the U.S., and strict controls on Russian enrichment service contracts.

Mark S. Chalmers, President and CEO of Energy Fuels stated: "Energy Fuels thanks the Department of Commerce for their efforts in reducing U.S. dependence on Russian uranium in the long tem. This is a critical step in restoring U.S. leadership in the global nuclear fuel sector and helping to revive the U.S. uranium mining industry.

"While we are pleased with the long-term prospects available to established U.S. uranium producers like Energy Fuels, the shorter-term picture for the U.S. uranium industry still remains uncertain. Even though Commerce has negotiated lower quotas starting in the mid-2020's, the agreement allows for the 'grandfathering' of existing contracts between U.S. nuclear utilities and Russian state-owned enterprises, which will actually result in Russian uranium imports into the U.S. increasing during the next three years, before decreasing in the mid 2020's. While the agreement does a good job at blocking Russia's stated intention to expand its share of the U.S. uranium market over the long-term, it only provides U.S. uranium miners with limited immediate relief. Today's announcement therefore highlights the importance and urgency of Congress appropriating the funds requested by the U.S. Department of Energy to support the strategic Uranium Reserve recommended by the U.S. Nuclear Fuel Working Group. Establishing the Uranium Reserve now will help ensure that U.S. uranium production capabilities can benefit from the long-term restrictions imposed under the extended RSA. We also support the efforts of Senator John Barrasso of Wyoming to put this agreement into law 'so Russia cannot walk away from the deal' in the future.

"The U.S. cannot consider itself to be energy independent when we are nearly 100% dependent on imports to fuel the nuclear power plants that provide nearly 20% of U.S. electricity. It is vital that Congress appropriate the funds to create the strategic Uranium Reserve to support U.S. national security and reduce Russia's influence on the U.S. energy grid. Energy Fuels will continue to lead industry initiatives to reduce U.S. dependence on uranium imports from geopolitical challengers, including Russia."

Commerce is releasing a draft amendment of the RSA for public comment. Comments will be due by 5:00 pm EDT on September 28, 2020. The draft amendment is available to registered users at https://access.trade.gov (reference case number A-821-802), and it will also be published in the Federal Register. Commerce is seeking to finalize an amendment to the RSA no later than October 5, 2020, at which time it will go into effect and become binding on the U.S. and Russia.