enCore Energy Provides Update on South Texas Uranium Operations
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Insights
The operational progress and drilling results from enCore Energy Corp.'s South Texas operations, specifically the Alta Mesa In-Situ Recovery (ISR) Uranium Central Processing Plant (CPP), are indicative of a company moving forward with its strategic plan. The on-schedule advancements and high-grade drilling outcomes suggest that enCore is poised to meet its early 2024 production goals, which is likely to be viewed favorably by the market. The ISR method, a less invasive form of uranium extraction, could position the company as an environmentally conscious producer in a market that is increasingly sensitive to such considerations.
Moreover, the joint venture with Boss Energy enhances the financial robustness of the project, infusing capital and potentially diversifying risk. Investors may interpret these developments as a sign of confidence from external parties in enCore's operational capabilities and resource potential. However, the decision to proceed without a new feasibility study introduces a higher degree of risk, which could be a point of concern for risk-averse stakeholders. The market's reception to these updates will likely hinge on the balance between the positive drilling results and the inherent risks of advancing without updated feasibility studies.
enCore Energy Corp.'s financial position may be significantly impacted by the operational updates and drilling results. The substantial capital investment in the Alta Mesa CPP through upgrades and refurbishments and the positive drilling results, suggest potential for increased future revenue streams. High-grade uranium findings are particularly noteworthy, as they directly correlate with the efficiency and profitability of production.
The financial implications of the joint venture with Boss Energy should not be underestimated. The $60 million USD and the $10 million USD placement into enCore shares represent a considerable injection of funds. This capital could be leveraged to accelerate production and expand drilling programs, potentially leading to an increase in the company's market valuation. However, it is essential to monitor uranium market prices, as they will ultimately dictate the return on investment for these operations. The historical context of production curtailment due to low uranium prices serves as a reminder of the volatility and price sensitivity inherent in the industry.
From an industry perspective, enCore Energy Corp.'s use of In-Situ Recovery (ISR) technology for uranium extraction is a significant factor. ISR is a cost-effective and environmentally friendly method compared to traditional open-pit or underground mining, which may give enCore a competitive edge. The company's ability to produce uranium at competitive costs could become a critical factor in its ability to secure long-term contracts and partnerships.
The detailed drilling results, showcasing high-grade thicknesses, suggest that enCore's Alta Mesa Project could be one of the more promising uranium projects in the United States. The strategic importance of domestic uranium production cannot be overstated, given the current geopolitical climate and the push for energy independence. The company's positioning in a 'business-friendly' state like Texas, coupled with the significant mineral resources indicated in the report, reinforces its potential to become a key player in the U.S. uranium sector.
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Highlights include:
- The Alta Mesa In-Situ Recovery (ISR) Uranium Central Processing Plant (CPP) upgrades and refurbishments are advancing on schedule for the planned early 2024 resumption of uranium production;
- The Alta Mesa Project wellfield drilling is providing increasingly positive high-grade results from the wellfield delineation drill program;
- Uranium production from the Rosita CPP which commenced November 21, 2023, continues to meet projected start up production levels. Additionally, the Grand Opening at the Rosita CPP is scheduled on-site for February 6, 2024.
Paul Goranson, enCore Energy's Chief Executive Officer, stated: "Our South Texas operations continue to advance on schedule due to our successful planning to ensure all necessary supplies and equipment were secured well in advance of installation. With a full complement of people, materials, and equipment in the field, we are well positioned to make our timelines at our second production facility, Alta Mesa. Additionally, the wellfield drill results are some of the best grades we have encountered to date. These results support our plan to accelerate and expand the drill program at the Alta Mesa Uranium Project."
To view the Alta Mesa CPP and Wellfield and Rosita CPP maps please visit: bit.ly/3fV9fTg.
At the Alta Mesa CPP, enCore has met most of the key objectives for the refurbishment of the processing circuits necessary for the planned early 2024 restart. Work remaining includes final inspection of the ion exchange columns, testing the precipitation tanks, completing tie-in of the scrubber system, and installation and testing of the process circuit instrumentation. The yellowcake drying circuit upgrades are advancing with the filter press support infrastructure on site. Refurbishment and testing of the yellowcake drying system is progressing with that work scheduled to be completed just prior to the anticipated production restart timelines.
Within Production Authorization Area 7 (PAA-7), enCore is installing injection and production wells in the wellfield, has completed installation of the electrical transmission lines necessary for initial start-up and is continuing to install the pipelines to connect the wellfield to the Alta Mesa CPP. All necessary equipment for the start-up of production in the PAA-7 wellfield has been received or has been ordered with a confirmed delivery schedule.
The wellfield drilling operations, delineating the roll front mineralization within PAA-7, which commenced in March 2023, are advancing rapidly with 78 holes drilled since the previous update (November 20, 2023). In total, 445 drill holes have been completed through January 4th, 2024. There are currently six (6) drill rigs in full operation at the Alta Mesa CPP and Wellfield, with contracts pending for three (3) additional rigs.
Further refined delineation drilling within the PAA-7 continues to establish the exact pattern of injection and recovery wells from which to maximize production efficiency. To date, ninety-nine (99) holes have been cased with thirty-six (36) injection and production wells completed. Two (2) drill rigs are currently casing wells and one (1) drill rig focused on well completion activities. An additional drill rig will be moving to well completion activities in the coming weeks.
In addition to increasing numbers of drill holes and wells with Grade Thicknesses ("GT") over 1.0 in PAA-7, the Middle C unit, which was found to overlie PAA-7 in 2023 (NR May 18, 2023) continues to exhibit unexpected significant grade, and further drilling along the Middle C trend is increasing the overall mineralization within PAA-7. Grade Thickness is Grade % U3O8 multiplied by the thickness of the mineralization. ISR recoverable uranium with a Grade Thickness of >0.3 is considered suitable for inclusion in a wellfield.
Significant Alta Mesa Wellfield Drilling Results
Drill Hole | Goliad Sandstone Horizon | Depth | Grade % | Thickness | Grade | Total |
166-109 | MCU-2 | 418.0 | 0.165 | 2.5 | 0.412 | |
162-116 | MCU-1 | 411.5 | 0.167 | 2.0 | 0.335 | |
169-106 | LCU-2 | 497.0 | 0.174 | 8.5 | 1.476 | |
164-117 | LCU-2 | 491.0 | 0.193 | 5.5 | 1.062 | |
176-92 | LCL-1 | 517.0 | 0.167 | 3.0 | 0.502 | |
175-911 | LCL-1 | 517.0 | 0.149 | 4.0 | 0.598 | |
175-912 | LCU-1 | 499.0 | 0.116 | 4.0 | 0.463 | |
166-109 | MCU-1 | 413.5 | 0.160 | 5.0 | 0.798 | |
181-951 | LCU-1 | 511.0 | 0.173 | 6.0 | 1.039 | |
169-103 | LCL-1 | 514.0 | 0.444 | 3.5 | 1.554 | |
181-952 | LCU-2 | 514.5 | 0.310 | 2.5 | 0.775 | |
166-112 | LCL-1 | 511.5 | 0.181 | 2.5 | 0.452 | |
183-98 | LCU-2 | 509.5 | 0.141 | 5.0 | 0.706 | |
LCL-1 | 520.5 | 0.072 | 6.0 | 0.429 | 1.135 | |
167-113 | LCU-2 | 492.5 | 0.123 | 3.0 | 0.368 | |
172-961 | MCU-1 | 418.0 | 0.098 | 3.0 | 0.294 | |
LCU-1 | 484.0 | 0.125 | 2.0 | 0.250 | ||
LCU-2 | 504.5 | 0.267 | 4.0 | 1.067 | 1.611 | |
172-962 | LCU-2 | 503.0 | 0.143 | 5.0 | 0.714 | |
LCL-1 | 516.0 | 0.201 | 2.5 | 0.503 | 1.217 | |
172-95 | LCU-2 | 503.5 | 0.334 | 5.0 | 1.672 | |
LCL-1 | 517.5 | 0.228 | 2.0 | 0.455 | 2.127 | |
172-97 | LCU-2 | 501.0 | 0.386 | 5.5 | 2.121 | |
181-94 | LCU-2 | 512.0 | 0.256 | 10.0 | 2.563 | |
167-108 | MCU-1 | 410.5 | 0.233 | 4.0 | 0.931 | |
171-99 | LCL-1 | 509.0 | 0.188 | 2.5 | 0.471 |
-All intercepts are located in the PAA-7 which hosts mineralization within the Goliad Formation. The Company has identified five saturated (required for ISR), mineralized sandstone horizons within the Goliad Formation lying approximately 400 to 520 feet below the surface. The water level is located approximately 120 feet below the surface. Grade Thickness is Grade % U3O8 multiplied by the thickness of the mineralization. ISR recoverable uranium with a Grade Thickness of >0.3 is considered suitable for inclusion in a wellfield. |
The Alta Mesa CPP and Wellfield hosts a fully licensed and constructed ISR uranium plant, located on 200,000+ acres of private land in the state of
Total operating capacity at the Alta Mesa CPP is 1.5 million lbs. U3O8 (uranium) per year. The Alta Mesa CPP historically produced nearly 5 million lbs. U3O8 between 2005 and 2013, when full production was curtailed as a result of low uranium prices.
Alta Mesa CPP and Wellfield highlights:
- The Alta Mesa CPP is enCore's third fully licensed production facility, along with the Rosita CPP and Kingsville Dome CPP, all located in the business-friendly state of
Texas . There are only eleven (11) licensed and constructed uranium production facilities in all ofthe United States (US); - Alta Mesa CPP's operations are located on private land, with
100% of minerals privately owned, and in a supportive jurisdiction with primary regulatory authority residing with theState of Texas ; - The Alta Mesa CPP utilizes well-known ISR technology to extract uranium in a non-invasive process using natural groundwater and oxygen, coupled with a proven ion exchange process, to recover the uranium.
Alta Mesa & Mesteña Grande Mineral | Tons | Avg. Grade (% U3O8) | Pounds |
Total Measured Mineral Resource1 | 54,000 | 0.152 | 164,000 |
Alta Mesa Indicated Mineral Resource | 1,397,000 | 0.106 | 2,959,000 |
Mesteña Grande Indicated Mineral Resource | 119,000 | 0.120 | 287,000 |
Total Measured & Indicated Resources | 1,570,000 | 0.109 | 3,410,000 |
Alta Mesa Inferred Mineral Resource | 1,263,000 | 0.126 | 3,192,000 |
Mesteña Grande Inferred Mineral Resource | 5,733,000 | 0.119 | 13,601,000 |
Total Inferred Resources | 6,996,000 | 0.120 | 16,793,000 |
1,2 Represents that portion of the in-place mineral resource that are estimated to be recoverable within existing wellfields. Wellfield recovery factors have not been applied to indicated and inferred mineral resources. As reported in the NI-43-101 Technical Report Summary for the Alta Mesa Uranium Project, |
The Company advises that it is not basing its production decisions at Alta Mesa CPP or Rosita CPP on a feasibility study of mineral reserves demonstrating economic and technical viability. The production decision is based on known past In-Situ Recovery (ISR) and processing operations at these two production facilities and surrounding lands. However, the Company understands that there is increased uncertainty, and consequently a higher risk of failure, when production is undertaken in advance of a feasibility study. The Company has determined to proceed with a production decision based on past operations at the Alta Mesa CPP and Rosita CPP, including past ISR operations in the known mineral resource areas.
John M. Seeley, Ph.D., P.G., C.P.G., enCore's Manager of Geology and Exploration, and a Qualified Person under NI 43-101, has reviewed and approved the technical disclosure in this news release on behalf of the Company.
enCore Energy Corp., America's Clean Energy Company™, is committed to providing clean, reliable, and affordable domestic nuclear energy as the newest uranium producer in
Future projects in enCore's production pipeline include the Dewey-Burdock project in
Neither TSX Venture Exchange nor its Regulation Services Provider (as that term is defined in policies of the TSX Venture Exchange) accepts responsibility for the adequacy or accuracy of this release.
The Company advises that it is not basing its production decisions at Alta Mesa CPP or Rosita CPP on a feasibility study of mineral reserves demonstrating economic and technical viability. The production decision is based on known past ISR and processing operations at these two production facilities and surrounding lands. However, the Company understands that there is increased uncertainty, and consequently a higher risk of failure, when production is undertaken in advance of a feasibility study. The Company has determined to proceed with a production decision based on past operations at the Alta Mesa CPP and Rosita CPP, including past ISR operations in the known mineral resource areas.
Note on forward looking information: Certain information contained in this news release, including: any information relating to the Company being a leading uranium company, statements regarding future or potential production, and any other statements regarding future expectations, beliefs, goals or prospects; may constitute "forward-looking information" and "forward-looking statements" within the meaning of applicable Canadian and
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SOURCE enCore Energy Corp.
FAQ
What is the update provided by enCore Energy Corp. regarding its South Texas operations?
When is the Grand Opening at the Rosita CPP scheduled?
What is the historical production capacity of the Alta Mesa CPP?
What is the total number of drill holes completed through January 4th, 2024?
What is the status of the pending joint venture transaction with Boss Energy?
