Encore Energy Announces Completion of Azarga Uranium Acquisition: Creation of Top Tier United States Isr Uranium Company
ENCORE ENERGY ANNOUNCES COMPLETION OF AZARGA URANIUM
ACQUISITION: CREATION OF TOP TIER UNITED STATES ISR URANIUM
COMPANY
CORPUS CHRISTI, Texas
,
Jan. 4, 2022
/CNW/ - enCore Energy Corp. ("
enCore
") (TSXV: EU) (OTCQB: ENCUF) and Azarga Uranium Corp. ("
Azarga
Uranium
") (TSX:AZZ, OTCQB:AZZUF, FRA:P8AA) are pleased to announce the closing of the previously announced plan of arrangement (the "
Arrangement
")
whereby enCore has acquired all of the outstanding shares of Azarga Uranium. The Arrangement consolidates an industry leading pipeline of exploration and
development stage in-situ recovery ("
ISR
") projects, including two production licenses and focused uranium projects in preferred, permittable
United States
jurisdictions and resources of approximately 90 million pounds of U3O8 estimated in the measured and indicated categories and 9 million pounds of U3O8
estimated in the inferred category
1
.
enCore's assets include the licensed Rosita & Kingsville production facilities in
South Texas
, the advanced-stage Dewey Burdock development project in
South
Dakota
, which has been issued its key federal permits, the PEA-stage Gas Hills Project, located in
Wyoming
, and a dominant portfolio of large high quality ISR
projects throughout
Wyoming
and
New Mexico
. The completion of the Arrangement is the second major acquisition by enCore within the past twelve months and
represents a continuation of enCore's strategy to create the leading United States ISR uranium producer.
William Sheriff
, Executive Chairman of enCore, stated: "ISR production has major operating and capital cost advantages as well as significantly less environmental
impact compared to conventional mining. This strategic acquisition adds strong mid-term ISR opportunities in
Wyoming
and
South Dakota
to enCore's pipeline of
near term production in
Texas
and longer-term opportunities in
New Mexico
. This second major acquisition for enCore within the last 12 months is in keeping with
our announced decision to implement the aggressive M&A strategy our team successfully used to quickly build Energy Metals Corp, which was sold for
$1.6 billion
during the last uranium cycle. We believe industry consolidation in conjunction with an elite operational team are the keys to success in building a leading US ISR
company."
Paul Goranson
, Chief Executive Officer of enCore, commented: "Dewey Burdock is an excellent advanced ISR uranium project along with the Gas Hills property in
Wyoming
. Our experienced operating team looks forward to building upon Azarga Uranium's success to create additional value through development progress and
production while continuing to advance our
Texas
assets to production to deliver into two sales contracts beginning in 2023."
With this transformational acquisition complete and a strong cash position, work is underway to implement enCore's operational gameplan:
South Texas
based
Rosita Plant
modernization on schedule and on budget for a Q2/22 completion;
Expansion of
Texas
resource base for Rosita production;
Rosita project wellfield drilling underway;
NI 43-101 resource estimates and reclassification of historic resources nearing completion;
Implement an expanded community outreach strategy to develop long term mutually-beneficial opportunities in
New Mexico
;
On-going non-core asset divestment;
Evaluation of and advancing future growth opportunities.
With the completion of the transaction, additional work on projects previously held by Azarga Uranium will include:
Intensify and accelerate permitting related to the advancement of the Dewey Burdock project in
South Dakota
;
Initiate permitting to advance the Gas Hills project in
Wyoming
;
Advance future development of the Aladdin and Dewey Terrace properties in
Wyoming
.
Closing of the Arrangement
Pursuant to the Arrangement, enCore acquired all of the issued and outstanding common shares of Azarga Uranium on the basis of 0.375 common shares of
enCore for each Azarga Uranium share.
Outstanding warrants and options to purchase common shares of Azarga Uranium were deemed to be exchanged for
options and warrants to purchase common shares of enCore and were adjusted in accordance with their terms based on the exchange ratio.
The common shares of Azarga Uranium are expected to be delisted from the Toronto Stock Exchange ("
TSX
") within 2 to 3 trading days following the closing of
the Arrangement in accordance with stock exchange policies. Azarga Uranium will apply to cease to be a reporting issuer under Canadian securities laws.
The U.S. Nuclear Regulatory Commission ("
NRC
") is completing a review in connection with the NRC's consent to the change of control over the Dewey Burdock
Source and By-Product Materials License. enCore has agreed to maintain the existing Azarga Uranium management and directors in place pending conclusion of
the NRC consent process, currently scheduled for
February 1, 2022
. Following the NRC's consent, enCore will appoint a director from Azarga Uranium to join the
enCore board of directors, and engage
Blake Steele
as a strategic advisor to enCore, as previously announced.
About enCore Energy Corp.
enCore Energy, the most diversified U.S. domestic uranium developer is focused on becoming a leading ISR uranium producer. The enCore team is led by
industry experts with extensive knowledge and experience in all aspects of ISR uranium operations and the nuclear fuel cycle. enCore's initial opportunities are
created from enCore's licensed and past-producing
South Texas
-located Rosita and Kingsville Dome ISR production facilities, under development, and multiple
satellite projects in
South Texas
plus the changing global uranium supply/demand outlook and opportunities for industry consolidation. The advanced staged
Dewey Burdock project in
South Dakota
and the Gas Hills project in
Wyoming
add to the large uranium resource endowments in
New Mexico
creating an
outstanding asset base for long term growth and development opportunities with approximately 90 million pounds of U3O8 estimated in the measured and
indicated categories and 9 million pounds of U3O8 estimated in the inferred category
1
.
About Azarga Uranium Corp.
Azarga Uranium, a 100% owned subsidiary of enCore Energy, is an integrated uranium exploration and development company that controls ten uranium projects
and prospects in
the United States of America
(
South Dakota
,
Wyoming
,
Utah
and
Colorado
), with a primary focus of developing ISR uranium projects. The
Dewey Burdock ISR uranium project in
South Dakota, USA
, which is Azarga Uranium's initial development priority, has been issued its NRC License and Class III
and Class V Underground Injection Control permits from the Environmental Protection Agency and Azarga Uranium is in the process of completing other major
regulatory permit approvals necessary for the construction of the Dewey Burdock project.
Dr.
Douglas H. Underhill
, CPG, the Company's Chief Geologist and a Qualified Person under NI 43-101, has approved the technical disclosure in this news
release.
1
Mineral resource estimates are based on technical reports prepared pursuant to NI 43-101 and available on SEDAR as well as company websites at www.encoreuranium.com and www.azargauranium.com.
Cautionary Statements
Certain information contained herein constitutes forward-looking information or statements under applicable securities legislation and rules. All statements, other
than statements of historical fact, are forward-looking statements. Forward-looking statements are frequently identified by such words as may, will, plan, expect,
anticipate, estimate, intend, indicate, scheduled, target, goal, potential, subject, efforts, option and similar words, or the negative connotations thereof, referring to
future events and results. Forward looking statements in this press release include, but are not limited to, statements related to the implementation of enCore's
operational gameplan, additional work on projects previously held by Azarga Uranium, the delisting of the common shares of Azarga Uranium, Azarga Uranium
ceasing to be a reporting issuer, changes to the board and management of enCore and Azarga Uranium and the anticipated benefits of the Arrangement.
Forward-looking statements are based on the opinions and estimates of management as of the date such statements are made and are subject to known and
unknown risks, uncertainties and other factors that may cause the actual results, level of activity, performance or achievements of enCore and/or Azarga Uranium
to be materially different from those expressed or implied by such forward-looking statements, including, but not limited to: the costs associated with enCore's
objectives; risks and uncertainties related to the COVID-19 pandemic and measures taken to attempt to reduce the spread of COVID-19; and the risks and
uncertainties identified in each of enCore and Azarga Uranium's most recent Management's Discussion and Analysis, filed on SEDAR at
www.sedar.com
.
Although management of enCore and Azarga Uranium have attempted to identify important factors that could cause actual results to differ materially from those
contained in forward-looking statements, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no
assurance that such statements will prove to be accurate. Readers should not place undue reliance on forward-looking statements. Neither enCore nor Azarga
Uranium will update any forward-looking statements except as required by applicable securities laws. enCore and Azarga Uranium caution readers not to place
undue reliance on these forward-looking statements and it does not undertake any obligation to revise and disseminate forward-looking statements to reflect
events or circumstances after the date hereof, or to reflect the occurrence of or non-occurrence of any events.
This press release is not and is not to be construed in any way as, an offer to buy or sell securities in
the United States
. The distribution of the enCore common
shares in connection with the transactions described herein will not be registered under the U.S. Securities Act and the enCore common shares may not be
offered or sold in
the United States
absent registration or an applicable exemption from the registration requirements of the U.S. Securities Act and applicable
state securities laws. This press release shall not constitute an offer to sell or the solicitation of an offer to buy the enCore common shares, nor shall there be any
offer or sale of the enCore common shares in any jurisdiction in which such offer, solicitation or sale would be unlawful. Neither the TSX, the TSX Venture
Exchange nor its Regulation Services Provider (as that term is defined in the policies of the TSX and TSX Venture Exchange) accepts responsibility for the
adequacy or accuracy of this release.
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For further information:
Contact Information: enCore Energy Corp., William M. Sheriff, Executive Chairman, 972-333-2214, [email protected],
www.encoreuranium.com
CO: enCore Energy Corp.
CNW 07:00e 04-JAN-22