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PLANT AND EQUIPMENT AND MINERAL PROPERTIES | 6 Months Ended
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Jun. 30, 2024
Property, Plant and Equipment [Abstract] |
Plant and Equipment and Mineral Properties | PROPERTY, PLANT AND EQUIPMENT AND MINERAL PROPERTIES Property, Plant and Equipment The following is a summary of property, plant and equipment, net:
| Estimated |  |  |  |
| Useful Lives |  | June 30, 2024 |  | December 31, 2023
Land | N/A |  | $ | 642 |  |  | $ | 642 |
Plant facilities | 12 - 15 years |  | 30,195 |  |  | 29,750 |
Mining equipment | 5 - 10 years |  | 18,437 |  |  | 13,019 |
Light trucks and utility vehicles | 5 years |  | 3,880 |  |  | 3,256 |
Office furniture and equipment | 4 - 7 years |  | 1,888 |  |  | 1,754 |
Construction-in-progress(1) | N/A |  | 23,236 |  |  | 13,627 |
Total property, plant and equipment |  |  | $ | 78,278 |  |  | $ | 62,048 |
Less: accumulated depreciation |  |  | (37,922) |  |  | (35,925) |
Property, plant and equipment, net |  |  | $ | 40,356 |  |  | $ | 26,123 |
(1) Costs incurred for commissioning activities for the Company’s Phase 1 REE separation circuit at the Mill are capitalized. The Company will offset these costs upon sale of separated neodymium-praseodymium (“NdPr”) that is produced during commissioning of the Phase 1 REE separation circuit. The Company recognized depreciation expense of $0.62 million and $0.66 million for the three months ended June 30, 2024 and 2023, respectively, and $1.29 million and $1.32 million for the six months ended June 30, 2024, and 2023, respectively. Depreciation expense is included in Exploration, development and processing as well as Standby in the Condensed Consolidated Statements of Operations and Comprehensive Income (Loss). For the three months ended June 30, 2024 and 2023, the Company capitalized $0.41 million and $0.08 million respectively, of depreciation expense to inventory related to the Mill on the Condensed Consolidated Balance Sheets. For the six months ended June 30, 2024 and 2023, the Company capitalized $0.48 million and $0.16 million, respectively, of depreciation expense to inventory related to the Mill on the Condensed Consolidated Balance Sheets. For the three months ended June 30, 2023, the Company capitalized $0.07 million of depreciation expense to mineral properties on the Condensed Consolidated Balance Sheet. No depreciation expense was capitalized to mineral properties for the three months ended June 30, 2024. For the six months ended June 30, 2024 and 2023, the Company capitalized $0.23 million and $0.07 million, respectively, of depreciation expense to mineral properties on the Condensed Consolidated Balance Sheet. Mineral Properties The following is a summary of mineral properties:
| June 30, 2024 |  | December 31, 2023
Sheep Mountain | $ | 34,183 |  |  | $ | 34,183 |
Bahia Project | 31,130 |  |  | 29,130 |
Nichols Ranch ISR Project | 25,974 |  |  | 25,974 |
Roca Honda | 22,095 |  |  | 22,095 |
Pinyon Plain | 9,338 |  |  | 6,512 |
Other | 1,687 |  |  | 1,687 |
Total mineral properties | $ | 124,407 |  |  | $ | 119,581 |
Less: accumulated depletion | $ | (567) |  |  | $ | — |
Mineral properties, net | $ | 123,840 |  |  | $ | 119,581 |
Capitalized costs to mineral properties are depleted using the units-of-production method (“UOP”) over the estimated life of the ore body based on estimated recoverable material to be produced from proven and probable reserves. The calculation of the UOP rate of depletion could be materially impacted to the extent that actual production in the future is different from current forecasts of production based on proven and probable reserves. This would generally occur to the extent that there were significant changes in any of the factors or assumptions used in determining reserves. These changes could include: (i) an expansion of proven and probable reserves through exploration activity; (ii) differences between estimated and actual costs of production, due to differences in grade, recovery rates and foreign currency exchange rates; and (iii) differences between actual commodity prices and commodity price assumptions used in the estimation of reserves. If reserves decreased significantly, UOP depletion charged to operations would increase; conversely, if reserves increased significantly, UOP depletion charged to operations would decrease. Such changes in reserves could similarly impact the useful lives of assets depreciated on a straight-line basis, where those lives are limited to the life of the mine, which in turn is limited to the life of proven and probable reserves. The expected useful lives used in depletion, depreciation and amortization calculations are determined based on the applicable facts and circumstances, as described above. As judgement is involved in the determination of useful lives, no assurance can be given that actual useful lives will not differ significantly from the useful lives assumed for the purpose of depletion, depreciation and amortization calculations. Bahia Project On February 10, 2023, the Company closed on two purchase agreements to acquire a total of 17 mineral concessions in the State of Bahia, Brazil totaling approximately 37,300 acres or 58.3 square miles (the “Bahia Project”). Under the terms of the purchase agreements, the Company entered into mineral rights transfer agreements with the sellers to acquire the 17 heavy mineral sands concessions. The total purchase price under the purchase agreements was $27.50 million, which consisted of deposit payments of $5.90 million due upon reaching certain stipulated milestones and the remaining $21.60 million due at closing. Upon final payment on February 10, 2023, the transfer and assignment of the mineral rights was completed (the “Bahia Closing”). Additionally, the Company incurred direct deal costs related to such asset acquisitions of $1.63 million. The Bahia Closing followed the Brazilian Government’s approval of the transfers to Energy Fuels’ wholly owned Brazilian subsidiary Energy Fuels Brazil Ltda. Alta Mesa Transaction On February 14, 2023, the Company closed on its sale to enCore Energy Corp. (“enCore”) of three wholly-owned subsidiaries that together held Alta Mesa for total consideration of $120 million (the “Alta Mesa Transaction”), paid as follows: a.$60 million in cash, which included $6 million prior to closing and $54 million at closing; and b.$60 million secured convertible note (“Convertible Note”), payable in two years from the closing, bearing annual interest of eight percent (8%). The Convertible Note is convertible at Energy Fuels’ election into fully paid and non-assessable enCore common shares at a conversion price of $2.9103 per share, being a 20% premium to the 10-day volume-weighted average price of enCore shares ending the day before the Closing (the “Conversion Option”). enCore is currently traded on the TSX-V and NYSE American. The Convertible Note is guaranteed by enCore and fully secured by Alta Mesa. Unless a block trade or similar distribution is executed by Energy Fuels to sell the enCore common shares received on conversion of the Convertible Note, Energy Fuels will be limited to selling a maximum of $10 million of enCore common shares per thirty (30)-day period. The Company recognized a gain on sale of assets from the Alta Mesa Transaction of $116.50 million, which was calculated as the total fair value of the consideration received of $119.46 million consisting of $60 million in cash and the Convertible Note with a fair value of $59.46 million, less the net book value attributable to the Alta Mesa assets and liabilities after working capital adjustments of $3.40 million, net of transaction costs. Receipt of the Convertible Note represents a non-cash investing activity at its initial fair value. See Note 14 – Fair Value Accounting for more information on the fair value and current status of the Convertible Note. As a post-closing condition of the Alta Mesa Transaction, enCore was required to replace the $3.59 million of reclamation bonds then in place for Alta Mesa. Upon replacement, the original bonds were released and the Company received back the underlying collateral. The Company reclassified $3.59 million cash as a release of collateral from those bonds from Property, plant and equipment and other assets held for sale, net to cash and cash equivalents on its Condensed Consolidated Balance Sheets. In connection with the Alta Mesa Transaction, on May 3, 2023, the Company completed the sale of its Prompt Fission Neutron assets, including the underlying contracts, technology, licenses and intellectual property (collectively, the “PFN Assets”), to enCore in exchange for cash consideration received at closing of $3.10 million, which resulted in a gain of $2.75 million. At closing, the PFN Assets, which the Company had purchased in 2020 for cash consideration of $0.50 million, had a net book value of $0.35 million. The PFN Assets were used exclusively at the Alta Mesa ISR Project. Should the Company have the need for the use of a PFN tool in the future, the Company retained a 20-year usage right as a condition of this sale during which, subject to the availability of the PFN Assets, the Company has the right to purchase, lease and/or license at least one fully functional PFN tool and all related and/or required equipment, technology and licenses, as reasonably requested, on commercially reasonable terms and conditions no less favorable than those offered by enCore to third parties. As of June 30, 2024, the Company has not purchased, leased and/or licensed a PFN tool.

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- Definition The entire disclosure for long-lived, physical asset used in normal conduct of business and not intended for resale. Includes, but is not limited to, work of art, historical treasure, and similar asset classified as collections. + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Topic 360 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org//360/tableOfContent Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Name Accounting Standards Codification -Section 50 -Paragraph 6 -SubTopic 360 -Topic 958 -Publisher FASB -URI https://asc.fasb.org//1943274/2147480321/958-360-50-6 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Name Accounting Standards Codification -Section 50 -Paragraph 1 -Subparagraph (d) -SubTopic 360 -Topic 958 -Publisher FASB -URI https://asc.fasb.org//1943274/2147480321/958-360-50-1 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Name Accounting Standards Codification -Section 50 -Paragraph 7 -SubTopic 360 -Topic 958 -Publisher FASB -URI https://asc.fasb.org//1943274/2147480321/958-360-50-7 + Details
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