Good morning. My name is Sylvie, and I will be your conference operator today. At this time, I would like to welcome everyone to the Energy Fuels conference call. Note that all lines have been placed on mute to prevent any background noise. After the speaker's remarks, there will be a Q&A session. If you would like to ask a question during this time, simply press star then the number one on your telephone keypad. And if you would like to withdraw your question, please press star then the number two. Thank you. Mr. Chalmers, you may go ahead and begin the call.
Thank you. Good morning and welcome to Energy Fuels webcast. My name is Mark Chalmers, and I'm the President and CEO of Energy Fuels. Joining me today will be Paul Goranson, our COO, and Curtis Moore, VP of Marketing and Corporate Development. Yesterday, the U.S. government announced the strongest statement of support for the U.S. nuclear fuel and uranium industry in decades. We are very proud to say that that is the culmination of 2.5+ years of effort, primarily by Energy Fuels, to get the government and Americans to understand the importance of having a viable domestic uranium and nuclear fuel cycle chains in the country. Certainly, supply chains are making headlines today, and to begin a full understanding of how dependent the U.S. has become on our geopolitical foes for certain critical materials.
Unfortunately, the past couple of decades, America has sold our national interests to the lowest bidder. Usually, the lowest bidder is a state-owned enterprise owned by China, or in the cases of uranium and nuclear fuel, Russia. Yesterday, the U.S. government issued a report intended to guide policy over the next 10 years to rebuild America's nuclear fuel and uranium mining capabilities. Today, we're going to talk about the report and what it means to Energy Fuels. Now, just a reminder that the slides on the webcast are controlled by you individually, so you'll need to advance them with the little toggle on your computer screen. Next slide. I may be making some forward-looking statements today, so those are included at the end of this presentation in our recently filed 10-K. Next slide. Well, really, what is America's uranium problem? Today, America is truly addicted to foreign uranium.
We get 20% of our electricity and 55% of our carbon-free electricity from nuclear energy. Many of you have heard me say this before: we're the largest consumer of uranium by a country mile. Approximately one-third of the world's uranium is consumed by the United States. We were also the largest producer of uranium up until the early 1980s. In 2019, we didn't produce even enough uranium to fuel one single commercial reactor. To make matters worse, we have no uranium conversion since 2017. We dismantled our last U.S.-owned uranium enrichment facility in 2013. We often talk about being energy independent. However, in 2020, we are now almost 100% dependent on our uranium and nuclear fuel from imports. Historically, we've been able to fall back on our allied nations like Canada, Australia, Namibia, and the like, but today, uranium production in Canada is zero.
It's declined substantially in Australia, and China is buying up Namibia quicker than anyone would have anticipated. This situation represents a major national security issue for the United States. The U.S. nuclear fuel report released yesterday seeks to fix this problem. Next slide. I'd like to give you a little history on how the Nuclear Fuel Working Group came about. Energy Fuels has led the charge and spent the most time and the most money on this initiative than anyone in the U.S. industry. The whole process began in January 2018 when we jointly filed a petition for relief under Section 232 with our fellow U.S. uranium miner, Ur- Energy. In July 2018, the U.S. Department of Commerce initiated an investigation into uranium imports.
In April of 2019, Secretary Wilbur Ross submitted a report to the President, and we believe this report found, and now we haven't seen the report, but we hope to see it someday, that there are extreme levels of uranium and nuclear fuel imports that pose, being imported in the United States, that pose a threat to U.S. national security. We believe that Commerce recommended some sort of trade action. In July of 2019, President Trump recognized the national security concerns here surrounding uranium imports, but he declined to act on the Commerce recommendation with regard to trade restrictions. Instead, he created the U.S. Nuclear Fuel Working Group to provide him with, in a more holistic way, recommendations on reviving and expanding the production of nuclear fuel in the United States. Yesterday's report is a result of this group.
As the largest uranium producer in the United States, with more production capability, facilities, and resources, and employees than any other U.S. producer, we are extremely proud of the role we have taken on this initiative. Next slide. As I mentioned at the beginning of this presentation, we believe this is the strongest statement the U.S. government has made to support U.S. uranium mining in decades. I think it's also important to understand this is a policy document, and it supports recommendations and a variety of flexible solutions.
It is not intended to describe in detail, step by step, the process. But most importantly, it lays out very clearly justifications for congressional appropriations and executive actions over the next 10 years, including supporting U.S. national security, clean energy independence, countering Russian influence, and we've never seen it greater than ever, probably, particularly with the oil and gas issues, fostering exports of U.S.
nuclear technology and products, and promoting global nuclear safety and non-proliferation, as well as creating jobs. It describes some general recommendations on how to begin the process. But restoring the U.S. industry is not limited to these recommendations. The ultimate goal is to restore American leadership in nuclear energy and nuclear fuel. So the report maintains the flexibility to implement other programs and policies to achieve this goal. Next slide. Now, I'd like to talk about some of the direct quotes from the Nuclear Fuel Working Group Report because I think they're very powerful. And I'm actually going to read them out. And they quote, "Immediate and bold action to strengthen the uranium mining and conversion industries and restore the viability of the entire front end of the nuclear fuel cycle." Direct quote from the report.
The report also recognizes and I quote "importance of taking focused, deliberate actions to prevent the near-term collapse of the domestic uranium mining, milling, and conversion industries." Another one, "U.S. national security is truly integrated with the health of the front end of the nuclear fuel cycle. The United States needs a strong civil nuclear industry to enable national defense." And this is another one that I really like. "American companies do not face competition from other international companies. They face competition from state actors." And the report also recommends - and I quote - "leveling the playing field against state-owned enterprises." So I think those are some pretty powerful quotes in this report, and we're very proud that they are as bold as they are. So now I'd like to turn it over to Paul Goranson to talk in more detail about the report.
Thank you, Mark. I want to talk about the policy document as Mark described it. The working group report describes a set of general policy recommendations to support domestic uranium miners. We believe it is intended to garner bipartisan support across multiple administrations and congresses during the 2020s. It is a pro-national security, pro-energy independence, pro-supply chain security, and pro-American as it seeks to challenge Russia's and China's dominance in the global nuclear markets. We believe this document will be used to justify congressional appropriations, including U.S. uranium reserves recently included in the President's fiscal year 2021 budget, in addition to other funding packages, perhaps even including an upcoming aid or infrastructure bill. The document can be used to justify any actions the administration may take in support of U.S. uranium miners. Finally, the U.S.
Department of Commerce is currently in negotiations with the government of Russia to determine whether to limit Russian imports into the U.S. in 2020 and beyond, 2021, pardon me, and beyond. I think this document will help the U.S. in its negotiations and justify any requirements placed on Russia to access U.S. nuclear markets. Next slide, please. This slide summarizes the policy recommendations in the report directly related to uranium mining. The administration has already requested $150 million per year, beginning in fiscal year 2021, to begin building a strategic U.S. uranium reserve and support existing domestic uranium miners such as Energy Fuels. The President's budget and the working group report states that this money is intended to support the operation of at least two uranium mines.
To ensure taxpayer funds are spent wisely, we believe this money should be allocated to existing proven uranium facilities, like the ones Energy Fuels owns and operates, and not towards new facilities. The truth is that mining uranium is difficult, and a lot of mines fail to meet expectations or fail altogether. While we are still seeking clarity on this point, it appears to be a discussion of potentially making additional purchases of uranium for the American Assured Fuel Supply, which is a backup supply for nuclear fuel reloads. In our view, this point is intended to emphasize the flexibility of this program to do what it takes to restore U.S. uranium mining. The deal will end all barter programs, which have directly competed with U.S. uranium miners in the past. Importantly, the report supports restricting uranium imports into the U.S. from Russia.
Theoretically, Russian imports have been limited for the past 30 years in an effort to support U.S. uranium miners. However, the program has been a failure. The U.S. Department of Commerce is working to make sure that the Russian Suspension Agreement works this time. The Nuclear Regulatory Commission has been given the ability to restrict Russian fabricated fuel from entering the United States. Again, this is an effort to restrain Russian market penetration into the United States. The working group recommends streamlining burdensome regulatory processes that regulate U.S. uranium miners. Finally, and this cannot be emphasized enough, the report recommends periodically assessing the success of the programs to support domestic uranium miners and adjusting as needed to ensure success. Now I'll turn it over to Curtis Moore to discuss uranium markets and a little bit more about Energy Fuels.
Thank you, Paul. So the Nuclear Fuel Working Group Report is not the only tailwind for Energy Fuels. We think it is important for people to understand that Energy Fuels is not banking the company on U.S. government support. We have other catalysts. If the U.S. government provides U.S. uranium miners with an effective baseline of economic support through uranium purchases for the U.S. uranium reserve, the American Assured Fuel Supply, or other demand, Energy Fuels may be in a position to bring additional uranium production online that would be competitive in the global market. Ideally, we will have a blended portfolio of sales to the U.S. government and sales to U.S. utilities at appropriate prices, with some exposure to rising market prices.
In fact, we have seen uranium prices rise 30% in just the past 45 days or so due to mine and conversion facility shutdowns caused by the global pandemic. We don't know how long these shutdowns will last or how much uranium will ultimately be removed from the global market. However, uranium markets that were tightening before the pandemic began are now a lot tighter. And this could lead to significant price increases in the coming weeks and months. Next slide, please. So in light of all this, we believe, let's see here. Make sure I'm on the right slide here. There we go. So in light of all this, we believe Energy Fuels will be one of the natural beneficiaries of U.S. government support, including purchases for the U.S. uranium reserve.
The reason for our belief is that we hold proven uranium mines and production facilities, including the White Mesa Mill, which is the only uranium mill operating in America today. Our facilities are licensed, constructed, and have an excellent history of successful U.S. uranium production. Also, Energy Fuels has been leading the charge in getting the U.S. government to support our industry. We believe Energy Fuels' capabilities and our company's credibility when it comes to uranium production is one of the big reasons the U.S. government decided to support U.S. uranium miners. I'll quickly go through some of the themes of Energy Fuels. Again, we've been the largest uranium miner in the United States for the past three years. Since 2006, 34% of all U.S. uranium produced in the country has come from assets owned by Energy Fuels. This places us second only to Cameco.
And also, if you include a couple of the other companies that successfully brought on projects over that time period, like UR Energy and Uranium One, that accounts for 97% of all U.S. uranium produced over the past 15 years. So you can see who the real players are in the U.S. space. Again, this whole presentation is about this U.S. government commitment to support U.S. uranium miners. Again, that just can't be emphasized enough, how strong of a commitment this is. And Energy Fuels has a number of diverse business opportunities. We were the largest vanadium miner in 2019. We process alternate feed materials for the recovery of uranium. We're getting involved in some land cleanup work, including a large mine in northwest New Mexico and also a small pilot project in the Navajo Nation.
And if you've been following our story over the past few weeks, we're looking to evaluate the potential for processing rare earth elements at our White Mesa Mill. And we have a strong cash, working capital, and inventory positions, including $40.5 million of cash, marketable securities, and inventories as of December 31st, 2019. And we raised $19 million in the Q1 of 2020. We don't think that there's any other U.S. uranium miner that has nearly the balance sheet of Energy Fuels. Next slide, please. So on this slide, you can see Energy Fuels' footprint in the United States, which is the largest nuclear market in the world. We have three production facilities. This includes the White Mesa Mill in Utah, which is the only conventional uranium mill operating in the U.S. today. That's that blue star there in southeast Utah.
We also have a number of licensed and constructed conventional mines near the White Mesa Mill that will supply ore to the mill. In the short term, that would include the Canyon Mine in Arizona and the La Sal Complex in Utah. There are also several other conventional mines near the mill we don't own that could provide feed to the mill under toll milling or processing agreements. However, to be very, very clear, we have no such agreements in place, and no other uranium mining companies have the right to use the mill at this time. We also own two fully licensed and constructed ISR facilities. The Nichols Ranch project up in Wyoming is a great project that has produced 1.2 million pounds of uranium since 2014. We have the Alta Mesa project in Texas, which is currently on standby.
This is also a great project, which has produced almost 5 million pounds from 2005 to 2012. So I'll now turn it back over to Mark to finish up today's presentation. Next slide, please.
Thank you, Curtis. Look, many of you have seen this slide before, but it really says a lot when it comes to the proven track record of sustained U.S. uranium production and market leadership and the capacity to respond as the market improves and as, hopefully, we have exposure to some of these U.S. purchasing programs. Curtis covered off on the three fully licensed, fully constructed, and proven production facilities: White Mesa, Nichols Ranch, and Alta Mesa. No one has three production facilities like we do in our space in the United States. We have emerged as the largest producer over the last few years. Next slide. Curtis talked about our financial position. We're very proud of that. We're also very proud of the fact that we hold large inventories of uranium and large inventories of vanadium.
We plan to have pretty close to 700,000 pounds at the end of this year, maybe 650 to 700. Every time the price of uranium goes up, we value our working capital at $25 a pound for uranium. It's currently about $33. That gives us a substantial lift in our working capital every time the price of uranium goes up. Vanadium, same thing. We value it at $5 per pound in our working capital. Currently, it is $7 a pound. It has been rising significantly in the last week or two. Next slide. This slide, again, many of you have seen where we fit into the North American uranium producer sphere. Right in the middle in terms of market cap, you can see there where we have the strongest working capital position and the largest inventory position with the exception of Cameco.
And we have all these options now we're talking about: ISR, conventional, alternate feed. And we hope to add a tick for rare earths at some stage, which we think does not really get fully valued in the market amongst our peers. Next slide. Now, this kind of repeats some of the things that Curtis said, but I really like it because it says it all when it comes to uranium production over the last 15 years. The yellow line on this slide shows the spot price and the term price for uranium, how it dropped off after 2007, and particularly after Fukushima. As Curtis said, Cameco is in the gray, and we are in the blue. Between the two of us, we've produced 85% of all the uranium produced in the United States with our assets over the last 15 years.
Now, UR-Energy and Uranium One did not start producing until 2010 or 2011 and have also contributed materially. Between the four of us, we've produced 97% of all the uranium produced over the last 15 years, and even at periods when the price of uranium was well in excess of $33 per pound. There were three other producers, but they accounted for about 3% of the production during that period of time. We believe that companies with proven assets and proven production capabilities will be able to be in the best position for supplying the new U.S. uranium reserve. Energy Fuels is proud to count itself among those proven producers. Next slide. This is the final slide.
Again, summarizing what we've said on this call and many times in the past: unmatched ability to quickly increase low-cost uranium production, more production facilities, 3 of them in total, more resources, more production capacity, over 10 million pounds of production licensed capacity. We've been the largest producer over the past 4 years. We have a very strong balance sheet. We are, first and foremost, a uranium company, but we also have a successful track record of producing vanadium. The alternate feed, we're currently producing uranium from alternate feed at White Mesa Mill right now, proven business for us. The land cleanup, we've been doing that over the course of the last year. We hope to flex that up, and we think there's significant opportunity to flex that up. Trying to now bolt on.
Now, this is a lot of things for us to keep track of, but we have a proven history of keeping track of all these different optionality, and we're trying to expand it. Rare earths, which is a very real opportunity for us. We're very excited about that, but we're still going to remain focused as mainly a uranium-focused company. So now I'll finish up the presentation, and I'd like to open it up for questions at this time. So thank you very much for your interest in Energy Fuels and joining the conference call today. Thank you.
Thank you, Mr. Chalmers. Ladies and gentlemen, as stated, if you do have a question, please press star followed by one on your touch-tone phone. You will hear a three-tone prompt acknowledging your request. If you should wish to withdraw your question, simply press star followed by two. If you're using a speakerphone, we ask that you please lift the handset before pressing any keys. Please go ahead and press star now. Your first question will be from Mark Reichman at Noble Capital Markets. Please go ahead, Mark.
Good morning. I just wanted to focus on slide 8 first. You know, where they talk about the flexibility to add up to 17 million to 19 million pounds of uranium. So matching that against the budget allocation, theoretically, they could purchase 18 million at the midpoint for under $600 million at today's prices. So how do you link those two? Do you think that they would go in and just buy at the market price over time, and then as the price goes up, based on a lot of these other remedies that they're putting into place, that that's the way they would approach it? Or do you think that some people might look at that and just straight line it and say 18 million divided by $1.5 billion divided by 18 million, that's $83 a pound?
I tend to think the former, but I was just kind of interested in your thoughts on that.
Well, look, Mark, it's a bit unclear on how they'll actually implement these recommendations. Really, when you look at it with the budget and what was in the report at the 17 million to 19 million pounds, it is kind of unclear. The budget really says for mining and conversion. Now, we've been pressing that we would like that to start now, like in 2020. And I think the report did sort of talk about 2020 and then the budget at 2021. And we would like them to be in a position to purchase inventories, but we also want them to purchase at premiums, obviously, because the current prices don't really reflect replacement costs. So we have consistently said that the true value of a pound of uranium, particularly in the Western world, is north of $60 per pound.
But it is a bit unclear, but we think that it should be consistent over that period of time, relatively consistent. They can go back and review it, as the report says, as required. But it does include an element of conversion. And we believe and hope that the pricing is $60 or north of $60 a pound, which is the true value in the Western world, not necessarily with the state-owned enterprises.
And then the follow-up question is on the Russian Suspension Agreement. I believe it's capped at 20% currently. Where do you think that needs to go to really have an impact?
Look, it should not go up. It should go down. We should reduce our dependency on the Russians. But we believe, though, that if the Russians want to have greater access, they should pay for it in some capacity. Okay? Now, that's just my view. But we think it should go down. And I think the report reflects that it should go down. But if they want a bigger piece of the pie, they should pay for it. And that's about all I can say at this point in time.
But with the cap maxed out at 20% since, what, 1992, it really hasn't had much of an impact. Do you think if the cap was lowered to 15%, do you think that would make a meaningful difference?
Look, I think it'll make a difference, but I don't think how material it should make. I think the Russian Suspension Agreement is kind of morphing its way to where people are looking at it more from an enrichment perspective and other forms of uranium products. And because of that, I think that if they want to expand that, they should, as I said, pay to play.
Okay. Thank you very much.
Thank you. As a reminder, ladies and gentlemen, if you do have a question at this time, please press star followed by one on your touch-tone phone. And at this time, Mr. Chalmers, it appears we, oh, I'm sorry. We do have a question from Daniel Sekulich at The Northern Miner. Please go ahead, Daniel.
Hi. Mark, one of the big questions I think a lot of us observing this is, isn't this still dependent on Congress passing the budget? And do you think, given what's going on in terms of the polarization, as well as COVID relief and the presidential election, is there any chance this will actually happen?
Well, we think there's a good chance it will happen. But look, there are headwinds on some of these fronts. We're trying to focus on the bipartisan appropriations. We're in the appropriations process right now. This report helps us with that because it's a very strong report. And before the report came out, it was more difficult because we didn't have something to hold out. And there also is probably some room for some executive action by the president by having this report as well. Paul, would you like to add anything to that?
Yes. So from the appropriations point of view, there's a concern. There's already appropriations requests in to do these purchases for fiscal year 2021. If you'll note in the report that there's a desire by the administration to purchase uranium as soon as the calendar year 2020. There is a little overlap in the 2021 fiscal year starts on October 1st. There may be some overlap there, but we believe that there's a desire to get something moving sooner by the administration, but also several folks on the Capitol Hill. There are opportunities. There's possible energy titles and upcoming legislation that could provide avenues to put this funding in. But the reality is, under the U.S. Constitution, Congress holds the purse strings, and the president has some authority on where he reprograms money, but his authority is limited. So it is a process we have to go through.
We are already engaged in it as a company, but also the uranium industry as a whole.
Great. One follow-up as well. I noticed that neither Kazakhstan nor Canada are specifically mentioned in this roadmap, if you will. Do you think that's significant?
No, not particularly from my perspective. Yeah, Paul, go ahead.
No, I would say that that wasn't the focus of the report. It was focused on national security. Obviously, Canada has a long history of supporting U.S. national security. With respect to Kazakhstan, keep in mind that Uranium One, which is a Russian-owned state-owned company, has significant production coming out of Kazakhstan, even though it's not Russian-flagged. There could be some consideration with that as well. I don't see it being an issue that they're not mentioned in the report.
Great. Thank you.
Thank you. Next question is a follow-up from Mark at Noble Capital Markets. Please go ahead.
Thank you. The follow-up question is, the report mentions supporting two mines. So I was just wondering. I wanted to get your thoughts because, I mean, do you think the government would put all their eggs in one basket and support two mines at one producer, or do you think it would be a case where they try to diversify a little bit and have two suppliers supporting one mine at one producer and another mine at another, or is just the two mines? Do you think that's too narrow of a reading of the report?
Yeah. Look, we think that the two mines is two production centers. It doesn't necessarily mean exactly two mines. I think it's just two or more. I don't know how they're going to distribute this out. Again, you've got to be careful that you don't cut this up into too many pieces or you don't get the economics of scales for these different production centers. So I think that to fill the national reserve, two or three production centers is about all the load that it really can cover. So yeah, it's too early to tell exactly. I think, I don't know. I don't want to speculate, but I think that they've got to give a certain critical mass. And I think that point is indicating that it shouldn't be split into 10 pieces, in my opinion.
Thank you.
Hey, Mark. Yeah, this is Curtis here. If I could follow up real briefly, I'd second Mark Chalmers' comments there. But I'd also say that our White Mesa Mill is the only conventional uranium mill left in the United States. And I think it's pretty obvious that one facility in the United States that should receive support, it would be that one, plus a couple of additional ISR facilities, probably. But again, I think, like we're trying to emphasize, I think that White Mesa is certainly one of the obvious candidates for receiving some sort of support.
Yeah. And they do talk uranium mining and milling, and that's the only mill in the United States. So look, we believe that White Mesa is unique, not just as a uranium production center for conventional resources, but also vanadium is a critical mineral. And then all the other benefits of the recycling we do with alternate feed, land cleanup, and potentially rare earths, which is critical minerals as well. So we think it's a real true national security asset, without a doubt.
Well, I appreciate that. Thank you very much for the color in this call.
You're welcome, Mark.
Thank you. At this time, Mr. Chalmers, we have no other questions registered. Please proceed, sir.
All right. Well, look, everyone, thank you for joining the call. As we've said on earlier calls, we're really focused on trying to be available through these conference call mechanisms. But also feel free to call me directly if you have any other questions, myself or Paul or Curtis. We're always open. But again, we're very proud of how we are out there trying to make our luck as a company. We're very proud of our assets and the professionalism. And we're very pleased to have the interest in our company and as we move forward. So thank you very much and have a great day and stay safe.
Thank you, sir. Ladies and gentlemen, this does indeed conclude your conference call for today. Once again, thank you for attending. At this time, we do ask that you please disconnect your lines. Have a good weekend.