Anfield Energy (TSX-Venture:AEC) (OTCQB:ANLDF)
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Featured Company / Anfield Energy

Without much ado, uranium has quietly been a strong performer in 2018.  According to nuclear fuel consultancy Ux Consulting, the weekly spot price has risen from $23.75 per pound on December 25, 2017 to $29.10 per pound on November 12, 2018, an increase of 22.5 percent.  After facing tough headwinds that drove the price to near $18 in November, 2016, the price has rebounded as the market finally seems to better understand an imbalance in supply and demand that was years in the making, triggered in part by the Fukushima disaster in Japan in 2011.  Looking forward, the future of uranium, the key ingredient in the fuelling of nuclear power plants, looks brighter than it has in a long time.

That thesis is underscored by Kazakhstan-based Kaztomprom, the world’s largest producer of natural uranium, this month becoming the first Kazakh national company to list on an international exchange.  The uranium giant placed 15 percent of its shares worth $451 million on the London Stock Exchange.  Demand for the stock soared, as Kazakh investors bought nearly 48 percent of the total shares and removed the Samruk Kazyna Sovereign Wealth Fund as the company’s sole shareholder.

Kaztomprom has shifted its focus from volume to value, a move that has supported higher uranium prices, cutting production 20 percent to better align with demand.  In that same vein, Saskatchewan, Canada-based uranium juggernaut Cameco (TSX:CCO)(NYSE:CCJ) early this year suspended production at both its Rabbit Lake mine and McArthur River, the world’s biggest uranium mine, in its home province for an “indeterminate duration,” a decision that analysts estimate will take about 13.7 million pounds of uranium from the market from the shuttering in February through the end of the year.

After years of hesitance to reduce production, the downturn in prices forced the hands of many leading players to take action. This was due in large part to the fact that the vast majority of uranium sales are conducted via long-term (up to 10 years) contracts, not on the spot market.  These contracts typically command much higher prices, but the protracted depressed price for uranium was making mining it unprofitable.

Supply cuts mean utilities have to compete for product from a smaller supply pool.

Production cuts to better balance global supply and demand are only part of the equation as to why investors need to be looking at uranium assets.   The Trump administration’s mantra of “America First” also plays a considerable role.  Trump’s position to leverage tariffs and his Executive Order mandating domestic production of key metals – including uranium – as a matter of national security and reducing dependence on imports are widely documented.

To that point, Trump is looking to produce uranium in the U.S. and cut Russian-controlled uranium from the mix.  The domestic opportunity is substantial to say the least when considering that the U.S imported about 90 percent of its uranium for nuclear reactors in 2016.  42 percent of that total, or roughly 21.3 million pounds, came from Kazakhstan (24%) and Uzbekistan (4%), two former Soviet republics still subsidized by Russia, and Russia directly (14%).

U.S. uranium producers are on board, aiming to rally more support in Washington, D.C. to change the supply chain for U.S. reactors.  In January Ur-Energy Inc. (NYSE American:URG)(TSX:URE) and Energy Fuels Inc. (NYSE American:UUUU)(TSX:EFR) filed a petition with the Department of Commerce for the purpose of implementing limitations on imports.  The period for public comments on the petition closed on September 25, putting the matter into the hands of lawmakers now.

Speaking of reactors, there are more than 450 in operation today, according to the World Nuclear Association, with 58 more under construction.  Energia Market Research forecasts that the nuclear energy market will reach $205.2 billion by 2024 as countries continue to look to the emission-free, zero-carbon metal for clean energy needs.  The U.S. Commerce Department reportedly has applications for 20 new nuclear reactors.  China, which has a major air pollution problem it is desperately trying to curtail, is particularly aggressive in looking at nuclear, saying it wants to build seven reactors each year through 2020, an initiative it has earmarked $78 billion to accomplish.

In fairness, the additions don’t factor in decommissioning of any existing plants, but it is clear that there will be more reactors online in the coming years, which portends for more uranium consumption going forward.

Depressed prices presented an incredible opportunity for Anfield Energy (TSX-Venture:AEC) (OTCQB:ANLDF) to make valuable acquisitions for a song.  The asset base and improving uranium market likely were the reasons that shares of Anfield shot up in June and July, moving from a low of 19 cents to as high as 59 cents.  Even at the 52-week high, it’s arguable that Anfield was deeply undervalued at approximately a $26 million market cap, much less about half of that at its current share price of 26 cents.

It’s not hyperbole to say that Anfield has the potential to become a leading uranium producer in the U.S. due to its portfolio of 25 in-situ resource (ISR) uranium projects in Wyoming.  The flagship property is the Charlie Project in Wyoming, acquired from Cotter Corp. earlier this year, a formidable asset all on its own, much less alongside two dozen other projects, many of which already have National Instrument reports detailing resources and/or economics and historic uranium resources to the tune of in excess of 30 million pounds. 

The 720-acre Charlie Project consists of a Wyoming State uranium lease that has been in development for nearly 50 years and is situated directly adjacent to two producing mines of Uranium One.

According to a recent NI 43-101 report on Charlie, the project has a resource estimate including an Indicated mineral resource of 1.26 million tons of mineralized material grading an average of 0.123% eU3O8 (equivalent to an Indicated Resource of 3.1 million pounds of eU3O8).  U3O8 is geologist-speak for triuranium octoxide, a compound of uranium and popular form of “yellowcake” refined and used in nuclear reactors, amongst other things.

Charlie also has an Indicated mineral resource of 1.26 million tons of mineralized material with an average grade of 0.123% eU3O8 (equivalent to an Indicated Resource of 3,100,000 pounds of eU3O8) and an Inferred mineral resource of 558,000 tons of mineralized material with an average grade of 0.125% eU3O8 (equivalent to an Inferred Resource of 1,400,000 pounds of eU3O8). 

Furthermore, the project has an exploration target ranging from 280,000 to 680,000 tons with an average grade ranging from 0.090 to 0.151 %eU3O8 (equivalent to an Exploration Target ranging from 500,000 to 1,300,000 pounds of eU3O8).

The company’s Wyoming projects got a shot in the arm last month when Wyoming Governor, Matt Mead, signed an agreement with the United States Nuclear Regulatory Commission, which gives the Wyoming Department of Environmental Quality the authority to regulate uranium recovery operations in Wyoming.  The development provides a better pathway to production for Anfield, as it will shorten the timeline for licensing and permitting.

For the sake of brevity, we won’t go into all the other projects in Wyoming, but it should be understood that Charlie is the lead spoke in what Anfield intends to develop into a mining wheel of ISR projects, which come with lower capex and opex, in the state.

Perhaps the most compelling, undervalued and overlooked part of Anfield is the Shootaring Canyon Mill in Garfield County, Utah.  Combined with Anfield’s access to 500,000 pounds of annual production capacity at Uranium One’s Irigary ISR processing plant in Wyoming (not to mention the surrounding infrastructure of and supply pact with Uranium One), Shootaring makes Anfield an integrated uranium company.  That statement should not be taken lightly considering that there are only two other licensed conventional uranium mills in the entire U.S.

The Shootaring mill was constructed in the 1980s and acquired along with some uranium fields by Uranium One in 2007 for approximately $101 million.  Striking while the iron was hot, Anfield snagged the mill and assets from Uranium One in 2015 for just $7.5 million in a cash-and-stock deal.  Management believes that the mill can be rehabbed to optimal operations today with annual production capacity of one million pounds at a significantly lower cost than the $200 million (and 7-8 years, if an approval can even be garnered) to build one from scratch.

Anfield has been practical and prescient in every stage of executing its business model.  Not only are there the ISR projects that can deliver production in short order at a relatively low cost, but the company has a supply-and-borrow agreement with Uranium One.  In short, this simply means that if Anfield strikes a supply agreement with a utility (or any other uranium purchaser), Uranium One is in its corner to ensure that the supply agreement is fulfilled.  Having an international behemoth backstopping a supply agreement is just one more feather in the cap of a company that certainly doesn’t look or act like one sporting a market capitalization under $10 million.  Take any one of the main parts of the company’s portfolio and it could easily be valued at a higher amount, much less the aggregate of all that Anfield owns.

The overarching fact for Anfield is that if it is successful in achieving the 1.5 million pounds of annual production it believes it can through Shootaring and ISR production access, it will be a top-5 uranium producer in the U.S.  That is something to be optimistic about as the whole U.S. supply paradigm appears ready for a dramatic shift, one that will greatly benefit companies entrenched in domestic production, like Anfield is.

Corporate Snapshot:
Anfield Energy
Stock Symbol: AEC
Stock Exchange: TSX-Venture
Sector: Basic Materials
52 Week High: $0.5900
52 Week Low: $0.1900
Alt Exchange/Ticker: OTCQB:ANLDF

Current Stock Quote / Chart / News: Click here

Information as of November 27, 2018

Without much ado, uranium has quietly been a strong performer in 2018.  According to nuclear fuel consultancy Ux Consulting, the weekly spot price has risen from $23.75 per pound on December 25, 2017 to $29.10 per pound on November 12, 2018, an increase of 22.5 percent.  After facing tough headwinds that drove the price to near $18 in November, 2016, the price has rebounded as the market finally seems to better understand an imbalance in supply and demand that was years in the making, triggered in part by the Fukushima disaster in Japan in 2011.  Looking forward, the future of uranium, the key ingredient in the fuelling of nuclear power plants, looks brighter than it has in a long time.

That thesis is underscored by Kazakhstan-based Kaztomprom, the world’s largest producer of natural uranium, this month becoming the first Kazakh national company to list on an international exchange.  The uranium giant placed 15 percent of its shares worth $451 million on the London Stock Exchange.  Demand for the stock soared, as Kazakh investors bought nearly 48 percent of the total shares and removed the Samruk Kazyna Sovereign Wealth Fund as the company’s sole shareholder.

Kaztomprom has shifted its focus from volume to value, a move that has supported higher uranium prices, cutting production 20 percent to better align with demand.  In that same vein, Saskatchewan, Canada-based uranium juggernaut Cameco (TSX:CCO)(NYSE:CCJ) early this year suspended production at both its Rabbit Lake mine and McArthur River, the world’s biggest uranium mine, in its home province for an “indeterminate duration,” a decision that analysts estimate will take about 13.7 million pounds of uranium from the market from the shuttering in February through the end of the year.

After years of hesitance to reduce production, the downturn in prices forced the hands of many leading players to take action. This was due in large part to the fact that the vast majority of uranium sales are conducted via long-term (up to 10 years) contracts, not on the spot market.  These contracts typically command much higher prices, but the protracted depressed price for uranium was making mining it unprofitable.

Supply cuts mean utilities have to compete for product from a smaller supply pool.

Production cuts to better balance global supply and demand are only part of the equation as to why investors need to be looking at uranium assets.   The Trump administration’s mantra of “America First” also plays a considerable role.  Trump’s position to leverage tariffs and his Executive Order mandating domestic production of key metals – including uranium – as a matter of national security and reducing dependence on imports are widely documented.

To that point, Trump is looking to produce uranium in the U.S. and cut Russian-controlled uranium from the mix.  The domestic opportunity is substantial to say the least when considering that the U.S imported about 90 percent of its uranium for nuclear reactors in 2016.  42 percent of that total, or roughly 21.3 million pounds, came from Kazakhstan (24%) and Uzbekistan (4%), two former Soviet republics still subsidized by Russia, and Russia directly (14%).

U.S. uranium producers are on board, aiming to rally more support in Washington, D.C. to change the supply chain for U.S. reactors.  In January Ur-Energy Inc. (NYSE American:URG)(TSX:URE) and Energy Fuels Inc. (NYSE American:UUUU)(TSX:EFR) filed a petition with the Department of Commerce for the purpose of implementing limitations on imports.  The period for public comments on the petition closed on September 25, putting the matter into the hands of lawmakers now.

Speaking of reactors, there are more than 450 in operation today, according to the World Nuclear Association, with 58 more under construction.  Energia Market Research forecasts that the nuclear energy market will reach $205.2 billion by 2024 as countries continue to look to the emission-free, zero-carbon metal for clean energy needs.  The U.S. Commerce Department reportedly has applications for 20 new nuclear reactors.  China, which has a major air pollution problem it is desperately trying to curtail, is particularly aggressive in looking at nuclear, saying it wants to build seven reactors each year through 2020, an initiative it has earmarked $78 billion to accomplish.

In fairness, the additions don’t factor in decommissioning of any existing plants, but it is clear that there will be more reactors online in the coming years, which portends for more uranium consumption going forward.

Depressed prices presented an incredible opportunity for Anfield Energy (TSX-Venture:AEC) (OTCQB:ANLDF) to make valuable acquisitions for a song.  The asset base and improving uranium market likely were the reasons that shares of Anfield shot up in June and July, moving from a low of 19 cents to as high as 59 cents.  Even at the 52-week high, it’s arguable that Anfield was deeply undervalued at approximately a $26 million market cap, much less about half of that at its current share price of 26 cents.

It’s not hyperbole to say that Anfield has the potential to become a leading uranium producer in the U.S. due to its portfolio of 25 in-situ resource (ISR) uranium projects in Wyoming.  The flagship property is the Charlie Project in Wyoming, acquired from Cotter Corp. earlier this year, a formidable asset all on its own, much less alongside two dozen other projects, many of which already have National Instrument reports detailing resources and/or economics and historic uranium resources to the tune of in excess of 30 million pounds. 

The 720-acre Charlie Project consists of a Wyoming State uranium lease that has been in development for nearly 50 years and is situated directly adjacent to two producing mines of Uranium One.

According to a recent NI 43-101 report on Charlie, the project has a resource estimate including an Indicated mineral resource of 1.26 million tons of mineralized material grading an average of 0.123% eU3O8 (equivalent to an Indicated Resource of 3.1 million pounds of eU3O8).  U3O8 is geologist-speak for triuranium octoxide, a compound of uranium and popular form of “yellowcake” refined and used in nuclear reactors, amongst other things.

Charlie also has an Indicated mineral resource of 1.26 million tons of mineralized material with an average grade of 0.123% eU3O8 (equivalent to an Indicated Resource of 3,100,000 pounds of eU3O8) and an Inferred mineral resource of 558,000 tons of mineralized material with an average grade of 0.125% eU3O8 (equivalent to an Inferred Resource of 1,400,000 pounds of eU3O8). 

Furthermore, the project has an exploration target ranging from 280,000 to 680,000 tons with an average grade ranging from 0.090 to 0.151 %eU3O8 (equivalent to an Exploration Target ranging from 500,000 to 1,300,000 pounds of eU3O8).

The company’s Wyoming projects got a shot in the arm last month when Wyoming Governor, Matt Mead, signed an agreement with the United States Nuclear Regulatory Commission, which gives the Wyoming Department of Environmental Quality the authority to regulate uranium recovery operations in Wyoming.  The development provides a better pathway to production for Anfield, as it will shorten the timeline for licensing and permitting.

For the sake of brevity, we won’t go into all the other projects in Wyoming, but it should be understood that Charlie is the lead spoke in what Anfield intends to develop into a mining wheel of ISR projects, which come with lower capex and opex, in the state.

Perhaps the most compelling, undervalued and overlooked part of Anfield is the Shootaring Canyon Mill in Garfield County, Utah.  Combined with Anfield’s access to 500,000 pounds of annual production capacity at Uranium One’s Irigary ISR processing plant in Wyoming (not to mention the surrounding infrastructure of and supply pact with Uranium One), Shootaring makes Anfield an integrated uranium company.  That statement should not be taken lightly considering that there are only two other licensed conventional uranium mills in the entire U.S.

The Shootaring mill was constructed in the 1980s and acquired along with some uranium fields by Uranium One in 2007 for approximately $101 million.  Striking while the iron was hot, Anfield snagged the mill and assets from Uranium One in 2015 for just $7.5 million in a cash-and-stock deal.  Management believes that the mill can be rehabbed to optimal operations today with annual production capacity of one million pounds at a significantly lower cost than the $200 million (and 7-8 years, if an approval can even be garnered) to build one from scratch.

Anfield has been practical and prescient in every stage of executing its business model.  Not only are there the ISR projects that can deliver production in short order at a relatively low cost, but the company has a supply-and-borrow agreement with Uranium One.  In short, this simply means that if Anfield strikes a supply agreement with a utility (or any other uranium purchaser), Uranium One is in its corner to ensure that the supply agreement is fulfilled.  Having an international behemoth backstopping a supply agreement is just one more feather in the cap of a company that certainly doesn’t look or act like one sporting a market capitalization under $10 million.  Take any one of the main parts of the company’s portfolio and it could easily be valued at a higher amount, much less the aggregate of all that Anfield owns.

The overarching fact for Anfield is that if it is successful in achieving the 1.5 million pounds of annual production it believes it can through Shootaring and ISR production access, it will be a top-5 uranium producer in the U.S.  That is something to be optimistic about as the whole U.S. supply paradigm appears ready for a dramatic shift, one that will greatly benefit companies entrenched in domestic production, like Anfield is.


Forward Looking Statements

This report includes forward-looking statements that reflect current expectations about its future results, performance, prospects and opportunities. Anfield Energy has tried to identify these forward-looking statements by using words and phrases such as "may," "will," "expects," "anticipates," "believes," "intends," "estimates," "plan," "should," "typical," "preliminary," "we are confident" or similar expressions. These forward-looking statements are based on information currently available and are subject to a number of risks, uncertainties and other factors that could cause Anfield Energy's actual results, performance, prospects or opportunities to differ materially from those expressed in, or implied by, these forward-looking statements. These risks, uncertainties and other factors include, without limitation, the Company's growth expectations and ongoing funding requirements, and specifically, the Company's growth prospects with scalable customers, and those outlined above. Other risks include the Company's limited operating history, the Company's history of operating losses, consumers' acceptance, the Company's use of licensed technologies, risk of increased competition, the potential need for additional financing, the terms and conditions of any financing that is consummated, the limited trading market for the Company's securities, the possible volatility of the Company's stock price, the concentration of ownership, and the potential fluctuation in the Company's operating results.

Disclaimer

AllPennyStocks.com feature stock reports are intended to be stock ideas, NOT recommendations. Please do your own research before investing. It is crucial that you at least look at current SEC filings and read the latest press releases. Information contained in this report was extracted from current documents filed with the SEC, the company web site and other publicly available sources deemed reliable. For more information see our disclaimer section, a link of which can be found on our web site. This document contains forward-looking statements, particularly as related to the business plans of the Company, within the meaning of Section 27A of the Securities Act of 1933 and Sections 21E of the Securities Exchange Act of 1934, and are subject to the safe harbor created by these sections. Actual results may differ materially from the Company's expectations and estimates. This is an advertisement for Anfield Energy The purpose of this advertisement, like any advertising, is to provide coverage and awareness for the company. The information provided in this advertisement is not intended for distribution to, or use by, any person or entity in any jurisdiction or country where such distribution or use would be contrary to law or regulation or which would subject us to any registration requirement within such jurisdiction or country.

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