Energy Fuels lands $725M Pentagon loan for rare earths

Energy Fuels (NYSE: UUUU; TSX: EFR) shares jumped on Thursday after the U.S. Department of Defense announced a conditional loan commitment of up to $725 million to expand the company’s domestic rare earth processing operations and strengthen U.S. supply chains independent of China.

The financing, combined with additional private capital, is intended to support a new U.S.-based rare earth separation and metallization plant. Energy Fuels, historically a uranium producer, plans to expand into rare earth processing for permanent magnet manufacturing. The company must still satisfy financial, legal, technical and other due diligence requirements before the loan can close.

The stock rose 9.6% to C$23.69 in Toronto on Thursday morning, falling from initial gains and valuing the company at C$5.78 billion. The stock also surged this month after the company said it expects to meet its full-year uranium production guidance by mid-2026. Analysts forecast strong revenue growth over the coming quarters as the company ramps up high-margin uranium output and completes a series of strategic acquisitions.

“Energy Fuels’ expansion into rare earth midstream processing represents a key solution to a national bottleneck that needs to be rapidly addressed,” David A. Lorch, director of the Office of Strategic Capital at the defense department, said in a statement.

Supply chain

“Recent events have underscored the urgency of building durable supply chains for critical materials, and Energy Fuels is positioned to help lead that effort through a vertically integrated strategy,” Ross Bhappu, the company’s president and CEO, said in a separate statement.

The investment marks another step in the Trump administration’s effort to build a domestic mine-to-magnet supply chain as geopolitical tensions and export restrictions expose vulnerabilities in Western access to critical minerals.

The announcement follows a broader wave of government support for rare earth mining and processing after China moved to restrict exports of rare earth magnets, which are essential for electric vehicles, wind turbines, hard disk drives and medical imaging equipment.

Adds to uranium 

According to the Office of Strategic Capital, increased output from Energy Fuels would support permanent magnet facilities across the U.S. industrial base while improving access to materials used in defence and other advanced manufacturing sectors. The company already operates uranium processing and rare earth oxide separation facilities at its White Mesa Mill in Utah.

“This partnership drives an aggressive effort to close vulnerabilities in our industrial base and secure a resilient American supply chain for rare earth elements,” Emil Michael, Under Secretary of Defense for Research and Engineering, said in the same statement.

The financing also underscores the growing role of federal support in reshaping critical mineral supply chains. In fiscal 2026, the Office of Strategic Capital has committed more than $5 billion in debt financing and helped mobilize more than $11 billion in combined public and private capital for industrial and defence-related projects.