enCore Energy (NASDAQ:EU) - Two Wellfields Ready, Restart Waits on Texas Permits

William Sheriff (0:00)

Hello, I'm William Sheriff, Executive Chairman of EnCore Energy. We're one of the leading ISR producers in the United States.

Looking forward to an incredible run in the next 10 years with the supply-demand shortage, especially in the United States, where it's the most critical and the largest consumer of nuclear power in the world.

SPEAKER_2 (0:21)

Bill, how are you?

William Sheriff (0:22)

Doing well, Matt. Good to see you.

SPEAKER_2 (0:24)

We made it. We made it to the end of the week. We're here at Beaver Creek. We did indeed. Lots of meetings, lots of good meetings, I hope, for you. What do you think of it?

William Sheriff (0:32)

Absolutely. I think it's probably been the best one, most productive one that we've had here, and we've been coming here for years. I don't know how long, I think probably since inception. But it was really, really good outcome.

SPEAKER_2 (0:43)

Why do you think that is? What's changed?

William Sheriff (0:45)

Well, Jan, I don't know. Metal prices might have a bit to do with it. I mean, this happens every time gold hits $4,000 or $5,000, right?

This being the first time. Yeah.

SPEAKER_2 (0:55)

And you've got a bunch of stories you can talk to people at the house. What were you kind of focused on here?

William Sheriff (1:00)

Well, I mean, EnCore certainly has had its share of intrigue this year. It has. In another way and, you know, change and, you know, why? Why is a very common question relating to several subjects? And so, you know, things are on the right track and we want to get that message out. And certainly have met with a lot of large shareholders and explained the concept of ETFs a lot too, quite frankly.

SPEAKER_2 (1:24)

We'll come to that. We'll come to that. I think first, let's talk about management change. Sure. Okay, because not the first time.

William Sheriff (1:31)

No, it's not. What's going on? And, you know, we, I think last time we talked, we just made that change and we brought in our Petroleum Engineer, Reservoir Engineer, which is what we'd like to have found the first time and, in fact, did, the same gentleman.

Then we had decided to give who had been our interim CEO a shot. And we gave it to him and, you know, the board decided that they wanted to do something else. I'd actually left for a short period of time and the board had asked me to try and help recruit Rich, who's joined us, because he fit all the marks for what we were looking for. And so I got a hold of him and he worked with the board for a couple of weeks and then they worked something out, but he was only going to come on board if I came back. So I came back and, quite frankly, I really enjoyed working with him. We see things pretty close and he's a very serious operator.

SPEAKER_2 (2:19)

So what's the brief to him?

William Sheriff (2:21)

Sorry?

SPEAKER_2 (2:21)

What's the brief? What do you ask him to do?

William Sheriff (2:24)

Well, basically run the company and organize it. We need to have an experienced CEO.

SPEAKER_2 (2:29)

It's been a CEO, but what can he bring to move Encore on to the next step?

William Sheriff (2:34)

Quite a few things. First things, you have to clean up a bit of the mess that was there. And quite frankly, we were over-staffed during the first month or two this past year, we hired 39 people in about a month, which was incredibly excessive. So we had a major layoff, or a right sizing if you will. And those are never pleasant. But nonetheless, we had about 20, 24% reduction in staff, and that was across the board, so officers as well as workers.

And that showed a bit of seriousness in moving forward, which is always a real boost for morale, in my opinion. You certainly have a bit of a question during the reduction. But after that, when you see things are moving smoother, running like more approaching a well-oiled machine, then the people start working a little bit happier, and happier workers are better.

SPEAKER_2 (3:25)

Okay. Well, that stuff's in your control. The stuff that's out of your control, there's three letters, three letters, ETF.

What happened?

William Sheriff (3:35)

Well, we came out and we were delayed due to previous issues with management and previous ways of interpreting how you want to work with our environmental control people who have been very good over the history of our operations.

There was a stumbling block in who was right and who was wrong. And when Rich came in, I said, I don't know who was right and who was wrong. We need to do what we need to do. Let's get those wells drilled. And he'd ask, what should I do? Where should I begin? And that was the first thing. And we were pretty clear in our Q2 report that it was going to delay our production. We've got three well fields, two of which, one at Alta Mesa and one at Upper Spring Creek, which will be our new satellite plant. Biggest one we've built. It's built. It's completed. The well field's in. It's readying to, to quote, flip the switch. It's been expensed. It had been at the end of the second quarter, as we reported. And similarly, Wellfield 3 Extension at Alta Mesa is fully drilled. It's ready to flip the switch. And we're awaiting permits. But they'd become a loggerhead with the permitting agency. Here again, somewhat of a self-induced gunshot wound.