LITTLETON, Colo., July 27, 2018 /PRNewswire/
-- Ur-Energy Inc. (NYSE American:URG TSX:URE) ("Ur-Energy" or the "Company") has filed the Company's Form 10-Q for
the quarter ended June 30, 2018, with the U.S. Securities and Exchange Commission at www.sec.gov/edgar.shtml and Canadian securities
authorities on SEDAR at www.sedar.com.
Ur-Energy Chair and CEO, Jeffrey Klenda said, "In May, our third header house in mine unit two
came on line. Initial production results are encouraging and indicate that the new mine unit appears to have similar performance
characteristics to our prolific first mine unit. Additionally, we are pleased that the trade action investigation was initiated
following the end of the quarter. We look forward to a prompt resolution."
Lost Creek Uranium Production and Sales
Inventory, production and sales figures for the Lost Creek Project are presented in the following tables:
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Production and Production Costs
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Unit
|
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2018 Q2
|
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2018 Q1
|
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2017 Q4
|
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2017 Q3
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2018 YTD
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Pounds captured
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lb
|
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89,209
|
|
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84,047
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67,982
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|
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52,812
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|
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173,256
|
|
Ad valorem and severance tax
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$000
|
|
$
|
133
|
|
$
|
179
|
|
$
|
160
|
|
$
|
119
|
|
$
|
312
|
|
Wellfield cash cost (1)
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$000
|
|
$
|
516
|
|
$
|
671
|
|
$
|
686
|
|
$
|
743
|
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$
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1,187
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Wellfield non-cash cost (2)
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$000
|
|
$
|
400
|
|
$
|
403
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$
|
575
|
|
$
|
730
|
|
$
|
803
|
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Ad valorem and severance tax per pound captured
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$/lb
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$
|
1.49
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$
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2.13
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$
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2.35
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$
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2.25
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$
|
1.80
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Cash cost per pound captured
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$/lb
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$
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5.78
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$
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7.98
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|
$
|
10.09
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$
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14.07
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$
|
6.85
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Non-cash cost per pound captured
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$/lb
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$
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4.48
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$
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4.79
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$
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8.44
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|
$
|
13.82
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$
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4.63
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Pounds drummed
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lb
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74,302
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79,961
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60,461
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48,336
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154,263
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Plant cash cost (3)
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$000
|
|
$
|
1,230
|
|
$
|
1,226
|
|
$
|
1,210
|
|
$
|
1,120
|
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$
|
2,456
|
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Plant non-cash cost (2)
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$000
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$
|
493
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$
|
492
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$
|
493
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$
|
494
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$
|
985
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Cash cost per pound drummed
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$/lb
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$
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16.57
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$
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15.33
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$
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20.01
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$
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23.17
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$
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15.92
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Non-cash cost per pound drummed
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$/lb
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$
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6.64
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$
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6.15
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$
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8.15
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$
|
10.20
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$
|
6.39
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Pounds shipped to conversion facility
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lb
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74,416
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73,515
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73,367
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|
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36,797
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|
147,931
|
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Distribution cash cost (4)
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$000
|
|
$
|
34
|
|
$
|
19
|
|
$
|
48
|
|
$
|
24
|
|
$
|
53
|
|
Cash cost per pound shipped
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$/lb
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$
|
0.46
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$
|
0.26
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$
|
0.65
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|
$
|
0.65
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|
$
|
0.36
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|
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Pounds purchased
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lb
|
|
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100,000
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|
|
370,000
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|
|
-
|
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109,000
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|
470,000
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Purchase costs
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$000
|
|
$
|
2,225
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$
|
9,251
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|
$
|
-
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|
$
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2,196
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|
$
|
11,476
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Cash cost per pound purchased
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$/lb
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$
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22.25
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$
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25.00
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$
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-
|
|
$
|
20.15
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$
|
24.42
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Notes:
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1
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Wellfield cash costs include all wellfield operating costs. Wellfield
construction and development costs, which include wellfield drilling, header houses, pipelines, power lines, roads,
fences and disposal wells, are treated as development expense and are not included in wellfield operating
costs.
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2
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Non-cash costs include the amortization of the investment in the mineral
property acquisition costs and the depreciation of plant equipment, and the depreciation of their related asset
retirement obligation costs. The expenses are calculated on a straight line basis so the expenses are typically constant
for each quarter. The cost per pound from these costs will therefore typically vary based on production levels
only.
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3
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Plant cash costs include all plant operating costs and site overhead
costs.
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4
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Distribution cash costs include all shipping costs and costs charged by the
conversion facility for weighing, sampling, assaying and storing the U3O8 prior to sale.
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During the three months ended June 30, 2018, a total of 89,209 pounds of
U3O8 were captured within the Lost Creek plant. 74,302 pounds were packaged in drums and 74,416 pounds of
the drummed inventory were shipped to the conversion facility. We sold 100,000 pounds of purchased U3O8
during the period.
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Sales and cost of sales
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Unit
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2018 Q2
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2018 Q1
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2017 Q4
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2017 Q3
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2018 YTD
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Pounds sold
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lb
|
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100,000
|
|
|
380,000
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|
|
-
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289,000
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480,000
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U3O8 sales
|
|
$000
|
|
$
|
3,790
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|
$
|
19,663
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$
|
-
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|
$
|
11,674
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|
$
|
23,453
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Average contract price
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$/lb
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$
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37.90
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$
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52.50
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$
|
-
|
|
$
|
40.39
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|
$
|
49.39
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Average spot price
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$/lb
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$
|
-
|
|
$
|
23.75
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|
$
|
-
|
|
$
|
-
|
|
$
|
23.75
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Average price per pound sold
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$/lb
|
|
$
|
37.90
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|
$
|
51.74
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|
$
|
-
|
|
$
|
40.39
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|
$
|
48.86
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|
|
|
|
|
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|
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|
|
|
|
|
|
|
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U3O8 cost of sales (1)
|
|
$000
|
|
$
|
2,225
|
|
$
|
9,758
|
|
$
|
376
|
|
$
|
11,157
|
|
$
|
11,983
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|
Ad valorem and severance tax cost per pound sold
|
|
$/lb
|
|
$
|
-
|
|
$
|
2.30
|
|
$
|
-
|
|
$
|
3.15
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|
$
|
2.30
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Cash cost per pound sold
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$/lb
|
|
$
|
-
|
|
$
|
31.20
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|
$
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-
|
|
$
|
29.11
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$
|
31.20
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Non-cash cost per pound sold
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$/lb
|
|
$
|
-
|
|
$
|
17.20
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|
$
|
-
|
|
$
|
17.52
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|
$
|
17.20
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Cost per pound sold - produced
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$/lb
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|
$
|
-
|
|
$
|
50.70
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|
$
|
-
|
|
$
|
49.78
|
|
$
|
50.70
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|
Cost per pound sold - purchased
|
|
$/lb
|
|
$
|
22.25
|
|
$
|
25.00
|
|
$
|
-
|
|
$
|
20.15
|
|
$
|
24.42
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|
Average cost per pound sold
|
|
$/lb
|
|
$
|
22.25
|
|
$
|
25.68
|
|
$
|
-
|
|
$
|
38.61
|
|
$
|
24.96
|
|
|
|
|
|
|
|
|
|
|
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|
|
|
|
|
|
|
|
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U3O8 gross profit
|
|
$000
|
|
$
|
1,565
|
|
$
|
9,905
|
|
$
|
(376)
|
|
$
|
517
|
|
$
|
11,470
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|
Gross profit per pound sold
|
|
$/lb
|
|
$
|
15.65
|
|
$
|
26.06
|
|
$
|
-
|
|
$
|
1.78
|
|
$
|
23.90
|
|
Gross profit margin
|
|
%
|
|
|
41.3%
|
|
|
50.4%
|
|
|
0.0%
|
|
|
4.4%
|
|
|
48.9%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Ending Inventory Balances
|
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|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Pounds
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
In-process inventory
|
|
lb
|
|
|
43,733
|
|
|
28,937
|
|
|
26,796
|
|
|
22,306
|
|
|
|
|
Plant inventory
|
|
lb
|
|
|
15,391
|
|
|
15,504
|
|
|
9,043
|
|
|
21,948
|
|
|
|
|
Conversion facility inventory
|
|
lb
|
|
|
233,712
|
|
|
159,296
|
|
|
94,077
|
|
|
17,813
|
|
|
|
|
Total inventory
|
|
lb
|
|
|
292,836
|
|
|
203,737
|
|
|
129,916
|
|
|
62,067
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total cost
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
In-process inventory
|
|
$000
|
|
$
|
518
|
|
$
|
416
|
|
$
|
315
|
|
$
|
221
|
|
|
|
|
Plant inventory
|
|
$000
|
|
$
|
548
|
|
$
|
538
|
|
$
|
369
|
|
$
|
824
|
|
|
|
|
Conversion facility inventory
|
|
$000
|
|
$
|
8,738
|
|
$
|
6,044
|
|
$
|
3,831
|
|
$
|
675
|
|
|
|
|
Total inventory
|
|
$000
|
|
$
|
9,804
|
|
$
|
6,998
|
|
$
|
4,515
|
|
$
|
1,720
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cost per pound
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
In-process inventory
|
|
$/lb
|
|
$
|
11.84
|
|
$
|
14.38
|
|
$
|
11.76
|
|
$
|
9.92
|
|
|
|
|
Plant inventory
|
|
$/lb
|
|
$
|
35.61
|
|
$
|
34.70
|
|
$
|
40.81
|
|
$
|
37.53
|
|
|
|
|
Conversion facility inventory
|
|
$/lb
|
|
$
|
37.39
|
|
$
|
37.94
|
|
$
|
40.72
|
|
$
|
37.89
|
|
|
|
|
|
|
Note:
|
|
1
|
Cost of sales include all production costs (notes 1, 2, 3 and 4 in the
previous Production and Production Cost table) adjusted for changes in inventory values.
|
U3O8 sales of $3.8 million for 2018 Q2 were based on selling 100,000
pounds at an average price of $37.90. The pounds were sold under term contracts and were
purchased for an average price of $22.25 per pound for a total cost of sales of $2.2 million.
|
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|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Total Cost Per Pound Sold
Reconciliation
|
|
Unit
|
|
2018 Q2
|
|
2018 Q1
|
|
2017 Q4
|
|
2017 Q3
|
|
2018 YTD
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Ad valorem & severance taxes
|
|
$000
|
|
$
|
133
|
|
$
|
179
|
|
$
|
160
|
|
$
|
119
|
|
$
|
312
|
Wellfield costs
|
|
$000
|
|
$
|
916
|
|
$
|
1,074
|
|
$
|
1,260
|
|
$
|
1,473
|
|
$
|
1,990
|
Plant and site costs
|
|
$000
|
|
$
|
1,723
|
|
$
|
1,718
|
|
$
|
1,703
|
|
$
|
1,614
|
|
$
|
3,441
|
Distribution costs
|
|
$000
|
|
$
|
34
|
|
$
|
19
|
|
$
|
48
|
|
$
|
24
|
|
$
|
53
|
Inventory change
|
|
$000
|
|
$
|
(2,806)
|
|
$
|
(2,483)
|
|
$
|
(2,795)
|
|
$
|
5,731
|
|
$
|
(5,289)
|
Cost of sales - produced
|
|
$000
|
|
$
|
—
|
|
$
|
507
|
|
$
|
376
|
|
$
|
8,961
|
|
$
|
507
|
Cost of sales - purchased
|
|
$000
|
|
$
|
2,225
|
|
$
|
9,251
|
|
$
|
—
|
|
$
|
2,196
|
|
$
|
11,476
|
Total cost of sales
|
|
$000
|
|
$
|
2,225
|
|
$
|
9,758
|
|
$
|
376
|
|
$
|
11,157
|
|
$
|
11,983
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Pounds sold produced
|
|
lb
|
|
|
—
|
|
|
10,000.00
|
|
|
—
|
|
|
180,000
|
|
|
10,000
|
Pounds sold purchased
|
|
lb
|
|
|
100,000
|
|
|
370,000.00
|
|
|
—
|
|
|
109,000
|
|
|
470,000
|
Total pounds sold
|
|
lb
|
|
|
100,000
|
|
|
380,000.00
|
|
|
—
|
|
|
289,000
|
|
|
480,000
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Average cost per pound sold - produced (1)
|
|
$/lb
|
|
$
|
-
|
|
$
|
50.70
|
|
$
|
-
|
|
$
|
49.78
|
|
$
|
50.70
|
Average cost per pound sold - purchased
|
|
$/lb
|
|
$
|
22.25
|
|
$
|
25.00
|
|
$
|
-
|
|
$
|
20.15
|
|
$
|
24.42
|
Total average cost per pound sold
|
|
$/lb
|
|
$
|
22.25
|
|
$
|
25.68
|
|
$
|
-
|
|
$
|
38.61
|
|
$
|
24.96
|
|
|
Note:
|
|
1
|
The cost per pound sold reflects both cash and non-cash costs, which are
combined as cost of sales in the statement of operations included in this filing. The cash and non-cash cost
components are identified in the above inventory, production and sales table.
|
The cost of sales includes ad valorem and severance taxes related to the extraction of uranium, all costs of wellfield, plant
and site operations including the related depreciation and amortization of capitalized assets, reclamation and mineral property
costs, plus product distribution costs. These costs are also used to value inventory and the resulting inventoried cost per pound
is compared to the estimated sales prices based on the contracts or spot sales anticipated for the distribution of the product.
Any costs in excess of the calculated market value are charged to cost of sales.
Continuing Guidance for 2018
At the end of the second quarter of 2018, the average spot price of U3O8, as reported by Ux Consulting
Company, LLC and TradeTech, LLC, was approximately $22.65 per pound. Market fundamentals have not
changed sufficiently to warrant the accelerated development of MU2. We anticipate meeting our projected production level of
250,000 to 300,000 pounds drummed for the year.
Through June 30, 2018, we sold 470,000 pounds of U3O8 under term contracts
at an average price of approximately $49.39 per pound and 10,000 pounds of
U3O8 under a spot sale for $23.75 per pound. We purchased 470,000 pounds at
an average cost of $24.42 per pound. The remaining 10,000 pounds were delivered from our produced
inventory. We have no more contract sales scheduled in 2018.
The third of three planned MU2 header houses was brought into production in Q2. No additional new production areas are
currently planned for the remainder of the year. Production guidance for Q3 is between 70,000 and 80,000 pounds
U3O8 dried and drummed. Full year 2018 guidance, similar to 2017, estimates production of between 250,000
and 300,000 pounds, but our production rate may be adjusted based on operational matters and other indicators in the market.
As at July 26, 2018, our unrestricted cash position was $6.3
million.
About Ur-Energy
Ur-Energy is a uranium mining company operating the Lost Creek in-situ recovery uranium facility in south-central
Wyoming. We have produced, packaged and shipped more than 2.4 million pounds from Lost Creek
since the commencement of operations. Applications are under review by various agencies to incorporate our LC East project area
into the Lost Creek permits, and we have begun to submit applications for permits and licenses to construct and operate at our
Shirley Basin Project. Ur-Energy is engaged in uranium mining, recovery and processing activities, including the acquisition,
exploration, development and operation of uranium mineral properties in the United States.
Shares of Ur-Energy trade on the NYSE American under the symbol "URG" and on the Toronto Stock Exchange under the symbol "URE."
Ur-Energy's corporate office is located in Littleton, Colorado; its registered office is in
Ottawa, Ontario. Ur-Energy's website is www.ur-energy.com .
FOR FURTHER INFORMATION, PLEASE CONTACT
Jeffrey Klenda, Chair and CEO
866-981-4588
Jeff.Klenda@ur-energy.com
Cautionary Note Regarding Forward-Looking Information
This release may contain "forward-looking statements" within the meaning of applicable securities laws regarding events or
conditions that may occur in the future (e.g., results of production, including whether mine unit two continues to perform
and realize production results similar to mine unit one; timing and results of our efforts to permit future operations at LC East
and Shirley Basin) and are based on current expectations that, while considered reasonable by
management at this time, inherently involve a number of significant business, economic and competitive risks, uncertainties and
contingencies. Factors that could cause actual results to differ materially from any forward-looking statements include, but are
not limited to, capital and other costs varying significantly from estimates; failure to establish estimated resources and
reserves; the grade and recovery of ore which is mined varying from estimates; production rates, methods and amounts varying from
estimates; delays in obtaining or failures to obtain required governmental, environmental or other project approvals; inflation;
changes in exchange rates; fluctuations in commodity prices; delays in development and other factors described in the public
filings made by the Company at www.sedar.com and www.sec.gov. Readers should not place undue reliance on forward-looking
statements. The forward-looking statements contained herein are based on the beliefs, expectations and opinions of management as
of the date hereof and Ur-Energy disclaims any intent or obligation to update them or revise them to reflect any change in
circumstances or in management's beliefs, expectations or opinions that occur in the future.
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SOURCE Ur-Energy Inc.