On August 2, 2013, the Company began production activities at its Lost Creek Project. Innovative design and development have focused on employee and environmental safety, water management practices, and advanced instrumentation monitoring and data capture. First sales of Lost Creek yellowcake were made in December 2013 and during the second quarter of 2015, Lost Creek achieved the milestone of producing its one millionth pound of U3O8 since production activities began.
The thrid quarter of 2015 is the eighth consecutive quarter of sales since operations began at Lost Creek. During the quarter, production was sourced from eleven header houses in the first mine unit; header house 11 was brought online in early September and construction is well underway on header house 12. After more than two years of operations, year-to-date plant head grades remained over 100 ppm despite having somewhat lower head grades in the third quarter. This is a typical result as mines mature and older operating patterns remain in the flow regime while newer patterns are brought online. This is also demonstrated through the quarter-over-quarter increasing average flowrates.
For the quarter, 172,282 pounds of U3O8 were captured within the Lost Creek plant; 176,850 pounds U3O8 were packaged in drums; and 184,380 pounds U3O8 of drummed inventory were shipped from the Lost Creek processing plant to the converter.
We continued to build inventory during the quarter towards a sustainable level that will allow us to meet contractual commitments or make discretionary spot sales. At September 30, inventory at the conversion facility was just over 102,782 pounds U3O8. Contract and spot sales from Lost Creek-produced U3O8 totaled 150,000 pounds at an average price of $56.39 per pound, for sales revenues of $8.46 million during the quarter.
The Lost Creek Project is part of the larger Lost Creek Property located in the Great Divide Basin, Wyoming which comprises six projects covering a total of approximately 42,000 acres (16,997 hectares): Lost Creek permit area (“Lost Creek Project”), EN, LC South, LC North, LC East and LC West. The uranium deposit at the Lost Creek Project is referred to as the Main Mineral Trend (“MMT”). The Company’s East Mineral Trend (the “EMT”) is a second mineral trend of significance. It was identified by historic drilling on the lands forming LC East. Although geologically similar, it appears to be a separate and independent trend from the MMT.
Lost Creek currently employs approximately 56 full time employees. The Company holds long-term sales contracts with several U.S. based nuclear utility companies, spanning the time frame 2013-2021, and anticipates making additional sales into spot market sales agreements. The uranium produced at the Lost Creek Project will ultimately become the fuel that provides clean energy for the nation’s power grid.
John Cooper, Ur-Energy Project Geologist, P.Geo., SME Registered Member and Qualified Person as defined by National Instrument 43-101, reviewed and approved the technical information contained on this webpage.