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.
For the seventh consecutive quarter, the Lost Creek Project made sales to meet its contractual commitments and, for the first time, sold 70,000 pounds of U3O8 into the spot market in June. During the second quarter 2015, 207,268 pounds of U3O8 were captured within the Lost Creek plant. The Company packaged and drummed 183,858 pounds and 179,672 pounds of drummed inventory were shipped to a conversion facility where 204,000 pounds were sold to utility customers. The Company also accelerated, from September to April, the delivery of 200,000 pounds at a price of $59.94. To fulfill the delivery, 200,000 pounds were purchased from a trader at the then current spot price, which generated net cash proceeds of approximately $4.0 million. In total, product sales for the quarter totaled 404,000 pounds at an average sales price of $45.08 per pound.
*Excludes severance and ad valorem cost per pound, which for 2014 averaged $2.48 per pound
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 11 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.