Ur-Energy
Inc.
(a
Development Stage Company)
Management’s
Discussion and Analysis
December
31, 2008
(expressed
in Canadian dollars)
UR-ENERGY
INC.
MANAGEMENT’S
DISCUSSION AND ANALYSIS
For
the Year Ended December 31, 2008
(Information as at March 18,
2009 unless otherwise noted)
Introduction
The
following provides management’s discussion and analysis of results of operations
and financial condition for the years ended December 31, 2008, 2007 and
2006. Management’s Discussion and Analysis was prepared by Company
management and approved by the Board of Directors on March 18,
2009. This discussion and analysis should be read in conjunction with
the Company’s audited consolidated financial statements for the years ended
December 31, 2008, 2007 and 2006. All figures are presented in
Canadian dollars, unless otherwise noted, and are in accordance with Canadian
generally accepted accounting principles.
In
December 2008, the Company changed its policy for accounting for exploration and
development expenditures. In prior years, the Company capitalized all
direct exploration and development expenditures. Under its new
policy, exploration, evaluation and development expenditures, including annual
exploration license and maintenance fees, are charged to earnings as incurred
until the mineral property becomes commercially mineable. Management considers
that a mineral property will become commercially mineable when it can be legally
mined, as indicated by the receipt of key permits. This change has
been applied retroactively and all comparative amounts in this Management’s
Discussion and Analysis (“MD&A”) have been restated to give effect to this
change. These changes are discussed more fully under the heading
“Changes in Accounting Policies Including Initial Adoption”.
The
Company was incorporated on March 22, 2004 and completed its first year-end on
December 31, 2004. The consolidated financial statements include all
of the assets, liabilities and expenses of the Company and its wholly-owned
subsidiaries Ur-Energy USA Inc.; NFU Wyoming, LLC; Lost Creek ISR, LLC; The
Bootheel Project, LLC; NFUR Bootheel, LLC; Hauber Project LLC; NFUR Hauber, LLC;
ISL Resources Corporation; ISL Wyoming, Inc.; and CBM-Energy Inc. All
inter-company balances and transactions have been eliminated upon consolidation.
Ur-Energy Inc. and its wholly-owned subsidiaries are collectively referred to
herein as the “Company”.
Forward-Looking
Information
This
Management’s Discussion and Analysis contains "forward-looking statements"
within the meaning of applicable United States and Canadian securities laws.
Shareholders can identify these forward-looking statements by the use of words
such as "expect", "anticipate", "estimate", "believe", "may", "potential",
"intends", "plans" and other similar expressions or statements that an action,
event or result "may", "could" or "should" be taken, occur or be achieved, or
the negative thereof or other similar statements. These statements are only
predictions and involve known and unknown risks, uncertainties and other factors
which may cause the Company’s actual results, performance or achievements, or
industry results, to be materially different from any future results,
performance, or achievements expressed or implied by these forward-looking
statements. Such statements include, but are not limited to: (i) the Company’s
belief that it will have sufficient cash to fund its capital requirements;
(ii) receipt of
(and related timing of) a US Nuclear Regulatory Commission (“NRC”) Source
Material License, Wyoming Department of Environmental Quality (“WDEQ”) Permit
and License to Mine and other necessary permits related to Lost Creek; (iii)
Lost Creek and Lost Soldier will advance to production and the production
timeline at Lost Creek scheduled for late 2010; (iv) production rates,
timetables and methods at Lost Creek and Lost Soldier; (v) the Company’s
procurement plans and construction plans at Lost Creek; (vi) the
licensing
process
at Lost Soldier which efforts are expected to be streamlined; (vii) the timing,
the mine design planning and the preliminary assessment at Lost Soldier; (viii)
the completion and timing of various exploration programs and (ix) the
regulatory issues with the Thelon Basin Properties and related
exploration. These other factors include, among others, the
following: future estimates for production, production start-up and operations
(including any difficulties with start up), capital expenditures,
operating costs, mineral resources, recovery rates, grades and prices; business
strategies and measures to implement such strategies; competitive strengths;
estimated goals; expansion and growth of the business and operations; plans and
references to the Company’s future successes; the Company’s history of operating
losses and uncertainty of future profitability; the Company’s status as an
exploration and development stage company; the Company’s lack of mineral
reserves; the hazards associated with mining construction and production;
compliance with environmental laws and regulations; risks associated with
obtaining permits in Canada and the United States; risks associated with current
variable economic conditions; the possible impact of future financings;
uncertainty regarding the pricing and collection of accounts; risks associated
with dependence on sales in foreign countries; the possibility for adverse
results in potential litigation; fluctuations in foreign exchange rates;
uncertainties associated with changes in government policy and regulation;
uncertainties associated with the Canadian Revenue Agency’s audit of any of the
Company’s cross border transactions; adverse changes in general business
conditions in any of the countries in which the Company does business; changes
in the Company’s size and structure; the effectiveness of the Company’s
management and its strategic relationships; risks associated with the Company’s
ability to attract and retain key personnel; uncertainties regarding the
Company’s need for additional capital; uncertainty regarding the fluctuations of
the Company’s quarterly results; uncertainties relating to the Company’s status
as a non-U.S. corporation; uncertainties related to the volatility of the
Company’s shares price and trading volumes; foreign currency exchange risks;
ability to enforce civil liabilities under U.S. securities laws outside the
United States; ability to maintain the Company’s listing on the NYSE Amex (the
“NYSE Amex”) and Toronto Stock Exchange (the “TSX”); risks associated with the
Company’s possible status as a "passive foreign investment company" or a
"controlled foreign corporation" under the applicable provisions of the U.S.
Internal Revenue Code of 1986, as amended; risks associated with the Company’s
investments and other risks and uncertainties described under the heading “Risk
Factors” of the Company’s Annual Report on Form 20-F (Annual Information Form)
dated March 18, 2009 which is filed on SEDAR at www.sedar.com and
with the US Securities and Exchange Commission at www.sec.gov.
Nature
of Operations and Description of Business
The
Company is a development stage junior mining company engaged in the
identification, acquisition, evaluation, exploration and development of uranium
mineral properties in Canada and the United States. The Company has not yet
determined whether its properties contain mineral reserves. The recoverability
of amounts recorded for mineral properties is dependent upon the discovery of
economically recoverable resources, the ability of the Company to obtain the
necessary financing to complete the development of these properties and upon
attaining future profitable production from the properties or sufficient
proceeds from disposition of the properties. The Company is currently
in the process of permitting its Lost Creek property. As identified
in the June 2006 Technical Report on Lost Creek, National Instrument 43-101
compliant resources are 9.8 million pounds of U3O8 at 0.058
percent as an indicated resource and an additional 1.1 million pounds of U3O8 at 0.076
percent as an inferred resource.
The
Company is focused on uranium exploration in the following areas: (i) Wyoming,
USA where the Company has fourteen properties. Of those fourteen
properties, ten are in the Great Divide Basin, two of which (Lost Creek and Lost
Soldier) contain defined resources that the Company expects to advance to
production. The Company’s other Wyoming projects include two
properties in the Shirley Basin, one property in the Greater Black Hills, and
one property in the Powder River Basin; (ii) Arizona, USA where
the
Company has acquired a property in Yuma County; (iii) the Thelon Basin,
Northwest Territories, Canada, where it has three properties; and (iv) Baker
Lake Basin, Nunavut, Canada, where it has one property.
Selected
Information
The
following table contains selected financial information as at December 31, 2008
and December 31, 2007.
|
|
|
|
As
at
December
31,
2008
$
|
As
at
December
31,
2007
$
(As
restated)
|
|
Total
assets
|
|
|
101,533,965
|
110,931,322
|
|
Liabilities
|
|
|
3,256,634
|
2,092,296
|
|
Net
assets
|
|
|
98,277,331
|
108,839,026
|
|
Capital
stock and contributed surplus
|
|
|
157,118,019
|
149,826,129
|
|
Deficit
|
|
|
(58,840,688)
|
(40,987,103)
|
|
Shareholders’
equity
|
|
|
98,277,331
|
108,839,026
|
The
following table contains selected financial information for the years ended
December 31, 2008, 2007 and 2006 and cumulative information from inception of
the Company on March 22, 2004 to December 31, 2008.
|
|
Year
Ended December 31, 2008
$
|
Year
Ended December 31, 2007
$
(As
restated)
|
Year
Ended December 31, 2006
$
(As
restated)
|
Cumulative
from
March
22, 2004 to
December
31, 2008
$
(As
restated)
|
|
Revenue
|
Nil
|
Nil
|
Nil
|
Nil
|
|
Total expenses(1)
|
(25,967,711)
|
(22,959,356)
|
(12,395,814)
|
(70,879,783)
|
|
Interest
income
|
2,494,445
|
2,816,398
|
629,724
|
6,078,439
|
|
Foreign
exchange gain (loss)
|
5,656,319
|
(806,420)
|
(177,141)
|
5,568,239
|
|
Other
income (loss)
|
(36,638)
|
-
|
-
|
(36,638)
|
|
Loss
before income taxes
|
(17,853,585)
|
(20,949,378)
|
(11,943,231)
|
(59,269,743)
|
|
Recovery
(loss) of future income taxes
|
-
|
429,055
|
-
|
429,055
|
|
Net
loss for the period
|
(17,853,585)
|
(20,520,323)
|
(11,943,231)
|
(58,840,688)
|
|
(1)
Stock based compensation included in total expenses
|
(4,567,206)
|
(6,138,922)
|
(3,505,517)
|
(14,762,197)
|
|
Loss
per common share:
Basic
and diluted
|
(0.19)
|
(0.24)
|
(0.20)
|
|
|
Cash
dividends per common share
|
Nil
|
Nil
|
Nil
|
|
The
Company has not generated any revenue from its operating activities from
inception to date. The Company’s expenses include costs for general
and administrative expense, exploration and evaluation costs, development
expense and write-off of mineral property costs. The Company has
recorded significant stock-based compensation costs which were included in total
expenses. Acquisition costs of mineral properties are
capitalized. Exploration, evaluation and development expenditures,
including annual maintenance and lease fees, are charged to earnings as incurred
until the mineral property becomes commercially mineable.
No cash
dividends have been paid by the Company. The Company has no present
intention of paying cash dividends on its common shares as it anticipates that
all presently available funds will be invested to finance new and existing
exploration and development activities.
Overall
Performance and Results of Operations
From
inception to December 31, 2008, the Company has raised total cash proceeds from
the issuance of common shares and warrants and from the exercise of warrants,
compensation options and stock options of $141.2 million. As at
December 31, 2008, the Company held cash and cash equivalents, and short-term
investments of $65.0 million. The Company's cash resources are
invested with major banks in bankers' acceptances, guaranteed investment
certificates, certificates of deposit, and money market accounts. The Company
has made significant investments in mineral properties and exploration,
evaluation and development expenditures.
Mineral
Properties
During
the year ended December 31, 2008, the Company expended cash of $0.9 million
(2007 – $1.4 million) on mineral property costs. The most significant
component of these costs is staking and claim costs associated with the
acquisition of the mineral properties primarily located in the United
States. The Company’s mineral properties are located in Wyoming, USA,
Arizona, USA, Northwest Territories, Canada, and Nunavut, Canada.
Revised
Method of Acreage Calculation
Previously,
as related to its projects in the United States, the Company utilized rounded
estimates of mining claim mineral acreage based upon number of claims staked
multiplied by an estimated standard claim size of 20.66 acres per claim.
Recently, the Company upgraded and converted its land management system
processes to begin calculating mining claim mineral acreage primarily using
mapping software which permits more accurate approximations. By way of
example, mining claims normally are staked to overlap on adjacent property to
eliminate the possibility of gaps and can cover an area larger than actually
controlled; as well, claims deliberately may be staked smaller than standard
size to cover gaps.
Wyoming,
USA Properties
Lost Creek
Project
The Lost
Creek uranium deposit is located in the Great Divide Basin, Wyoming. The deposit
is approximately three miles (4.8 kilometers) long and the mineralization occurs
in four main sandstone horizons between 315 feet (96 meters) and 700 feet (213
meters) in depth.
As
identified in the June 2006 Technical Report on Lost Creek, National Instrument
43-101 (“NI 43-101”) compliant resources are 9.8 million pounds of U3O8 at
0.058 percent as an indicated resource and an additional 1.1 million pounds
of U3O8 at
0.076 percent as an inferred resource. During 2006, 17 cased
monitoring and pump test wells were completed on the property, and initial
testing was completed.
The 2007
drilling program included 58 additional monitor and pump test wells,
two water wells and a total of 195 delineation drill holes. This program
enabled the Company to obtain additional baseline and hydrogeologic data within
the first mine unit area for engineering assessments; for the State of Wyoming
Department of Environmental Quality ("WDEQ") Permit to Mine application; for the
US Nuclear Regulatory Commission ("NRC") Source Material License application;
and, for the WDEQ Mine Unit #1 Permit application. In addition, six condemnation
holes were drilled to make certain the potential target plant location was not
over any part of the ore body.
In
October 2007, the Company submitted its Application to the NRC for a Source
Material License for the Lost Creek project. This license is the first stage of
obtaining all necessary licenses and permits to enable the Company to recover
uranium via in situ recovery method at the Lost Creek project. The collection
and compilation of the extensive environmental background data for the
application was a two-year process. In February 2008, the Company requested that
the NRC application for its Lost Creek project be withdrawn to enable the
Company to include upgrades to its application with respect to the project's
operational plan and other advances in the health physics information and
analyses. In March 2008, the Company re-submitted the Source Material
License application to the NRC. In June 2008, the NRC notified the
Company it deemed
the Lost Creek application complete. The NRC thereafter commenced its detailed
technical and environmental review of the Company’s
application.
In 2007,
the Company also submitted the Lost Creek Mine Permit Application to the WDEQ.
Individual mine unit applications for each well field will be submitted to cover
each mine unit or well field that will be produced on the Lost Creek
project. In May 2008, the Company received notice from the
WDEQ that the agency found the application to be complete and authorized the
Company to proceed with formal Public Notice of the application, which was
subsequently completed on a timely basis by the Company.
Throughout
the latter part of 2008 and, to date, in 2009, the Company has been responding
to requests from both agencies for additional information, which is part of the
routine process toward completion of the technical and environmental reviews of
the applications.
In
February 2008, an in-house economic analysis on the Lost Creek project was
completed by the Company’s engineering team. An independent technical report
under NI 43-101 was subsequently prepared by Lyntek Inc. The purpose
of the report was to provide an independent analysis and preliminary assessment
of the potential economic viability of the mineral resource of the Lost Creek
project. The resulting base case in the preliminary assessment
prepared by Lyntek returned a pre-tax internal rate of return of 43.6% at a
price of US$80 per pound U3O8, and
demonstrated that the project would be economic at prices above US$40 per pound
U3O8.
In
September 2008, the Company announced an update to the Lost Creek permitting and
production timeline based on further licensing guidance from the
NRC. Based upon an NRC release of updated guidance on its expected
publication of a final Generic Environmental Impact Statement for In-Situ Leach
Uranium Milling Facilities ("GEIS") in a July 28, 2008 Federal Register notice
(Vol.73, No. 145), the NRC revised its expected publication date from January
2009 to June 2009.
In early
September 2008, the Company conducted meetings with senior officials of the NRC
to confirm how the revised GEIS completion date would affect the timing of the
issuance of licenses to presently pending applicants, including Lost
Creek. As a result of the meetings, Ur-Energy revised its expectation
for the issuance of the Lost Creek's NRC license from second quarter 2009 to
fourth quarter 2009. First production from the Lost Creek project is now
anticipated to occur in the second half of 2010.
The
exploration and development program for 2008 at Lost Creek was designed to
further delineate known resources, explore the permit area for additional
resources outside of the known areas, and to install the monitoring wells
required for the first mine unit. The program included the following
activities:
|
|
o
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300
delineation holes within the proposed mine unit area to provide detailed
definition of the extent of minable uranium
resources.
|
|
|
o
|
99
exploration holes were drilled to test for potential extensions of mineral
trends. Drill hole depths ranged from 600 to 1,000 feet (183 to
305 meters).
|
|
|
o
|
48
cased monitor and pump test wells were installed within and surrounding
the first proposed mine unit. These wells will be utilized for
production monitoring.
|
|
|
o
|
Ten
regional baseline wells were also installed at the request of the
WDEQ. The average well depth is approximately 450 feet (137
meters).
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|
o
|
Two
water supply wells were drilled, cased and
completed.
|
|
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·
|
The
program employed seven contract drill rigs throughout much of the
six-month drilling program. Geophysical logging units were also
contracted to provide measurements of down-hole equivalent uranium
mineralization. These were complemented by Ur-Energy’s Prompt
Fission Neutron “PFN” logging truck, capable of providing down-hole
chemical uranium measurements.
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·
|
Core
samples from several holes were obtained. Chemical uranium
analyses of the core samples have been conducted, and will be used as
referee and quality control measurements to be compared to the down-hole
logging measurements of mineralization. Leach testing will also
be conducted on selected core samples. All wells were
cased in accordance with WDEQ guidelines and regulations; plugging and
permanent abandonment of all uranium exploration and delineation boreholes
was completed.
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·
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Surveys
of soils and geotechnical borings were conducted to assist in the
evaluation of plant and road facilities
design.
|
Following
the 2008 drilling program, Ur-Energy personnel oversaw the drilling of a deep
test well at Lost Creek. The well will be utilized to test the stratigraphy and
groundwater quality for purposes of permitting future disposal well(s) to
support site operations. The well reached a total depth of 9,894 feet
(3,016 meters), on December 17, 2008 and was then cased. Additional well
data will be obtained in 2009 to support the Company’s permitting activities.
Also during fourth quarter of 2008, the Company completed the pump testing of
the monitor wells associated with the first mine unit.
During
2008, the Company purchased and mobilized operational equipment,
including: backhoes, a water truck, a forklift, light and heavy
trucks, trailers, offices, a hose reel, generators and cementers. In
2009, the Company’s engineering staff, assisted by TREC Engineering, has
completed the detailed
designs
and specifications for all components of the Lost Creek ISR Plant and Mine Unit
# 1. Requests for bids are being prepared to be provided to vendors
and contractors. Procurement will be ongoing throughout
2009. Construction at the Lost Creek site will begin upon receipt of
the necessary permits.
A royalty
on future production of 1.67% is in place with respect to 20 claims comprising a
small portion of the Lost Creek project.
Lost Soldier
Project
The Lost
Soldier project is located approximately 14 miles (22.5 kilometers) to the
northeast of the Lost Creek project. The property has over 3,700 historical
drill holes defining 14 mineralized sandstone units. As identified in the July
2006 Technical Report on Lost Soldier, NI 43-101 compliant resources are 5.0
million pounds of U3O8 at 0.064%
as a measured resource, 7.2 million pounds of U3O8 at 0.065%
as an indicated resource and 1.8 million pounds of U3O8 at 0.055%
as an inferred resource. The Company maintains 143 lode mining claims
at Lost Soldier, totaling approximately 2,710 mineral acres. Of these
143 mining claims at Lost Soldier, 60 new claims were staked in 2008 for mine
engineering design purposes. A royalty on future production of 1%,
which arises from a data purchase, is in place with respect to certain claims
within the project.
All
environmental baseline studies were completed in 2007. In January
2008, the Lost Soldier deposit was turned over to the Company’s engineering
staff for detailed engineering evaluation and study, which has been
ongoing. Subsequently, in late 2008, members of the geology staff
have commenced in-depth studies which focus on detailed mapping of the
roll-front geology. These studies will then be followed by detailed
mine design planning, and a preliminary assessment, all of which are expected to
proceed in 2009.
In March
2008, the Company had requested a separate docket number and technical
assignment control number for the Lost Soldier project from the
NRC. The Company has since determined it will submit the applications
to the NRC and WDEQ as amendments to the Lost Creek licenses, after they are
issued by those agencies. It is anticipated that the Lost Soldier
licensing effort will be streamlined and more efficient as a satellite facility
to the Lost Creek project.
Other Wyoming
Properties
In 2008,
exploration drilling of 11,370 feet (3,468 meters) was completed at the EN
project. In January 2009, the Company completed an agreement reducing an
existing royalty on claims and an area of interest arising from transactions
dating back to 2006. With regard to the EN project, and three other areas,
the Company was able to eliminate the area of interest and to reduce the royalty
from two percent (2%) to one percent (1%) on certain specified mining
claims. In a related transaction, the Company purchased 66 new claims
which have become a part of the EN project, bringing that project to a total of
533 mining claims, together with one state mining lease.
Also in
2008, additional exploration data was obtained by completing over 746 miles
(1,200 kilometers) of airborne geophysical surveys in
Wyoming. The Company put other drilling programs, including for the
LC North and North Hadsell projects, on hold in order to advance the development
of the Lost Creek project. Also as a result of budgetary controls, the Company
dropped exploration lands in South Dakota containing over 72,000 acres prior to
additional costs of retention being incurred. As of the end of 2008,
the Company maintains approximately 65,000 mineral acres in
Wyoming. During 2008 and into 2009, an in-house team of geologists
has continued to evaluate the extensive well log and exploration database owned
by the Company for generating new exploration targets.
In 2007,
the Company completed the acquisition of a data package from Power Resources
Inc. ("PRI") pertinent to exploration and development on its Bootheel and Buck
Point properties, in the Shirley Basin, Wyoming, for a total purchase price of
US$180,000, which was paid in two equal installments in 2006 and 2007. The data
includes drill hole logs for more than 1,000 drill holes, historical resource
reports, maps, drill summaries, individual drill hole summaries, handwritten
notes, and digital printouts from such previous operators as Cherokee, Kerr
McGee, Uradco (PP&L), and Mobil as well as historical feasibility reports
from Dames & Moore and Nuclear Assurance.
In 2007,
the Company entered into an agreement with Target Exploration & Mining Corp.
and its subsidiary ("Target"). Under the terms of the agreement, the Company
contributed its Bootheel and Buck Point properties to The Bootheel Project, LLC
(the “Bootheel Project”). The properties cover an area of known
uranium occurrences within the Shirley Basin. Target is earning into a 75%
interest in the Bootheel Project by spending US$3.0 million in exploration
costs, and issuing 125,000 shares of its common stock to the Company, all within
a four-year earn-in period. With the completion earlier
in 2008 of agreements for additional rights and leased lands, the total project
covers defined areas of approximately 8,524 gross, and 7,895 net, mineral acres.
(The statement of net mineral acres with regard to the Bootheel property arises
as a part of the 2008 agreements to which the lessor has a 75% mineral
interest.)
Target
timely issued its second installment of stock (25,000 shares) and confirmed its
completion of the first year’s required exploration expenditures. In
2008, Target also completed a 50,000 foot (15,250 meter) drilling program on the
Bootheel property of the Project. The purpose of the program was to bring the
historic resources in NI 43-101 compliance. In January 2009, Target
announced that it had completed the acquisition of the final historic data
package in behalf of the Bootheel Project. The data package,
purchased from Cameco Corp., comprises data from approximately 290,000 feet of
drilling carried out by Cameco, Kerr McGee and Uradco. The data acquired
includes not only geological logs but also gamma logs containing equivalent
uranium (eU3O8), values.
This industry standard method of using eU3O8 indicates
the amount of uranium present as determined by measuring gamma radiation using a
down-hole probe.
The
Company has made the data it acquired earlier from PRI covering the Bootheel and
Buck Point properties (see discussion above), and certain other data, available
to the Bootheel Project. PRI retained a royalty of 1% on future
production of uranium and associated minerals from certain lands in the Bootheel
Project.
In
February 2009, Target issued 50,000 additional shares of its stock to the
Company to complete the stock-based earn-in obligations (third and fourth
installments) of the operating agreement of the Bootheel Project.
In 2007,
the Company entered into agreements with Trigon Uranium Corporation and its
subsidiary ("Trigon"). Under the terms of the agreements, the Company
contributed its Hauber property to Hauber Project LLC (the “Hauber
Project”). The Hauber Project is located in Crook County, Wyoming and
consists of 205 unpatented lode mining claims and one state uranium lease
totaling approximately 4,570 mineral acres.
Effective
August 1, 2008, Trigon tendered its resignation as a Member and the Manager of
the Hauber Project. Transition of management of the Hauber Project
back to the Company has been completed. Before Trigon's decision not
to proceed, it had contracted, as Manager of Hauber Project, for several outside
geologic and hydrologic analytical projects, which were completed and submitted
during the first half of 2008. The consultants employed abundant
historic data to define the geologic setting and assess
the
potential of the Hauber Project properties for the recovery of uranium through
ISR mining methods. Further in-house analysis of these reports is
underway.
Canadian
Properties and Interests
Screech Lake Property,
Thelon Basin
In 2006,
an environmental screening study was completed on the Screech Lake project and
an application for a land use permit to conduct drill testing of the Screech
Lake anomalies was referred to the Mackenzie Valley Environmental Impact Review
Board (“Review Board”) for environmental assessment. In 2007, the environmental
assessment was completed and a report and recommendation from the Review Board
was issued. The Review Board recommended to the Minister of Indian and Northern
Affairs Canada (the “Minister”) that the Company’s application to conduct an
exploratory drilling program at the Screech Lake property be rejected due to
local native community concerns.
In
October 2007, the Company received notification that the Minister had adopted
the recommendation of the Review Board. As part of the decision, the Minister
did confirm that the decision does not affect the legal standing of the
Company’s Screech Lake mineral claims. Discussions with the Minister and other
interested parties led the Company to conclude that the rejection was
influenced, in part, by land claims issues between First Nations groups and the
Federal government, and to a lesser extent, environmental concerns related to
caribou migration routes and timing of a drill program. In the
Company’s application for a land use permit, extensive mitigation measures were
proposed to ensure that the drilling program would have minimal short-term
environmental impact and no long-term effect.
Throughout
2008, the Company continued its ongoing discussions with First Nations groups
and Aboriginal-owned business corporations to secure an exploration agreement
which would allow the Company to proceed with re-filing of a drilling proposal
and application for land use permit.
Bugs Property, Baker Lake
Basin
In
September 2006, the Company entered into an option agreement to acquire the Bugs
property in Nunavut, Canada. The Company has earned a 100% interest
in the property by issuing a total of 85,000 common shares to the
vendor. The vendor retains a 2% net smelter royalty, of which 1% is
subject to a buyout for $1.0 million. The Bugs property initially consisted of
11 contiguous mineral claims in the Kivalliq region of the Baker Lake
Basin. In 2008 the Company staked an additional eight mineral claims,
which together total approximately 45,000 acres (approximately 18,000
hectares).
In 2006,
a fixed wing aeromagnetic and radiometric survey was conducted on the entire
property. The data from this survey resulted in the selection of seven targets
based upon structural offset and dilation features in combination with magnetite
depletion. In 2007, one of the seven targets was examined; the remaining targets
were examined and prioritized during the 2008 summer program by radon sampling
techniques, prospecting and rock sampling. This work led to interpreted areas of
hydrothermal alteration, elevated radioactivity and high radon
flux.
Six drill
holes were completed from late August to mid September of 2008, for a total of
2,905 feet (885 meters). The program was terminated early
due to problems with drilling equipment. Results of the program are
being evaluated by the Company. The Company incurred total exploration and
acquisition costs of approximately $2.0 million during the 2008
program. As a part of this program, the Company utilized funds from
the flow-through financing it raised in March 2008. See Financing Transactions,
below.
Other Canadian
Interests
In 2006,
the Company completed a definitive agreement with Triex Minerals Corporation
(“Triex”) with respect to the Mountain Lake and Dismal Lake West properties
(together, comprising 58 claims). Pursuant to the option agreement,
Triex obtained a 100% interest in the properties in September
2007. The Company retains a 5% net smelter return royalty interest in
the properties with Triex having the right to purchase one-half of the royalty
for $5,000,000.
2008
Expenses Compared to 2007
Total
expenses for the year ended December 31, 2008 were $26.0 million as compared to
$23.0 million in 2007. Total expenses include general and
administrative expense, exploration and evaluation expense, development expense
and write-off of mineral property costs.
Overall,
2008 total expenses increased $3.0 million as compared to 2007. The
increase in total expenses was primarily due to increased expenditures on the
Company’s exploration and development projects, the continued expansion of the
Littleton, Colorado and Casper, Wyoming offices, and increases in non-cash
amortization of capital assets and write-off expenses. The increase
in total expenses was partially offset by a decrease in non-cash stock based
compensation expense.
Exploration,
evaluation and development expenditures increased $3.1 million in 2008,
primarily due to the transition of the Company’s Lost Creek property from the
evaluation stage to the development stage. During 2008, the Company
spent approximately $1.9 million in evaluation activities and $8.8 million in
development activities related to the Lost Creek property, which were expensed
in accordance with the Company’s revised accounting
policies. Additionally, the Company incurred significant expenditures
on other exploration and evaluation properties including the Bugs property in
Canada and the Lost Soldier property in the United States.
General
and administrative expense relates primarily to the Company’s administration,
finance, investor relations, land and legal functions in Littleton,
Colorado. During 2008, the Company continued to expand the Casper,
Wyoming office. The Company strengthened key staffing areas adding
eight positions primarily aimed at enhancing operating expertise at the Casper
office. Accordingly, the Denver and Casper offices were also expanded
to accommodate and support the staffing additions.
During
the year, the Company recorded significant non-cash stock based compensation
expenses related to stock options. In September 2008, the Company
gave the holders of options with an exercise price of $4.75 or higher the
opportunity to voluntarily return all or a portion of these options to the
Company by September 30, 2008 without any promise or guarantee that the option
holders will receive any further options. Options for 2,490,000
shares with a weighted exercise price of $4.82 were returned to the
Company. Previously unrecognized stock based compensation cost of
$2.2 million was recognized at the cancellation date. Including the
above, for 2008, stock based compensation expenses of $4.6 million (2007 –
$6.1 million) were included in total expenses. These non-cash
expenses represent approximately 18% of total expenses (2007 –
27%).
During
the third quarter of 2008, the Company relinquished leases associated with the
Harding and Fall River projects in South Dakota and wrote-off the approximately
$0.3 million in costs related to these projects.
Other
income and expenses
The
Company's cash resources are invested with major banks in bankers' acceptances,
guaranteed investment certificates, certificates of deposit, and money market
accounts. During the year ended December 31, 2008, the Company earned
interest income on these investments of $2.5 million, as compared to $2.8
million in 2007. After the May 2007 bought deal financing and the
March 2008 private placement, the Company’s average cash resources increased
significantly. However, the Company does not generate any revenue
from operating activities and its average cash resources, and the resulting
interest income, have declined since the two financings were
completed.
During
the year ended December 31, 2008, the Company recorded a net foreign exchange
gain of $5.7 million as compared to a $0.8 million loss during the same
period in 2007. This 2008 net foreign exchange gain arose primarily
due to cash balances held in U.S. dollar accounts as the U.S. dollar
strengthened relative to the Canadian dollar during the period, while in 2007
the U.S. dollar declined in value relative to the Canadian dollar.
Income
Taxes
In 2008,
the Company recorded operating losses in both Canada and the United
States. Management has concluded that it is not yet more likely than
not that these losses, and prior years’ loss carryforwards and other tax assets
will be realized, and therefore the Company has recorded a full valuation
allowance against these amounts.
In 2007,
the Company also recorded losses in both jurisdictions against which full
valuation allowances were applied, except in respect of the Company’s ISL
subsidiary. The Company acquired ISL in 2004 and recorded a future
tax liability upon the acquisition related to the difference between
management’s estimate of the tax basis and the fair value assigned to the assets
acquired. In 2007, management filed tax returns for ISL for the
pre-acquisition period and established additional tax basis for the ISL assets
and consequently recorded a reduction in the future tax liability related to
these assets.
Loss
Per Common Share
Both
basic and diluted loss per common share for the year ended December 31, 2008
were $0.19 (2007 – $0.24). The diluted loss per common share is equal
to the basic loss per common share due to the anti-dilutive effect of all
convertible securities outstanding given that net losses were
experienced.
2007
Expenses Compared to 2006
Total
expenses for the year ended December 31, 2007 were $23.0 million as compared to
$12.4 million in 2006. Total expenses include general and
administrative expense, exploration and evaluation expense, development expense
and write-off of mineral property costs.
General
and administrative expenses were $1.8 million higher than in
2006. The majority of the increase in general and administrative
expense was due to stock option related charges as discussed
below. The balance of increased general and administrative costs
related primarily to expansion of the Littleton, Colorado office and related
staff costs for finance, legal and support personnel.
During
the year ended December 31, 2007, the Company recorded significant non-cash
stock based compensation charges related to stock options. In total, expenses
recorded related to stock options were $6.1 million as compared to $3.5 million
in 2006. These non-cash charges to expense represent approximately 27% of total
expenses (2006 – 28%).
Exploration
and evaluation expense increased significantly during 2007 as the Company
rapidly advanced its Lost Creek and Lost Soldier properties in
Wyoming. During 2007, the Company spent approximately US$8.5
million for exploration activities on these two properties. The
Company also spent significant amounts on other exploration properties including
the Screech Lake in Canada.
During
the fourth quarter of 2007, Company management decided not to proceed with
funding of any additional exploration of the Titan R-Seven and Rook I
properties. Accordingly, the Company wrote off approximately $34,000
in related mineral property costs.
Other
income and expenses
The
Company's cash resources are invested with major banks in bankers' acceptances,
guaranteed investment certificates, certificates of deposit, and money market
accounts. During the year ended December 31, 2007, the Company earned interest
income on these investments of $2.8 million (2006 - $0.6
million). Interest income was significantly higher in the third and
fourth quarters of 2007 as the proceeds of the bought deal financing were
invested from early May through to the end of the year.
During
the year ended December 31, 2007, the Company recorded a net foreign exchange
loss of $0.8 million (2006 - $0.2 million). This net foreign
exchange loss arose primarily due to cash balances held in U.S. currency as the
Canadian dollar strengthened relative to the U.S. dollar during the period from
September to November 2007. During the first and second quarters of
2007, the Company experienced gains on the U.S. dollar denominated New Frontiers
obligation. The obligation was fully repaid during the second quarter
of 2007.
Loss
Per Common Share
Both
basic and diluted loss per common share for the year ended December 31, 2007
were $0.24 (2006 – $0.20). For the years ended December 31, 2007 and
2006, diluted loss per common share is equal to the basic loss per common share
due to the anti-dilutive effect of all convertible securities outstanding given
that net losses were experienced.
Liquidity
and Capital Resources
As at
December 31, 2008, the Company had cash and cash equivalents, and short-term
investments of $65.0 million, a decrease of $11.3 million from the December 31,
2007 balance of $76.3 million. The Company's cash resources are
invested with major banks in Canada and United States in guaranteed investment
certificates, certificates of deposit, bankers' acceptances, and money market
accounts. During the year ended December 31, 2008, the Company used
$10.5 million to fund operating activities, spent $3.5 million on investing
activities, and generated $2.7 million from financing activities.
During
the year ended December 31, 2008, the Company invested cash of $3.5 million in
mineral properties, bonding deposits, capital assets and design work on the Lost
Creek plant. The majority of these expenditures went toward bonding
deposits and the purchase of capital assets. The capital asset
purchases were primarily for field vehicles and field equipment purchased to
facilitate the exploration and development work programs in
Wyoming.
On March
25, 2008, the Company completed a non-brokered private placement of
1,000,000 flow-through commons shares at $2.75 per share raising gross
proceeds of $2.8 million. Total direct share issue costs were $0.1
million. During the year ended December 31, 2008, the Company
realized cash
proceeds
of $0.1 million from the exercise of previously issued stock
options. In September 2008, the Company gave the holders of options
with an exercise price of $4.75 or higher the opportunity to voluntarily return
all or a portion of these options to the Company by September 30, 2008 without
any promise or guarantee that the option holders will receive any further
options. Options for 2,490,000 shares with a weighted exercise price of
$4.82 were returned to the Company. Therefore, as at December 31,
2008, the Company had outstanding a total of 6,228,700 stock options with a
weighted-average exercise price of $1.95 per option.
The
Company has financed its operations from its inception primarily through the
issuance of equity securities and has no sources of cash flow from
operations. The Company will not generate any cash flow from
operations until it is successful in commencing production from its
properties.
The
Company has established a corporate credit card facility with a U.S. bank. This
facility has an aggregate borrowing limit of US$250,000 and is used for
corporate travel and incidental expenses. The Company has provided a
letter of credit and a guaranteed investment certificate in the amount of
$287,500 as collateral for this facility.
Financing
Transactions
The
Company completed a non-brokered private placement of 1,000,000 flow-through
common shares at $2.75 per share on March 25, 2008 and raised gross proceeds of
$2.8 million. Total direct share issue costs were $0.1
million.
On
November 7, 2008 the Company’s board of directors approved the adoption of a
shareholder rights plan (the “Rights Plan”) designed to encourage the fair and
equal treatment of shareholders in connection with any take-over bid for the
Company's outstanding securities. The Rights Plan is intended to
provide the Company’s board of directors with adequate time to assess a
take-over bid, to consider alternatives to a take-over bid as a means of
maximizing shareholder value, to allow competing bids to emerge, and to provide
the Company’s shareholders with adequate time to properly assess a take-over bid
without undue pressure.
Although
the Rights Plan took effect immediately, in accordance with the TSX
requirements, the Company will seek approval and ratification by its
shareholders at the next annual and special meeting of shareholders on April 28,
2009. If the Rights Plan is not ratified, the Rights Plan and all of
the Rights outstanding will terminate.
Outstanding
Share Data
Information
with respect to outstanding common shares, warrants, compensation options and
stock options as at December 31, 2008 and December 31, 2007 is as
follows:
|
|
December
31,
2008
|
December
31, 2007
|
|
Common
shares
|
93,243,607
|
92,171,607
|
|
Warrants
|
-
|
-
|
|
Compensation
options
|
-
|
-
|
|
Stock
options
|
6,228,700
|
8,010,700
|
|
Fully
diluted shares outstanding
|
99,472,307
|
100,182,307
|
Off-Balance
Sheet Arrangements
The
Company has not entered into any material off-balance sheet arrangements such as
guarantee contracts, contingent interests in assets transferred to
unconsolidated entities, derivative instrument obligations, or with respect to
any obligations under a variable interest entity arrangement.
Financial
Instruments and Other Instruments
The
Company’s financial instruments consist of cash and cash equivalents, short-term
investments, amounts receivable, bonding and other deposits and accounts
payable. The Company is exposed to risks related to changes in
foreign currency exchange rates, interest rates and management of cash and cash
equivalents and short term investments.
Credit
risk
Financial
instruments that potentially subject the Company to concentrations of credit
risk consist of cash and cash equivalents, short term investments and bonding
deposits. The Company’s cash equivalents and short term investments
include Canadian dollar and US dollar denominated guaranteed investment
certificates and certificates of deposits. They bear interest at
annual rates ranging from 0.75% to 3.25% and mature at various dates up to April
30, 2009. These instruments are maintained in financial institutions
in Canada and the United States. Of the amount held on deposit,
approximately $0.4 million is covered by either the Canada Deposit Insurance
Corporation or the Federal Deposit Insurance Corporation, leaving approximately
$64.6 million at risk should the financial institutions with which these amounts
are invested cease trading. As at December 31, 2008, the Company does
not consider any of its financial assets to be impaired.
Liquidity
risk
Liquidity
risk is the risk that the Company will not be able to meet its financial
obligations as they fall due.
The
Company manages liquidity risk through regular cash flow forecasting of cash
requirements to fund exploration and development projects and operating
costs.
As at
December 31, 2008 the Company’s liabilities consisted of trade accounts payable
of $2,265,058, all of which are due within normal trade terms of generally 30 to
60 days.
Market
risk
Market
risk is the risk to the Company of adverse financial impact due to changes in
the fair value or future cash flows of financial instruments as a result of
fluctuations in interest rates and foreign currency exchange
rates. Market risk arises as a result of the Company incurring a
significant portion of its expenditures and a significant portion of its cash
equivalents and short term investments in United States dollars, and holding
cash equivalents and short term investments which earn interest.
Interest
rate risk
Financial
instruments that expose the Company to interest rate risk are its cash
equivalents and short term investments. The Company’s objectives for managing
its cash and cash equivalents are to ensure sufficient funds are maintained on
hand at all times to meet day to day requirements and to place any amounts which
are considered in excess of day to day requirements on short-term deposit with
the Company's banks so that they earn interest. When placing amounts of cash and
cash equivalents on short-
term
deposit, the Company only uses high quality commercial banks and ensures that
access to the amounts placed can generally be obtained on short
notice.
Currency
risk
The
Company incurs expenses and expenditures in Canada and the United States and is
exposed to risk from changes in foreign currency rates. In addition, the Company
holds financial assets and liabilities in Canadian and US dollars. The Company
does not utilize any financial instruments or cash management policies to
mitigate the risks arising from changes in foreign currency rates.
At
December 31, 2008 the Company had cash and cash equivalents, short term
investments and bonding deposits of approximately US$26.5 million (US$18.4
million as at December 31, 2007) and had accounts payable of US$1.7 million
(US$1.2 million as at December 31, 2007) which were denominated in US
dollars.
Sensitivity
analysis
The
Company has completed a sensitivity analysis to estimate the impact that a
change in foreign exchange rates would have on the net loss of the Company,
based on the Company’s US$ denominated assets and liabilities at year end. This
sensitivity analysis assumes that changes in market interest rates do not cause
a change in foreign exchange rates. This sensitivity analysis shows
that a change of +/- 10% in US$ foreign exchange rate would have a +/- $3.0
million impact on net loss for the year ended December 31, 2008. This
impact is primarily as a result of the Company having year end cash and
investment balances denominated in US dollars and US dollar denominated trade
accounts payables. The financial position of the Company may vary at
the time that a change in exchange rates occurs causing the impact on the
Company’s results to differ from that shown above.
The
Company has also completed a sensitivity analysis to estimate the impact that a
change in interest rates would have on the net loss of the Company. This
sensitivity analysis assumes that changes in market foreign exchange rates do
not cause a change in interest rates. This sensitivity analysis shows
that a change of +/- 100 basis points in interest rate would have a +/- $0.6
million impact on net loss for the year ended December 31, 2008. This
impact is primarily as a result of the Company having cash and short-term
investments invested in interest bearing accounts. The financial
position of the Company may vary at the time that a change in interest rates
occurs causing the impact on the Company’s results to differ from that shown
above.
Transactions
with Related Parties
During
the years ended December 31, 2008 and 2007, the Company did not participate in
any material transactions with any related parties.
Proposed
Transactions and Listing Application Approval
As is
typical of the mineral exploration and development industry, the Company is
continually reviewing potential merger, acquisition, investment and venture
transactions and opportunities that could enhance shareholder
value. Timely disclosure of such transactions is made as soon as
reportable events arise.
In
January 2008, the Company filed documentation with the United States Securities
and Exchange Commission on Form 40-F to register the common shares of the
Company and filed an application to list the common shares with the American
Stock Exchange, LLC (“AMEX”). The application was subject to review
by the AMEX, and on July 18, 2008, the AMEX approved for listing the common
shares of the
Company. Trading
of the common shares of the Company on the AMEX (now the NYSE Amex) commenced on
July 24, 2008 under the symbol “URG”.
Critical
Accounting Policies and Estimates
Mineral
Properties
Acquisition
costs of mineral properties are capitalized. When production is attained, these
costs will be amortized on the unit-of-production method based upon the
estimated recoverable resource of the mineral property.
The
Company assesses the possibility of impairment in the net carrying value of its
mineral properties when events or circumstances indicate that the carrying
amounts of the asset or asset group may not be
recoverable. Given the current disruption and uncertainty in
the global economy, and the decrease in the Company’s share price over the last
year, management reviewed all of its significant mineral properties for
potential impairment.
For the
Company’s Lost Creek and Lost Soldier properties, management calculated the
estimated undiscounted future net cash flows relating to these properties as a
single asset group as the Company expects to mine the Lost Soldier property as a
satellite facility, licensed through an amendment to the Lost Creek permits, and
using the Lost Creek plant. Management calculated the future net cash
flows using estimated future prices, indicated resources, and estimated
operating, capital and reclamation costs.
The
Company’s estimates of indicated resources depend upon geological interpretation
and statistical inferences drawn from drilling and sampling
analysis. The operating, capital and reclamation costs are based upon
similar production plants and current capital budgets for the project. The
uranium prices used are based on current long term contract prices and external
consensus prices which for uranium vary between US$50 and US$70 per
pound. By their very nature there can be no assurance that these
estimates will actually be reflected in future construction or operation at the
projects.
Management’s
estimate of the undiscounted cash flows related to these mineral properties
exceed their carrying value, therefore management concluded that the assets
passed step 1 of the asset impairment test prescribed under generally accepted
accounting principles, and therefore no write-down of these assets was recorded.
Management’s estimates of mineral prices, mineral resources, foreign exchange,
production levels and operating capital and reclamation costs are subject to
risk and uncertainties that may affect the determination of the recoverability
of the long-lived asset. It is possible that material changes could occur that
may adversely affect management’s estimates.
For the
Company’s other properties, reliable cash flow forecasts cannot be made at this
time. Management therefore tested these for impairment by comparing
their carrying values to their estimated fair value based on non-NI 43-101
compliant resource estimates of indicated resources and a value of US$2 per
pound in the ground. Management also considered the results of
current exploration activities on the properties and future exploration plans
and expenditures by both the Company and, in the case of the Bootheel Project,
Target, to assess whether these were inconsistent with other indicators of fair
value. Based on the above, management concluded that the fair value
of these properties exceeded the carrying amount and no impairment charges were
recorded.
Stock Based
Compensation
The
Company is required to record all equity instruments including warrants,
compensation options and stock options at fair value in the financial
statements. Management utilizes the Black-Scholes model to
calculate
the fair value of these equity instruments at the time they are
issued. Use of the Black-Scholes model requires management to make
estimates regarding the expected volatility of the Company’s stock over the
future life of the equity instrument, the estimate of the expected life of the
equity instrument, the expected volatility of the Company’s common shares, and
the number of options that are expected to be
forfeited. Determination of these estimates requires significant
judgment and requires management to formulate estimates of future events based
on a limited history of actual results and by comparison to other companies in
the uranium exploration and development segment.
Changes
in Accounting Policies Including Initial Adoption
Exploration and Development
Expenditures
In
December 2008, the Company changed its policy for accounting for exploration and
development expenditures. In prior years, the Company capitalized all
direct exploration and development expenditures. Under its new policy,
exploration, evaluation and development expenditures, including annual
exploration license and maintenance fees, are charged to earnings as incurred
until the mineral property becomes commercially mineable.
Management
considers that a mineral property will become commercially mineable when it can
be legally mined, as indicated by the receipt of key
permits. Development expenditures incurred subsequent to the receipt
of key permits will be capitalized and amortized on the unit-of-production
method based upon the estimated recoverable resource of the mineral
property. Management believes that this treatment provides a more
relevant and reliable depiction of the Company’s asset base and more
appropriately aligns the Company’s policies with those of comparable companies
in the mining industry at a similar stage.
The
Company has accounted for this change in accounting policy on a retroactive
basis. Balance sheet amounts as at December 31, 2007 were restated as
follows: deferred exploration expenditures were reduced by $26.4 million, future
income taxes liabilities were reduced by $0.7 million, share capital increased
by $2.2 million and the accumulated deficit increased by
$27.9 million. The comparative operating results for the year
ended December 31, 2007 and 2006 were also restated as
follows: expenses increased by $11.4 million and
$6.4 million, recovery of future income taxes decreased by
$2.1 million and $0.5 million, net loss increased by
$13.5 million and $6.9 million, and loss per common share increased by
$0.16 and $0.11, respectively. The cumulative operating results for
the period from March 22, 2004 to December 31, 2007 were restated as
follows: expenses increased by $24.9 million, recovery of future
income taxes decreased by $3.0 million, and net loss increased by
$27.9 million.
The
Company will continue to capitalize the acquisition costs of mineral properties
and capital assets.
New Accounting
Standards
On
January 1, 2008, the Company adopted the following Canadian Institute of
Chartered Accountants (“CICA”) Handbook Sections:
|
|
·
|
Section
3862, Financial Instruments – Disclosures, and Section 3863, Financial
Instruments – Presentation. These new disclosure standards
increase the Company’s disclosure regarding the nature and risk associated
with financial instruments and how those risks are managed. The
new presentation standard carries forward the former presentation
requirements.
|
|
|
·
|
Section
1535, Capital Disclosures. This new standard requires the
Company to disclose its objectives, policies and processes for managing
its capital structure.
|
|
|
·
|
Section
1400, General Standards on Financial Statement
Presentation. This standard requires management to assess at
each balance sheet date and, if necessary, disclose any
uncertainty
|
|
|
surrounding
the ability of the Company to continue as a going concern. The
adoption of this standard had no impact on the Company’s disclosures in
these interim financial statements.
|
Disclosure
Controls and Procedures
The Chief
Executive Officer and Chief Financial Officer of the Company evaluated the
effectiveness of the Company’s disclosure controls and procedures (as defined in
the rules of the Canadian Securities Administrators) and concluded that the
Company’s disclosure controls and procedures were effective as of December 31,
2008.
Internal
Controls over Financial Reporting
No
changes have occurred in the Company’s internal control over financial reporting
during the most recent interim period that has materially affected, or is
reasonably likely to materially affect, the Company’s internal control over
financial reporting (“ICFR”). The Chief Executive Office and Chief
Financial Officer of the Company evaluated the effectiveness of the Company’s
ICFR and, based upon this assessment, concluded that the Company’s internal
control over financial reporting was effective as of December 31,
2008.
International
Financial Reporting Standards
In
February 2008, the Canadian Accounting Standards Board ("AcSB") announced that
the requirement for publicly-accountable companies to adopt International
Financial Reporting Standards (“IFRS”), will be effective for interim and annual
financial statements relating to fiscal years beginning on or after January 1,
2011. The transition date of January 1, 2011 will require the restatement
for comparative purposes of amounts reported by the Company for the year ended
December 31, 2010.
During
2008, the Company scheduled an IFRS diagnostic study to assess the impact of the
transition to IRFS on the Company’s accounting policies and to establish a
project plan to implement IFRS. Following this initial diagnostic
step, which will be conducted during 2009, the Company will proceed to make a
determination of the impact of transition to IFRS on its financial statements
and systems, if any.
Risks
and Uncertainties
The
Company is subject to a number of risks and uncertainties due to the nature of
its business and the present stage of development of its
business. Investment in the natural resource industry in general, and
the exploration and development sector in particular, involves a great deal of
risk and uncertainty. Current and potential investors should give
special consideration to the risk factors involved. These factors are
discussed more fully in our Annual Report on Form 20-F (Annual Information Form)
dated March 18, 2009 which is filed on SEDAR at www.sedar.com or on the U.S.
Securities and Exchange Commission’s website at www.sec.gov.
Other
Information
Other
information relating to the Company may be found on the SEDAR website at
www.sedar.com or on the U.S. Securities and Exchange Commission’s website at
www.sec.gov.
Directors
and Officers
Jeffrey
T. Klenda, B.A. –Chairman and Executive Director
W.
William Boberg, M. Sc., P. Geo. – President, Chief Executive Officer and
Director
James M.
Franklin, PhD, FRSC, P. Geo. –Director and Technical Committee
Chair
Paul
Macdonell, Diploma Public Admin. – Director and Compensation Committee
Chair
Robert
Boaz, M. Econ., Hon. BA – Director and Corporate Governance and Nominating
Committee Chair
Thomas
Parker, M. Sc., P.E. – Director and Audit Committee Chair
Harold A.
Backer, B. Sc. – Executive Vice President Geology and Exploration
Wayne W.
Heili, B. Sc. – Vice President, Mining and Engineering
Paul W.
Pitman, B. Sc. Hon. Geo., P. Geo. – Vice President, Canadian
Exploration
Roger L.
Smith, CPA, MBA – Chief Financial Officer and Vice President Finance, IT
& Administration
Paul G.
Goss, J.D., MBA – Corporate Counsel and Corporate Secretary
Corporate
Offices
|
United
States Headquarters:
10758
West Centennial Road, Suite 200
Littleton
(Denver), Colorado 80127
Phone:
(720) 981-4588
|
Canadian
Exploration Office:
341
Main Street North, Suite 206
Brampton,
Ontario L6X 3C7
Phone:
(905) 456-5436
|
|
Wyoming
Operations Office:
5880
Enterprise Drive, Suite 200
Casper,
Wyoming 82609
Phone:
(307) 265-2373
|
Registered
Canadian Office:
McCarthy
Tétrault
The
Chambers, Suite 1400
40
Elgin St
Ottawa,
Ontario K1P 5K6
Phone:
(613) 238-2000
|
Web
Site
www.ur-energy.com
Trading
Symbol
TSX:
URE
NYSE
Amex: URG
Independent
Auditor
PricewaterhouseCoopers
LLP, Vancouver
Corporate
Legal Counsel
McCarthy
Tétrault LLP, Ottawa
Corporate
Banker
Royal
Bank of Canada, Ottawa
Transfer
Agent
Equity
Transfer & Trust Company, Toronto
Registrar
and Transfer Company (Co-Transfer Agent and Co-Registrar), New York