LITTLETON, Colo., April 11, 2019 /CNW/ -- Ur-Energy Inc. (NYSE
American:URG)(TSX:URE) (the "Company" or "Ur-Energy") is pleased to
provide the following operational results for first quarter
2019.
Highlights
Lost Creek
Operations
|
|
|
Units
|
2019
Q1
|
|
2018
Q4
|
|
|
|
|
|
U3O8 Captured
|
('000
lbs)
|
22.6
|
|
48.4
|
U3O8 Dried &
Drummed
|
('000
lbs)
|
21.0
|
|
53.7
|
U3O8 Sold (from produced
lbs)
|
('000
lbs)
|
48.8
|
|
0
|
U3O8 Sold (from purchased
lbs)
|
('000
lbs)
|
48.8
|
|
0
|
|
|
|
|
|
Average Flow
Rate
|
(gpm)
|
1,469
|
|
2,019
|
U3O8 Head Grade
|
(mg/l)
|
15
|
|
23
|
|
|
|
|
|
|
Lost Creek Uranium Production and Sales
For the
quarter, 22,551 pounds of U3O8 were
captured within the Lost Creek plant, and 21,015 pounds of
U3O8 were packaged in drums at the Lost Creek
processing plant. No shipments of product were made to the
conversion facility during the quarter. At March 31, 2019, inventory at the conversion
facility was approximately 375,803 pounds
U3O8.
In Q1 2019, sales totaled $4.8
million from 97,500 pounds sold. Our price per pound sold
averaged $49.35. Half of these pounds
were from Lost Creek production, produced at a cost of
approximately $37.74 per pound, and
half were pounds purchased for delivery, with an average purchase
price of $27.51 per pound. Gross
profits from contractual sales were $1.6 million, which represents a gross
profit margin of approximately 34%. On a cash basis
(excluding non-cash costs and extraction taxes), gross profits from
contractual sales generated $2.3
million in cash, which represents a cash-basis gross profit
margin of approximately 48%.
Lost Creek Operations
Production rates at Lost Creek
during the quarter were in line with guidance for the year despite
more difficult than normal winter weather conditions in
Wyoming. Heavy snows and high
winds impeded routine flow and production maintenance and hindered
normal production activities. Notwithstanding the weather and
site conditions, our staff remained safe, with our continuing
safety record at Lost Creek intact, which now stands at over 600
days without a lost-time accident.
Section 232 Trade Action
The Department of Commerce
("DOC") continues its investigation into the impact of uranium
imports on national security, and is nearing the statutory deadline
to submit its report to the White House. It is anticipated that DOC
will submit its report to the President, containing the Secretary's
findings and recommendations of a proposed remedy, if any, very
shortly. Following receipt of the report, the President has up to
90 days to act on the Secretary's report.
Guidance for 2019
In calendar year 2019, we expect to
produce between 75,000 and 100,000 pounds at Lost Creek and deliver
a total of 500,000 pounds into our term contracts at an average
price of approximately $49 per pound.
We have purchase contracts in place for 500,000 pounds at an
average cost of $26 per pound.
In total, 451,250 pounds of purchased product and 48,750 pounds of
produced product will be delivered into the term contracts. Gross
profits are expected to be approximately $11.0 million, which represents a gross
profit margin of approximately 45%. On a cash basis (excluding
non-cash costs and extraction taxes), gross profits from
contractual sales are expected to generate $11.7 million in cash, which represents a
cash-basis gross profit margin of approximately 47%. As
discussed above, 97,500 pounds, including the 48,750 pounds from
production, were sold in Q1 2019. We do not anticipate
selling any additional produced pounds in 2019. By quarter,
our remaining 2019 contractual sales are as follows: 100,000
pounds in Q2; 122,500 pounds in Q3; and 180,000 pounds in Q4.
Should uranium pricing continue to improve, or following a
successful outcome of the ongoing Section 232 uranium
investigation, we stand ready to ramp up production to full
capacity at Lost Creek and initiate development activities at
Shirley Basin. We remain
operationally ready to increase production through the further
development of our fully-permitted mine unit two ("MU2") at Lost
Creek. Lost Creek operations could increase production rates in as
little as six months following a "go" decision simply by developing
additional header houses within MU2. Development expenses during
this time are estimated to be less than $14
million and are almost entirely related to MU2 drilling and
header house construction costs. Lost Creek does not require any
significant capital expenditures in order to increase production,
but we will continue to optimize site operations through
engineering design enhancements and modifications. The Lost Creek
plant has been well maintained and is ready to receive additional
flows for increased production when warranted.
We will provide further guidance in our Form 10-Q, which is
currently anticipated to be filed on Friday,
May 3, 2019, and throughout the year as matters
progress.
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 approximately 2.5 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 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 NYSE American under the symbol "URG" and on the Toronto
Stock Exchange under the symbol "URE." Ur-Energy's corporate office
is 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
+1 720-981-4588
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.,
continuing results of Lost Creek operations and the timing and
ability to ramp up operations; timing and outcome for resolution of
the Section 232 trade action or other changes to the uranium
market; timing and outcome for all permitting and licensure of the
Shirley Basin project and for the
subsequent buildout of the project; projected sales and costs of
sales; and whether adjustments of production rates at Lost Creek
will be necessary or appropriate during 2019) 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, fluctuations in commodity prices; capital and other
costs varying significantly from estimates; failure to establish
estimated resources and reserves; the grade and recovery of uranium
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; 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.