Ur-Energy Inc. (NYSE American: URG) (TSX: URE) is pleased to announce that the State of Wyoming and the EPA have completed their respective reviews of the Shirley Basin In Situ Uranium Project (the “Project”) and have issued the final Source and Byproduct Material License, Permit to Mine, and Aquifer Exemption for the Project. These three approvals represent the final major permits required to begin construction of the Shirley Basin project. We received BLM final approval of the Project, following its NEPA review process, in April 2020.
In addition to the recent receipt of a License Amendment to include the LC East and KM amendment areas in our existing Lost Creek license (See Ur-Energy News Release, March 29, 2021), these Shirley Basin license and permit approvals effectively double our authorized Wyoming-based uranium recovery production capacity.
The Shirley Basin Project hosts 8.8M pounds of Measured and Indicated Uranium Resources contained in 1.915M short tons at an average grade of 0.23% U3O8 as disclosed in our Preliminary Economic Assessment Shirley Basin Uranium Project (January 27, 2015). The Company plans three relatively shallow mining units at the Project, where we have the option of either building out a complete processing plant with drying facilities or a satellite plant with the ability to send loaded ion exchange resin to our Lost Creek Project for processing. The Shirley Basin processing facility throughput shall not exceed an average daily flow rate equivalent to 6,000 gallons per minute or a maximum instantaneous flow rate of 6,500 gallons per minute, excluding restoration flow. The annual production of dried yellowcake (U3O8) from wellfield production and toll processing of loaded resin or yellowcake slurry shall not exceed 2M pounds equivalent of dried U3O8 product. The brownfield Project is within an historic mining district with existing access, power, waste disposal facility and shop buildings onsite. The Project is construction ready, since delineation and exploration drilling were completed historically. Additionally, all wellfield, pipeline and header house layouts are finalized. Historic production from the Shirley Basin mine, including 1.5M pounds U3O8 from in situ mining, was 28.3M pounds U3O8.
Company Chairman and CEO Jeff Klenda stated, “The in situ technology now used to recover uranium across the globe was likely first commercially utilized at the Shirley Basin Mine beginning in 1963 with two successful mine units. We are excited to bring this technology back to its birthplace and believe our predecessors would be proud of how far their technology has come.”
The Company remains prepared to expand wellfield production within the already fully permitted areas of Lost Creek to an annualized run rate of approximately one million pounds when conditions warrant. Our long tenured operational and professional staff have significant levels of experience and adaptability which will 2allow for an easier transition back to full operations. Lost Creek operations can increase to full production rates in as little as six months following a “go” decision, simply by developing additional header houses within the fully permitted Mine Unit 2 (“MU2”). Development expenses during the six-month ramp up period in MU2 are estimated to be approximately $14 million and are almost entirely related to further well installation and header house construction costs. We are prepared to ramp up and to deliver our Lost Creek production inventory to the national uranium reserve being established by the U.S. Department of Energy pursuant to funding and directive of Congress. (See Ur-Energy News Release, December 22, 2020.)
In February 2021, the company raised gross proceeds of $15.2 million through an underwritten public offering. Our cash position as of February 24, 2021, was $18.6 million. In addition to our strong cash position, we have nearly 285,000 pounds of finished, ready-to-sell inventory, worth approximately $8.6 million at recent spot prices. The financing allows us to preserve our existing inventory for higher prices. The financing provides us adequate funds to maintain and enhance operational readiness, for possible future acquisitions, and for general working capital purposes.