Uranium Energy (UEC) 10-K2022 FY Annual report

CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

This Form 10-K Annual Report and any documents incorporated herein by reference (collectively, the “Annual Report”) include statements and information about our strategy, objectives, plans and expectations for the future that are not statements or information of historical fact. These statements and information are considered to be forward-looking statements, or forward-looking information, within the meaning of and under the protection provided by the safe harbor provisions for forward-looking statements as contained in the Private Securities Litigation Reform Act of 1995 and similar Canadian securities laws.

Forward-looking statements, and any estimates and assumptions upon which they are based, are made in good faith and reflect our views and expectations for the future as of the date of this Annual Report, which can change significantly. Furthermore, forward-looking statements are subject to known and unknown risks and uncertainties which may cause actual results, performance, achievements or events to be materially different from any future results, performance, achievements or events implied, suggested or expressed by such forward-looking statements. Accordingly, forward-looking statements in this Annual Report should not be unduly relied upon.

Forward-looking statements may be based on a number of material estimates and assumptions, of which any one or more may prove to be incorrect. Forward-looking statements may be identifiable by terminology concerning the future, such as “anticipate”, “believe”, “continue”, “could”, “estimate”, “expect”, “forecast”, “intend”, “goal”, “likely”, “may”, “might”, “outlook”, “plan”, “predict”, “potential”, “project”, “should”, “schedule”, “strategy”, “target”, “will” or “would”, and similar expressions or variations thereof including the negative use of such terminology. Examples in this Annual Report include, but are not limited to, such forward-looking statements reflecting or pertaining to:

Forward-looking statements, and any estimates and assumptions upon which they are based, are made as of the date of this Annual Report, and we do not intend or undertake to revise, update or supplement any forward-looking statements to reflect actual results, future events or changes in estimates and assumptions or other factors affecting such forward-looking statements, except as required by applicable securities laws. Should one or more forward-looking statements be revised, updated or supplemented, no inference should be made that we will revise, update or supplement any other forward-looking statements.

Forward-looking statements are subject to known and unknown risks and uncertainties. As discussed in more detail under Item 1A. Risk Factors herein, we have identified a number of material risks and uncertainties which reflect our outlook and conditions known to us as of the date of this Annual Report, including but not limited to the following:

Any one of the foregoing material risks and uncertainties has the potential to cause actual results, performance, achievements or events to be materially different from any future results, performance, achievements or events implied, suggested or expressed by any forward-looking statements made by us or by persons acting on our behalf. Furthermore, there is no assurance that we will be successful in preventing the material adverse effects that any one or more of these material risks and uncertainties may cause on our business, prospects, financial condition and operating results, or that the foregoing list represents a complete list of the material risks and uncertainties facing us. There may be additional risks and uncertainties of a material nature that, as of the date of this Annual Report, we are unaware of or that we consider immaterial that may become material in the future, any one or more of which may result in a material adverse effect on us.

Forward-looking statements made by us or by persons acting on our behalf are expressly qualified in their entirety by the foregoing cautionary information.

CAUTIONARY NOTE TO U.S. RESIDENTS CONCERNING DISCLOSURE OF MINERAL RESOURCES

The Company is a U.S. Domestic Issuer for United States Securities and Exchange Commission (“SEC”) purposes, most of its shareholders are U.S. residents, the Company is required to report its financial results under U.S. Generally Accepted Accounting Principles (“U.S. GAAP”) and its only trading market is the NYSE American.  However, because the Company is a reporting issuer in Canada, certain prior regulatory filings required of the Company in Canada contain or incorporate by reference therein certain disclosure that satisfies the additional requirements of Canadian securities laws, which differ from the requirements of United States’ securities laws.  Unless otherwise indicated, all Company resource estimates included in those Canadian filings, and in the documents incorporated by reference therein, had been prepared in accordance with Canadian National Instrument 43-101 - Standards of Disclosure for Mineral Projects (“NI 43-101”) and the Canadian Institute of Mining, Metallurgy and Petroleum classification system.  NI 43-101 is a rule developed by the Canadian Securities Administrators which establishes standards for all public disclosure an issuer makes of scientific and technical information concerning mineral projects.

Canadian standards, including NI 43-101, differ significantly from the requirements of SEC Industry Guide 7, as defined in the Glossary of Technical Terms (“Industry Guide 7”).  Thus, resource information contained, or incorporated by reference, in our Canadian filings, and in the documents incorporated by reference therein, may not be comparable to similar information disclosed by companies reporting “reserve” and resource information under SEC Industry Guide 7.

SEC Industry Guide 7 disclosure standards historically have not permitted the inclusion of information concerning “Measured Mineral Resources,” “Indicated Mineral Resources” or “Inferred Mineral Resources” or other descriptions of the amount of mineralization in mineral deposits that do not constitute “reserves” by SEC Industry Guide 7 standards.  United States investors should also understand that “Inferred Mineral Resources” have a great amount of uncertainty as to their existence and as to their economic and legal feasibility.  It cannot be assumed that all or any part of an “Inferred Mineral Resource” will ever be upgraded to a higher category.  Under Canadian rules, estimated “Inferred Mineral Resources” may not form the basis of feasibility or pre-feasibility studies.  United States investors are cautioned not to assume that all or any part of Measured or Indicated Mineral Resources will ever be converted into mineral “reserves” as defined by SEC Industry Guide 7. Investors are cautioned not to assume that all or any part of an “Inferred Mineral Resource” exists or is economically or legally mineable. The Company does not have any mineral “reserves” within the meaning of SEC Industry Guide 7.

On October 31, 2018, the SEC adopted the Modernization of Property Disclosures for Mining Registrants (the “New Rule”), introducing significant changes to the existing mining disclosure framework to better align it with international industry and regulatory practice, including NI 43-101.  The New Rule became effective as of February 25, 2019, and issuers are required to comply with the New Rule as of the annual report for their first fiscal year beginning on or after January 1, 2022, and earlier in certain circumstances.  The Company believes that it is now complying with the New Rule in accordance with the filing of this Annual Report and its related filings.

REFERENCES

As used in this Annual Report: (i) the terms “we”, “us”, “our”, “Uranium Energy”, “UEC” and the “Company” mean Uranium Energy Corp., including our wholly-owned subsidiaries and a controlled partnership; (ii) “SEC” refers to the United States Securities and Exchange Commission; (iii) “Securities Act” refers to the United States Securities Act of 1933, as amended; (iv) “Exchange Act” refers to the United States Securities Exchange Act of 1934, as amended; and (v) all dollar amounts refer to United States dollars unless otherwise indicated.

PART I

Item 1. Business

Uranium Energy Corp. (UEC: NYSE AMERICAN) is a fast growing, uranium mining company listed on the NYSE American. UEC is working towards fueling the global demand for carbon-free nuclear energy, a key solution to climate change, and energy source for the low-carbon future.

UEC is a pure-play uranium company and is advancing its next generation of low-cost, environmentally friendly, In-Situ Recovery (“ISR”) mining uranium projects. The Company has two extraction ready ISR hub and spoke platforms in South Texas and Wyoming, anchored by fully licensed and operational processing capacity at its Hobson and Irigaray plants.

UEC also has seven U.S. ISR uranium projects with all of their major permits in place, with additional diversified holdings of uranium assets across the U.S., Canada and Paraguay.

We believe nuclear energy will continue to be an important part of the energy transition and the energy mix of a future low carbon economy. As such, we are focused on scaling our business to meet the future energy needs for nuclear in the U.S. and globally.

Corporate Organization

Uranium Energy Corp. was incorporated under the laws of the State of Nevada on May 16, 2003 under the name Carlin Gold Inc. During 2004 we changed our business operations and focus from precious metals exploration to uranium exploration in the United States. On January 24, 2005, we completed a reverse stock split of our common stock on the basis of one share for each two outstanding shares and amended our Articles of Incorporation to change our name to Uranium Energy Corp. Effective February 28, 2006, we completed a forward stock split of our common stock on the basis of 1.5 shares for each outstanding share and amended our Articles of Incorporation to increase our authorized capital from 75,000,000 shares of common stock, with a par value of $0.001 per share, to 750,000,000 shares of common stock, with a par value of $0.001 per share. In June 2007 we changed our fiscal year end from December 31^st to July 31^st (in each instance our “Fiscal” year now).

On December 31, 2007, we incorporated a wholly-owned subsidiary, UEC Resources Ltd., under the laws of the Province of British Columbia, Canada. On December 18, 2009, we acquired a 100% interest in the South Texas Mining Venture, L.L.P. (“STMV”), a Texas limited liability partnership, from each of URN Resources Inc., a subsidiary of Uranium One Inc., and Everest Exploration, Inc. On September 3, 2010, we incorporated a wholly-owned subsidiary, UEC Paraguay Corp., under the laws of the State of Nevada. On May 24, 2011, we acquired a 100% interest in Piedra Rica Mining S.A., a private company incorporated in Paraguay. On September 9, 2011, we acquired a 100% interest in Concentric Energy Corp. (“Concentric”), a private company incorporated in the State of Nevada.  On March 30, 2012, we acquired a 100% interest in Cue Resources Ltd. (“Cue”), a formerly publicly-traded company incorporated in the Province of British Columbia, Canada. On March 4, 2016, we acquired a 100% interest in JDL Resources Inc., a private company incorporated in the Cayman Islands. On July 7, 2017, we acquired a 100% interest in CIC Resources (Paraguay) Inc., a private company incorporated in the Cayman Islands. On August 9, 2017, we acquired a 100% interest in AUC Holdings (US), Inc. (“AUC”). On January 31, 2018, we incorporated a wholly-owned subsidiary, UEC Resources (SK) Corp., under the laws of the Province of Saskatchewan, Canada. On December 17, 2021, we acquired a 100% interest in Uranium One Americas, Inc. (“U1A”) (now UEC Wyoming Corp.).

Our principal office is located at 1030 West Georgia Street, Suite 1830, Vancouver, British Columbia, Canada, V6E 2Y3.

General Business

UEC’s goal is to provide the much needed fuel for the global energy transition. The International Energy Outlook projects that worldwide electricity generation will grow by 1.8% per year, through to 2050. As the global community calls on all governments and industries to curb their carbon emissions to stop the effects of climate change, there is growing need to combine intermittent renewable energy sources, such as wind and solar, with one or more “firm” zero-carbon sources, such as nuclear energy, to ensure the affordability and accessibility of the net-zero electricity grid.

We are predominantly engaged in uranium mining and related activities, including exploration, pre-extraction, extraction and processing, on uranium projects located in the United States, Canada and the Republic of Paraguay.  We utilize ISR mining where possible which we believe, when compared to conventional open pit or underground mining, requires lower capital and operating expenditures with a shorter lead time to extraction and a reduced impact on the environment. We do not expect, however, to utilize ISR mining for all of our uranium projects in which case we would expect to rely on conventional open pit and/or underground mining techniques.  We have one uranium mine located in the State of Texas, our Palangana Mine, which utilizes ISR mining and commenced extraction of uranium oxide (“U₃O₈”), or yellowcake, in November 2010. We have one uranium processing facility located in the State of Texas, our Hobson Processing Facility, which processes material from our ISR Mines into drums of U₃O₈, our only sales product and source of revenue, for shipping to a third-party storage and sales facility.  Since commencement of uranium extraction from our ISR Mines in November 2010 to July 31, 2022, our Hobson Processing Facility has processed 578,000 pounds of U₃O₈. As at July 31, 2022, we had no uranium supply or “off-take” agreements in place.

Our fully-licensed and 100%-owned Hobson Processing Facility forms the basis for our regional operating strategy in the State of Texas, specifically in the South Texas Uranium Belt, where we utilize ISR mining. We utilize a “hub-and-spoke” strategy whereby the Hobson Processing Facility acts as the central processing site (the “hub”) for our Palangana Mine and future satellite uranium mining activities, such as our Burke Hollow and Goliad Projects, located within the South Texas Uranium Belt (the “spokes”). The Hobson Processing Facility has a physical capacity to process uranium-loaded resins up to a total of two million pounds of U₃O₈ annually and is licensed to process up to one million pounds of U₃O₈ annually.

As at July 31, 2022, we hold certain mineral rights in various stages in the States of Arizona, Colorado, New Mexico, Texas and Wyoming, in Canada and in the Republic of Paraguay, many of which are located in historically successful mining areas and have been the subject of past exploration and pre-extraction activities by other mining companies. We do not expect, however, to utilize ISR mining for all of our uranium projects in which case we would expect to rely on conventional open pit and/or underground mining techniques.

Our operating and strategic framework is based on expanding our uranium extraction activities, which includes advancing certain uranium projects with established mineralized materials towards uranium extraction, and establishing additional mineralized materials on our existing uranium projects or through acquisition of additional uranium projects.

Physical Uranium Program

The Company is investing in building the next generation of low-cost and environmentally friendly uranium projects that will be competitive on a global basis. Despite our focus on low cost ISR mining with its low capital requirements, we saw a unique opportunity to purchase drummed uranium at prevailing spot prices which are below most global industry mining costs. Hence, we established a physical uranium portfolio (the “Physical Uranium Program”) and, as of the date of this Annual Report, have entered into agreements to purchase 5.5 million pounds of U.S. warehoused uranium of which various deliveries have, or are scheduled to occur, in March 2022 to December 2025 at the ConverDyn conversion facility located in Metropolis, Illinois, at a volume weighted average price of approximately $37.30 per pound.

Our Physical Uranium Program will support three objectives for our Company: (i) to bolster our balance sheet as uranium prices appreciate; (ii) to provide strategic inventory to support future marketing efforts with utilities that could compliment production and accelerate cash flows; and (iii) to increase the availability of our Texas and Wyoming production capacity for emerging U.S. origin specific opportunities which may command premium pricing due to the scarcity of domestic uranium. One such U.S. origin specific opportunity is the Company’s plan to participate in supplying the Uranium Reserve, as outlined in the Nuclear Fuel Working Group report published by the U.S. Department of Energy (the “UR”). 

During the year ended July 31, 2022 (“Fiscal 2022”), we made significant advancements in various aspects of our operations, including:

Uranium Industry Background

Since the ratification of the Paris Agreement; a legally binding international treaty on climate change that was adopted by 196 parties in Paris on December 15, 2015 and entered into on November 6, 2016; the global community has embarked on a challenging but necessary journey to decarbonize the global energy mix in order to limit global warming to well below a two degree scenario compared to pre-industrial levels. The Paris Agreement reaffirms that developed countries should take the lead in providing financial assistance to countries that are less endowed and more vulnerable, while for the first time also encouraging voluntary contributions by other parties. Climate finance is needed for mitigation, because large-scale investments are required to significantly reduce emissions.

According to the International Energy Agency (“IEA”), in order to meet net-zero by 2050 global goals, the global community will need to halt sales of new internal combustion engine passenger cars by 2035, and phase out all unabated coal and oil power plants by 2040.

Nuclear energy will play a key role in the future energy mix, due to its consistency and reliability, which other carbon-free energy sources are unable to provide in their current form. According to research conducted by Harvard University, the Massachusetts Institute of Technology and the Organization for Economic Cooperation and Development, powering the grid with 100% renewables is not the most affordable path towards creating a carbon-free grid. Instead, this research has concluded that the best way to achieve net-zero emissions from the grid is to combine intermittent low-carbon sources, such as wind and solar, with one or more “firm” zero-carbon sources, such as nuclear energy (source: Nuclear Energy: Essential Clean Energy For a Low Carbon Economy, Nuclear Energy Institute).

The need for safe, reliable, pollution-free electricity continues to rise as the world’s population grows to new record levels. The world’s population of 8 billion in 2022 is projected to increase over 1% per year to a population near 8.6 billion by 2030. The need for more electricity and efforts to reach global climate change goals with clean energy sources are increasingly important drivers for the projected long-term increase in nuclear power and uranium demand.

There has been a new and vibrant interest in nuclear power as more countries realize that nuclear power is indispensable for decarbonizing the globe, stabilizing electrical grids and supplementing intermittent power sources. Elevated interest in nuclear power has also been one of the results of the Russian invasion of Ukraine with Russia cutting off gas supplies to Western Europe. The lack of alternative energy sources has exposed the risks to national security for these countries as a result of their Russian over dependency, and indigenous nuclear power is proving to be a good option to mitigate that threat. The world’s current operating fleet of nuclear power plants, in addition to the global growth in new reactors under construction and those planned, is testimony to the confidence in nuclear power to provide safe, highly reliable, economic and carbon free electricity as part of an overall energy supply mix.

The World Nuclear Association (“WNA”) reported: “nuclear reactors generated a total of 2653 TWh in 2021, up 100 TWh from 2553 TWh in 2020. This is the third highest ever total for global generation from nuclear… and reestablishes the upward trend in nuclear generation seen since 2012.” The IEA World Energy Outlook in 2021 projected “electricity generation growth of between 75% and 116% over 2020-2050 across its three main scenarios. In the report’s Sustainable Development Scenario, “nuclear generation increases by 2022 TWh (75%) over the same period, requiring capacity growth of about 254 GW, or 61%.” As of July 31, 2022, the IAEA Power Reactor Information System shows more than 6 GWe of new nuclear capacity has been added in 2022 while 1.85 GWe has been retired, and construction has begun on four new reactors this year with a total capacity of 4.6 GWe. 

As of July 2022, WNA data showed a total of 443 nuclear reactors operable in 32 countries, with a combined capacity of about 394 GWe. Their data also showed 59 new reactors under construction, 89 reactors planned or on order and another 340 proposed. While most of the growth in nuclear power is coming from countries like China and Russia, there is also notable growth in other countries, including India and the United Arab Emirates. Some of these countries have embarked on sovereign-backed uranium acquisition programs, building inventory stockpiles for their future requirements. This also includes substantial long-term contracting with western suppliers and taking controlling interests in individual mines. In addition, Russia, China and South Korea are aggressively pursuing programs to sell their reactors around the globe. In many cases the sales agreements contain turnkey provisions, including uranium supply as a component of the reactor package that will require far more uranium than they currently produce. As such, they will need to carve out large supply sources in the coming years.

While global generation from nuclear power has eclipsed pre-Fukushima levels, Japan restarts have been slower than expected. As of August 1, 2022, a total of 26 reactors had applied for restart, including ten reactors that have restarted. More restarts are expected as Japan completes additional safety programs and ramps back up towards a policy goal of 20 to 22 percent of their total electrical generation from nuclear power by 2030. Japanese Prime Minister Fumio Kishida recently said he has asked for as many as nine nuclear reactors to be online this coming winter to help offset expected power shortages.

The United States has the world’s largest nuclear fleet and produces about 30% of the world’s nuclear generation. The U.S. Department of Energy (“DOE”) Energy Information Administration reported U.S. nuclear plants continued to be the nation’s most reliable energy source with an average capacity factor of more than 93 percent this past year. For context, capacity factors for other sources of energy were natural gas (54%), coal (49%), wind (35%) and solar (25%). In 2021, nuclear plants provided more than half of U.S carbon free energy and about 20% of its total generation. As of August 2022, the operating U.S. reactor fleet stands at 92 reactors, with two new commercial reactors under construction (Vogtle 3 and 4 in Georgia). While some U.S. reactors have been shut down prematurely, the overall generating capacity remains strong as a result of plant reactor upgrade programs and license extensions. In terms of uranium demand, the U.S. nuclear fleet is the world’s largest uranium consumer and has averaged about 46 million pounds of uranium a year over the past decade.

Regarding uranium supply, the WNA’s 2021 Fuel Report noted: “regardless of the particular scenario in the long term, the industry needs to at least double its development pipeline of new projects by 2040”. And they also noted: “Over the longer term, the Reference Scenario shows demand for uranium growing by 3.1% compound average growth rate.” The 2021 report also noted that in all scenarios “world reactor requirements for uranium in 2040 are approximately 12% higher” than in the previous 2019 report. World base case uranium demand is forecasted to be about 204 million pounds U₃O₈ in 2022, exceeding the 134 million pounds of projected production by about 70 million pounds (source: UxC 2022 Q2 UMO). While the difference between primary production and reactor demand is currently being filled with secondary market supplies, this is not a sustainable long-term supply source. Projections from UxC 2022 Q2 MO show secondary market supplies dropping to less than 24 million pounds per year over the next 4 years.

The U.S. uranium mining industry was formerly the world’s largest producer but is now producing virtually no uranium. The United States has become almost entirely dependent on foreign supply, with about 60% being imported from State Owned Enterprises (“SOE”) in Russia and other former Soviet Union (“FSU”) countries, including Kazakhstan and Uzbekistan. However, actions taken by the U.S. federal government over the past couple of years have culminated in a foundation for the industry to recover. Most notably, the prior administration established the U.S. Nuclear Fuel Working Group (“NFWG”) comprised of various government agencies “to develop recommendations for reviving and expanding domestic nuclear fuel production”.

The NFWG recommendations were released in a report entitled, “Restoring America’s Competitive Nuclear Energy Advantage”. The report broadly advocates for increased U.S. leadership in nuclear energy, both at home and abroad, with a focus on U.S. national security objectives that includes lessening dependence on SOE supply. Uranium mining is the starting point in the strategy with a program to purchase 17 to 19 million pounds of U.S. uranium for a strategic Uranium Reserve. That Administration’s policy outlined a 10-year, $1.5 billion UR program.  In 2020, the U.S. Congress approved $75 million for initial funding for fiscal year 2021. In July of 2022, the DOE National Nuclear Security Administration (“NNSA”) issued Requests for Proposals (“RFP”) to the U.S. producers that had produced uranium since 2009, for an initial quantity of up to 1 million pounds of domestic uranium. Results of the NNSA RFP are expected to be known this year at the end of September.

The global uranium market suffered a long downturn after peaking in 2007 at $138 per pound U₃O₈ that was followed by a rebound and then a subsequent drop of about 75% from early 2011 into the 2016 low of $17.75 per pound.  However, the market has been showing a slow recovery since, and was up by approximately 175% going into August 2022 from the 2016 low. Global fundamentals are in process of rebalancing the uranium market and driving an improvement in the price of uranium. Significant purchasing by producers to fill long-term supply contracts, as well as financial entities buying significant quantities of uranium for appreciation purposes, have all been contributing to the upward movement in uranium prices. Other factors that have affected global production include production shutdowns or reductions as a result of the COVID-19 pandemic that removed almost 20 million pounds of production in 2020 that will not be made up. While most of the impacted mines have or are in the process of ramping back up operations, there are still lingering factors affecting production. In early August, the world’s largest producer (Kazatomprom) announced the pandemic “disrupted the overall production supply chain in 2021, resulting in a shortage of certain production materials, such as reagents and piping which led to a shift in the commissioning schedule for new wellfields.”

This year the nuclear fuel markets have experienced a fundamental change after Russia invaded Ukraine with western utilities beginning an almost immediate shift away from Russian supply. Industry consultant “TradeTech” reported that the new trend “is foreshadowing a potential bifurcation in the nuclear fuel markets.” While the markets are still sorting out what all the impacts might be, one of the more likely postulated outcomes is a western market that will not receive much if any supply from suppliers in the Commonwealth of Independent States (the “CIS”). The CIS includes Russia, Kazakhstan and Uzbekistan that together supplied about 60% of U.S. uranium requirements in 2021, a new record high from these FSU countries. Most western utilities with suppliers in the CIS are already pursing increased diversification strategies with supply options from the U.S and its allies that are in more stable jurisdictions. While sanctions banning some Russian energy sources have been implemented in the U.S., there has not been a ban placed on Russian uranium to date, although legislation has been introduced to do so. Transportation issues are also impacting uranium supply with routes through Russian ports or supply on Russian vessels running into legal constraints. While alternate routes are being worked on (i.e. the Caspian Sea), to date these routes are not fully functioning.  As a result, there has been additional buying on the spot market by the impacted suppliers.

Ultimately, the forces of supply and demand will dictate the uranium market’s future direction. While the global market has clearly improved since the 2016 low, we still expect several major drivers to further bolster prices. Higher priced contracts that have supported high production costs have largely rolled out of producer and utility supply portfolios. These higher priced contracts are not expected to be replaceable with current market prices still below levels needed to sustain profitable mining operations for many western producers. Several projects that have produced significant quantities of uranium for many years have been shut down as a result of resource depletion and the WNA notes: “more mines are expected to close over the next decade”. SOE supply is also likely to be reduced in the U.S. and Western European markets with the fallout from Russia’s invasion of Ukraine that has exposed serious national security risks to those countries with overdependence on Russian energy sources. Global supply demand numbers are showing a cumulative structural supply deficit of approximately 440 M lbs in 2022 through 2032, despite several new production projects expected to come online. The supply dynamics in western countries are still unfolding, as western utilities look to explore and secure alternative supply options in more stable jurisdictions.

On the demand side of the equation, further upside market pressure also appears likely to evolve as utilities return to a longer-term contracting cycle to replace expiring contracts. Utilities will most likely need to do a lot more contracting in upcoming years with more than 50% of their requirements showing uncommitted by 2029. That factor and the growing recognition that nuclear power will need to be part of the solution to meet climate change objectives underpin a solid growth story for long term uranium producers.

As these and other market forces unfold, the secondary market supply is forecasted to become a less important driver, paving the way for a more production cost driven market. Lead times for new production typically range from seven to 10 years or longer. The market appears to be within the time frames required for investment to bring new supply online to meet those lead times. While some producers have announced restart plans, prices are not yet at levels that incentivize future production for many producers, increasing the probability of the potential for less supply than the market is currently pricing in.

Titanium (TiO2) Industry Updates

During Fiscal 2022, the market fundamentals for titanium dioxide remained positive. There is no economical substitute or environmentally safe alternative to titanium dioxide. Titanium dioxide is used in many “quality of life” products for which demand historically has been linked to global gross domestic product (“GDP”), ongoing urbanization trends and discretionary spending.  90% of all the mined titanium feedstocks are used to manufacture pure titanium dioxides – a pigment that enhances brightness and opacity in paints, inks, paper, plastics, food products and cosmetics. The remaining 10% of supply is used in the production of titanium metal and steel fabrication.

Demand for titanium feedstocks, such as ilmenite, is closely tied to titanium dioxide pigment demand. The global titanium pigment demand fundamentals are underpinned by urbanization and rising living standards and as such the long-term demand fundamentals remain robust. Demand for titanium pigment rebounded strongly during the first half of 2022 due to global economic growth, while the supply of titanium dioxide feedstock was impacted due to difficulties encountered by some producers which had a direct effect on prices. Existing producers continue to report increasing ilmenite prices due to low inventories throughout the supply chain with prices and demand expected to remain robust throughout 2022.

In addition to above mentioned supply constraints, the nature of feedstock supply is also changing. China, the world’s largest feedstock market, is increasingly more reliant on higher quality feedstocks. Chinese domestic ilmenite is mainly unsuitable for processing under the stricter environmental regulations and, as such, the long-term global shift towards chloride pigment production will continue to drive overall high-quality feedstock demand and prices.  

In our view, what appear to be longer-term supply and demand fundamentals and, more specifically, the long-term global shift towards higher grade feedstocks, have the potential to keep upward pressure on high-quality feedstock prices.

In-Situ Recovery (ISR) Mining

We utilize in-situ recovery or ISR uranium mining for our South Texas projects as well as our Reno Creek Project in Wyoming, and will continue to utilize ISR mining whenever such alternative is available to conventional mining. When compared to conventional mining, ISR mining requires lower capital expenditures, has a reduced impact on the environment, and results in a shorter lead time to uranium recovery.

ISR mining is considered considerably more environmentally friendly compared to alternative, traditional mining approaches, as the ISR process does not require blasting or waste rock movement, resulting in less damage to the environment, minimal dust, and no resulting tailings or tailings facilities. Further, ISR mining is more discrete and, therefore, land access does not typically have to be restricted, and the area may be restored to its pre-mining usage faster than when applying traditional mining approaches.

ISR mining involves circulating oxidized water through an underground uranium deposit, dissolving the uranium and then pumping the uranium-rich solution to the surface for processing. Oxidizing solution enters the formation through a series of injection wells and is drawn to a series of communicating extraction wells. To create a localized hydrologic cone of depression in each wellfield, more groundwater will be produced than injected. Under this gradient, the natural groundwater movement from the surrounding area is toward the wellfield, providing control of the injection fluid. Over-extraction is adjusted as necessary to maintain a cone of depression which ensures that the injection fluid does not move outside the permitted area.

The uranium-rich solution is pumped from an ore zone to the surface and circulated through a series of ion exchange columns located at the mine site. The solution flows through resin beds inside an ion exchange column where the uranium bonds to small resin beads. As the solution exits the ion exchange column, it is mostly void of uranium and is re-circulated back to the wellfield and through the ore zone. Once the resin beads are fully-loaded with uranium, they are transported by truck to our Hobson Processing Facility and transferred to a tank for flushing with a brine solution, or elution, which strips the uranium from the resin beads. The stripped resin beads are then transported back to the mine and reused in the ion exchange columns. The uranium solution, now free from the resin, is precipitated out and concentrated into a slurry mixture and fed to a filter press to remove unwanted solids and contaminants. The slurry is then dried in a zero-emissions rotary vacuum dryer, packed in metal drums and shipped out as uranium concentrates, or yellowcake, to a conversion facility for storage and sales.

Each project is divided into a mining unit, known as a Production Area Authorization (“PAA”), which lies inside an approved Mine Permit Boundary. Each PAA will be developed, extracted and restored as one unit and will have its own set of monitor wells. It is common to have multiple PAAs in extraction at any one time with additional units in various states of exploration, pre-extraction and/or restoration.

After mining is complete in a PAA, aquifer restoration will begin as soon as practicable and will continue until the groundwater is restored to pre-mining conditions. Once restoration is complete, a stability period of no less than one year is scheduled with quarterly baseline and monitor well sampling. Wellfield reclamation will follow after aquifer restoration is complete and the stability period has passed.

Hobson Processing Facility

Our Hobson Processing Facility is located in Karnes County, Texas, about 100 miles northwest of Corpus Christi. It was originally licensed and constructed in 1978, serving as the hub for several satellite mining projects until 1996, and completely refurbished in 2008. On December 18, 2009, we acquired the Hobson Processing Facility as part of our acquisition of STMV.

With a physical capacity to process uranium-loaded resins up to a total of two million pounds of U₃O₈ annually and licensed to process up to one million pounds of U₃O₈ annually, our fully-licensed and 100%-owned Hobson Processing Facility forms the basis for our “hub-and-spoke” strategy in the State of Texas, specifically in the South Texas Uranium Belt, where we utilize ISR mining.

Palangana Mine

We hold various mining lease and surface use agreements generally having an initial five-year term with extension provisions, granting us the exclusive right to explore, develop and mine for uranium at our Palangana Mine, a 6,406-acre property located in Duval County, Texas, approximately 100 miles south of the Hobson Processing Facility. These agreements are subject to certain royalty and overriding royalty interests indexed to the sales price of uranium.

On December 18, 2009, we acquired the Palangana Mine as part of our acquisition of STMV. In November 2010, the Palangana Mine commenced uranium extraction utilizing ISR mining and in January 2011 the Hobson Processing Facility began processing resins received from the Palangana Mine.

Material Relationships Including Long-Term Delivery Contracts

As at July 31, 2022, we had no uranium supply or “off-take” agreements in place.

Given that there are up to approximately 60 different companies as potential buyers in the uranium market, we are not substantially dependent upon any single customer to purchase uranium extracted by us.

Seasonality

The timing of our uranium concentrate sales is dependent upon factors such as extraction results from our mining activities, cash requirements, contractual requirements and perception of the uranium market. As a result, our sales are neither tied to nor dependent upon any particular season. In addition, our ability to extract and process uranium does not change on a seasonal basis. Over the past ten years uranium prices have tended to decline during the calendar third quarter before rebounding during the fourth quarter, but there does not appear to be a strong correlation.

Mineral Rights

In Texas our mineral rights are held exclusively through private leases from the owners of the land/mineral/surface rights with varying terms. In general, these leases provide for uranium and certain other specified mineral rights only including surface access rights for an initial term of five years and renewal for a second five-year term. We have amended the majority of the leases to extend the time period for an additional five years past the original five-year renewal periods. Our Burke Hollow and some of our Goliad Project leases have a fixed royalty amount based on net proceeds from sales of uranium, and our other projects have production royalties calculated on a sliding-scale basis tied to the gross sales price of uranium. Remediation of a property is required in accordance with regulatory standards, which may include the posting of reclamation bonds.

In Arizona, Colorado, New Mexico and Wyoming our mineral rights are held either exclusively or through a combination of federal mining claims and state and private mineral leases. Remediation of a property is required in accordance with regulatory standards, which may include the posting of reclamation bonds. Our federal mining claims consist of both unpatented lode and placer mining claims registered with the U.S. Bureau of Land Management (“BLM”) and the appropriate counties. These claims provide for all mineral rights including surface access rights for an indefinite period. Annual maintenance requirements include BLM claim fees of $165 per claim due yearly on September 1^st.  Our state mineral leases are registered with their respective states. These leases provide for all mineral rights, including surface access rights, to be subject to a production royalty of 4% in Wyoming and 5% to 6% in Arizona, ranging from a five-year term in Arizona to a ten-year term in Wyoming. Annual maintenance requirements include lease fees of between $1 and $3 per acre and minimum exploration expenditure requirements of between $10 and $20 per acre in Arizona. Our private mineral leases are negotiated directly with the owners of the land/mineral/surface rights with varying terms. These leases provide for uranium and certain other specified mineral rights only, including surface access rights, subject to production royalties, ranging from an initial term of five to seven years and renewal for a second five-year to seven-year term, and some of which have an initial term of 20 years.

Under the mining laws of Saskatchewan, Canada, title to mineral rights for our Diabase Project is held through The Crown Minerals Act of the Province of Saskatchewan.  In addition, The Mineral Resources Act, 1985 and The Mineral Tenure Registry Regulations affect the rights and administration of mineral tenure in Saskatchewan. Our Diabase Project lands are currently claimed as “Crown dispositions” or “mineral dispositions”. Subject to section 19 of The Crown Minerals Act, a claim grants to the holder the exclusive right to explore for any Crown minerals that are subject to these regulations within the claim lands. Claims are renewed annually and the claim holder is required to satisfy work expenditure requirements. Expenditure requirements are $Nil for the first year, $15 per hectare for the second year to the tenth year of assessment work periods and $25 per hectare for the eleventh year and subsequent assessment work periods. For registering exploration expenditures, mineral dispositions may be grouped at the time of submission if the total mineral disposition area is not greater than 18,000 hectares. The holder may also submit a cash payment or cash deposit in lieu of a work assessment submission for not more than three consecutive work periods. A claim may be converted to a mineral lease upon application and payment of a registration fee.

Under the mining laws of the Republic of Paraguay, title to mineral rights for our Yuty Project is held through a “Mineral Concession Contract” approved by the National Congress and signed between the Government of the Republic of Paraguay and the Company, and titles to mineral rights for our Oviedo Project and our Alto Paraná Titanium Project are held through “Exploration Mining Permits” granted by the Ministry of Public Works and Communications (“MOPC”), the mining regulator in Paraguay. These mineral rights provide for the exploration of metallic and non-metallic minerals and precious and semi-precious gems within the territory of Paraguay for up to a six-year period, and for the exploitation of minerals for a minimum period of 20 years from the beginning of the production phase, extendable for an additional ten years.

Environmental, Social and Governance Overview

UEC is dedicated to preserving the environment in which we operate, and to being a responsible neighbor to our local communities. We believe in mining in a responsible manner, such as through the deployment of ISR technology when possible, adhering to all applicable environmental regulations and managing and reducing our carbon emissions. UEC believes that uranium and nuclear energy will be an important part of the energy transition as it can provide reliable and consistent power to the grid. Ensuring responsible mining practices better positions nuclear to be an energy source of choice to governments, and enables us to be a better partner and corporate citizen to our local communities.

Environmental Management

Environmental Governance

UEC approved an Environmental, Health and Safety Policy in Fiscal 2022 which sets out objectives and provides overarching guidelines for the management of the environment. This enterprise-wide policy can be found at https://www.uraniumenergy.com/about/corporate-governance/. Topics covered in this policy include the management of hazardous waste, water, biodiversity and land use, air quality and pollutants, green-house gas (“GHG”) emissions, and energy management. Adherence to and performance against this policy will be reviewed by our Board of Directors’ Sustainability Committee annually.

Environmental Regulations

We believe that we comply with all federal, state and local applicable laws and regulations which govern environmental quality and pollution control.  Our operations are subject to stringent environmental regulation by state and federal authorities including the Railroad Commission of Texas (“RCT”), the Texas Commission on Environmental Quality (“TCEQ”) and the United States Environmental Protection Agency (“EPA”).

In Texas, where the Company’s hub-and-spoke operations are anchored by the fully-licensed Hobson Processing Facility, surface extraction and exploration for uranium is regulated by the RCT, while ISR uranium extraction is regulated by the TCEQ. An exploration permit is the initial permit granted by the RCT that authorizes exploration drilling activities inside an approved area. This permit authorizes specific drilling and plugging activities requiring documentation for each borehole drilled. All documentation is submitted to the RCT on a monthly basis and each borehole drilled under the exploration permit is inspected by an RCT inspector to ensure compliance. As at July 31, 2022, we held one exploration permit in each of Bee, Duval and Goliad Counties in Texas.

As an example of the regulation that guides our industry, before ISR uranium extraction can begin in Texas, a number of permits must be granted by the TCEQ.

A Mine Area Permit (“MAP”) application is required for submission to the TCEQ to establish a specific permit area boundary, aquifer exemption boundary and the mineral zones of interests or production zones. The application also includes a financial surety plan to ensure funding for all plugging and abandonment requirements. Funding for surety is in the form of cash or bonds, including an excess of 15% for contingencies and 10% for overhead, adjusted annually for inflation. As at July 31, 2022, we held MAPs for our Palangana Mine and our Goliad and Burke Hollow Projects.

A Radioactive Material License (“RML”) application is also required for submission to the TCEQ for authorization to operate a uranium recovery facility. The application includes baseline environmental data for soil, vegetation, surface water and groundwater along with operational sampling frequencies and locations. A Radiation Safety Manual is a key component of the application which defines the environmental health and safety programs and procedures to protect employees and the environment. Another important component of the application is a financial surety mechanism to ensure plant and wellfield decommissioning is properly funded and maintained. Surety funding is in the form of cash or bonds, and includes an excess of 15% for contingencies and 10% for overhead, adjusted annually for inflation. As at July 31, 2022, we held RMLs for our Palangana Mine, Burke Hollow and Goliad Projects and Hobson Processing Facility.

PAA applications are also required for submission to the TCEQ to establish specific extraction areas inside the MAP boundary. These are typically 30 to 100-acre units that have been delineated and contain extractible quantities of uranium. The PAA application includes baseline water quality data that is characteristic of that individual unit, proposes upper control limits for monitor well analysis and establishes restoration values. The application will also include a financial security plan for wellfield restoration and reclamation which must be funded and in place prior to commencing uranium extraction. As at July 31, 2022, we held four PAA permits for our Palangana Mine and one for our Goliad Project.

A Class I disposal well permit application is also required for submission to the TCEQ for authorization for deep underground wastewater injection. It is the primary method for disposing of excess fluid from the extraction areas and for reverse osmosis concentrate during the restoration phase. This permit authorizes injection into a specific injection zone within a designated injection interval. The permit requires continuous monitoring of numerous parameters including injection flow rate, injection pressure, annulus pressure and injection/annulus differential pressure.  Mechanical integrity testing is required initially and annually to ensure the well is mechanically sound.  Surety funding for plugging and abandonment of each well is in the form of cash or bonds, including 15% for contingencies and 10% for overhead, adjusted annually for inflation. As at July 31, 2022, we held two Class I disposal well permits for each of our Hobson Processing Facility, Palangana Satellite Facility and Burke Hollow and Goliad Projects.

The federal Safe Drinking Water Act (“SDWA”) creates a regulatory program to protect groundwater and is administered by the EPA. The SDWA allows states to issue underground injection control (“UIC”) permits under two conditions: the state’s program must have been granted primacy; and the EPA must have granted an aquifer exemption upon the state’s request (an “Aquifer Exemption”). Texas, being a primacy state, is therefore authorized to grant UIC permits and makes the official requests for an Aquifer Exemption to the EPA. The Aquifer Exemption request is submitted by the Company to the TCEQ and, once approved, is then submitted by the TCEQ to the EPA for concurrence and final issuance. As at July 31, 2022, we held an Aquifer Exemption for each of our Palangana Mine and our Goliad and Burke Hollow Projects.

Waste Disposal

The Resource Conservation and Recovery Act (“RCRA”) and comparable state statutes affect mineral exploration and production activities by imposing regulations on the generation, transportation, treatment, storage, disposal and cleanup of “hazardous wastes” and on the disposal of non-hazardous wastes. Under the auspices of the EPA, the individual states administer some or all of the provisions of RCRA, sometimes in conjunction with their own, more stringent requirements

Comprehensive Environmental Response, Compensation and Liability Act

The federal Comprehensive Environmental Response, Compensation and Liability Act (“CERCLA”) imposes joint and several liability for costs of investigation and remediation and for natural resource damages, without regard to fault or the legality of the original conduct, on certain classes of persons with respect to the release into the environment of substances designated under CERCLA as hazardous substances (collectively, “Hazardous Substances”). These classes of persons or potentially responsible parties include the current and certain past owners and operators of a facility or property where there is or has been a release or threat of release of a Hazardous Substance and persons who disposed of or arranged for the disposal of the Hazardous Substances found at such a facility. CERCLA also authorizes the EPA and, in some cases, third parties, to take actions in response to threats to the public health or the environment and to seek to recover the costs of such action. We may also in the future become an owner of facilities on which Hazardous Substances have been released by previous owners or operators. We may in the future be responsible under CERCLA for all or part of the costs to clean up facilities or properties at which such substances have been released and for natural resource damages.

Air Emissions

Our operations are subject to local, state and federal regulations for the control of emissions of air pollution.  Major sources of air pollutants are subject to more stringent, federally imposed permitting requirements. Administrative enforcement actions for failure to comply strictly with air pollution regulations or permits are generally resolved by payment of monetary fines and correction of any identified deficiencies. Alternatively, regulatory agencies could require us to forego construction, modification or operation of certain air emission sources. In Texas the TCEQ issues an exemption for those processes that meet the criteria for low to zero emission by issuing a permit by rule. Presently our Palangana Mine, our Hobson Processing Facility and our Goliad Project all have permits by rule covering air emissions.

Water Management

UEC commits its management team, employees and contractors to be good stewards of the water it utilizes in all parts of its operations. From exploration to restoration, water is the critical factor for ISR mining and responsibly managing that water is crucial to our business.

At all UEC’s ISR projects the ore hosted groundwater does not meet either primary or secondary drinking water standards and should only be used for industrial or agricultural use without proper treatment.

Water consumption at UEC’s ISR mining projects is primarily natural groundwater. During the recovery process, water is pumped from the ore hosted aquifer and piped to the satellite facility. The groundwater is filtered for solids, stripped of uranium, allowed to settle and then approximately 95% is reinjected or recirculated back into the same aquifer it was recovered from. This recycling process is an overwhelming advantage of ISR mining compared to other methods such as conventional or open pit.

In order to ensure appropriate water management, and to ensure our team can continuously make decisions to reduce our water usage, UEC closely monitors our water consumption. UEC is identifying ways to reduce water consumption on an ongoing basis.

Compliance with the Clean Water Act

The Clean Water Act (“CWA”) imposes restrictions and strict controls regarding the discharge of wastes, including mineral processing wastes, into waters of the U.S., a term broadly defined. Permits must be obtained to discharge pollutants into federal waters. The CWA provides for civil, criminal and administrative penalties for unauthorized discharges of hazardous substances and other pollutants. It imposes substantial potential liability for the costs of removal or remediation associated with discharges of oil or hazardous substances. State laws governing discharges to water also provide varying civil, criminal and administrative penalties and impose liabilities in the case of a discharge of petroleum or its derivatives, or other hazardous substances, into state waters. In addition, the EPA has promulgated regulations that may require us to obtain permits to discharge storm water runoff. Management believes that we are in substantial compliance with current applicable environmental laws and regulations.

GHG Emissions Management

Mining is an essential industry to enable the global transition to net-zero. Uranium mining, at the heart of UEC’s business, fuels nuclear energy, which is an essential carbon-free energy source. Beyond this, we understand that our operational activities do contribute to climate change through the release of emissions. Therefore, over the next several years, we will begin a process to understand our emissions profile, as well as identify and implement opportunities to reduce emissions, where and when possible.

We have created an emissions inventory of all sources (mobile and stationary) for each Texas project and we have initiated fuel consumption tracking by individual source at each project. We have created tracking mechanisms for all Scope 1 and 2 emissions for our Texas projects, which includes fuel consumption and mileage for the Texas fleet and stationary sources as well as electrical energy consumption at each Texas project. Scope 1 emissions covers direct emissions from owned or controlled sources. Scope 2 emissions covers indirect emissions from the generation of purchased electricity, steam, heating and cooling consumed by the Company.

Through developing this inventory, we have been able to identify, assess and conduct a cost benefit analysis for emission reduction opportunities at UEC’s Texas projects. Such opportunities include exploring ways to upgrade our Hobson plant into a zero-emissions processing plant. 

Aligned to responsibly managing our emissions in the short-term, we have purchased carbon offset credits for our Scope 1 and 2 emissions for our Texas sites.

Health and Safety

Health and safety is one of our top priorities. We pride ourselves on employing safe practices in all aspects of its work.

In Fiscal 2022, UEC’s Board approved an Environmental, Health and Safety Policy that provides overall objectives and guidance for our health and safety management. Supporting this Policy, at each site, UEC has a number of operational policies and practices covering radiation safety and procedures, spills and leakage reporting, equipment training and emergency response procedures. There is also a company-wide Injury and Incident Policy covered in the employee handbook that all employees are familiar with and are required to comply against.

Training for employees on health and safety protocols are essential to ensuring we employ best safety practices at all times. Although exact training hours have not been recorded for this fiscal year, UEC has provided training to staff on a variety of safety topics, including, but not limited to, the following topics:

UEC’s health and safety practices are developed to ensure that all regulatory requirements are met. Across all of our sites, our employees are required to report all injuries to their supervisor. On an annual basis, all reports are analyzed and tracked as required by the Occupational Health and Safety Association (“OSHA”). Given the nature of UEC’s specialized industry, there are site-specific emergency procedures in place that identify the steps employees should take in the event of a health and safety emergency.

Competition

The uranium industry is highly competitive, and our competition includes larger, more established companies with longer operating histories that not only explore for and produce uranium but also market uranium and other products on a regional, national or worldwide basis. Due to their greater financial and technical resources, we may not be able to acquire additional uranium projects in a competitive bidding process involving such companies. Additionally, these larger companies have greater resources to continue with their operations during periods of depressed market conditions.

The global titanium market is highly competitive, with the top six producers accounting for approximately 60% of the world’s production capacity according to TZ Minerals International Pty. Ltd. Competition is based on a number of factors, such as price, product quality and service. Among our competitors are companies that are vertically-integrated (those that have their own raw material resources).

Research and Development Activities

No research and development expenditures have been incurred, either on our account or sponsored by customers, for our three most recently completed fiscal years.

Employees

Amir Adnani is our President and Chief Executive Officer and, effective October 29, 2015, Pat Obara was appointed our Chief Financial Officer. These individuals are primarily responsible for all our day-to-day operations. Effective September 8, 2014, Scott Melbye was appointed our Executive Vice President. Other services are provided by outsourcing and consulting and special purpose contracts. As of July 31, 2022, we had 63 persons employed on a full-time basis and four individuals providing services on a contractual basis.

Human Capital

As of July 31, 2022, our employee population consisted of 63 individuals working for us and our consolidated subsidiaries, 38 of whom were located in the United States, 13 in Canada and 12 in Paraguay. Our Company is committed to attracting and retaining talented and experienced individuals to manage and support our operations.  We engage in a variety of learning and development opportunities with our employees, including ongoing training, continuing education courses, workshops and seminars and membership in professional organizations relating to employees’ projects areas of expertise. We strive to fill employment openings through internal promotions or transfers of qualified employees, as appropriate.

Available Information

The Company’s website address is www.uraniumenergy.com and our annual reports on Form 10-K and quarterly reports on Form 10-Q, and amendments to such reports, are available free of charge on our website as soon as reasonably practicable after such materials are filed or furnished electronically with the SEC. These same reports, as well as our current reports on Form 8-K, and amendments to those reports, filed or furnished electronically with the SEC are available for review at the SEC’s website at www.sec.gov. Printed copies of the foregoing materials are available free of charge upon written request by email at info@uraniumenergy.com. Additional information about the Company can be found on our website, however, such information is neither incorporated by reference nor included as part of this or any other report or information filed with or furnished to the SEC.

Item 1A. Risk Factors

In addition to the information contained in this Form 10-K Annual Report, we have identified the following material risks and uncertainties which reflect our outlook and conditions known to us as of the date of this Annual Report. These material risks and uncertainties should be carefully reviewed by our stockholders and any potential investors in evaluating the Company, our business and the market value of our common stock. Furthermore, any one of these material risks and uncertainties has the potential to cause actual results, performance, achievements or events to be materially different from any future results, performance, achievements or events implied, suggested or expressed by any forward-looking statements made by us or by persons acting on our behalf. Refer to “Cautionary Note Regarding Forward-looking Statements”.

There is no assurance that we will be successful in preventing the material adverse effects that any one or more of the following material risks and uncertainties may cause on our business, prospects, financial condition and operating results, which may result in a significant decrease in the market price of our common stock. Furthermore, there is no assurance that these material risks and uncertainties represent a complete list of the material risks and uncertainties facing us. There may be additional risks and uncertainties of a material nature that, as of the date of this Annual Report, we are unaware of or that we consider immaterial that may become material in the future, any one or more of which may result in a material adverse effect on us. You could lose all or a significant portion of your investment due to any one of these material risks and uncertainties.

Risks Related to Our Company and Business

Evaluating our future performance may be difficult since we have a limited financial and operating history, with significant negative operating cash flow and an accumulated deficit to date. Our long-term success will depend ultimately on our ability to achieve and maintain profitability and to develop positive cash flow from our mining activities.

As more fully described under Item 1. Business herein, Uranium Energy Corp. was incorporated under the laws of the State of Nevada on May 16, 2003 and, since 2004, we have been engaged in uranium mining and related activities, including exploration, pre-extraction, extraction and processing, on projects located in the United States, Canada and the Republic of Paraguay. In November 2010, we commenced uranium extraction for the first time at our Palangana Mine utilizing ISR methods and processed those materials at our Hobson Processing Facility into drums of U₃O₈. We also hold uranium projects in various stages of exploration and pre-extraction in the States of Arizona, Colorado, New Mexico, Texas and Wyoming, in Canada and the Republic of Paraguay. Since we completed the acquisition of our Alto Paraná Project located in the Republic of Paraguay in July 2017, we are also involved in mining and related activities, including exploration, pre-extraction, extraction and processing, of titanium minerals.

As more fully described under “Liquidity and Capital Resources” of Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations herein, we have a history of significant negative cash flow and net losses, with an accumulated deficit balance of $286.4 million as at July 31, 2022. Historically, we have been reliant primarily on equity financings from the sale of our common stock and on debt financing in order to fund our operations. Although we generated revenues from sales of U₃O₈ we extracted during Fiscal 2015, Fiscal 2013 and Fiscal 2012 of $3.1 million, $9.0 million and $13.8 million, respectively, and generated revenues from sales of purchased uranium inventory and toll processing services totaling 23.2 million during Fiscal 2022, we have yet to achieve profitability or develop positive cash flow from our operations, and we do not expect to achieve profitability or develop positive cash flow from operations in the near term. As a result of our limited financial and operating history, including our significant negative cash flow from operations and net losses to date, it may be difficult to evaluate our future performance.

As at July 31, 2022, we had a working capital (current assets less current liabilities) of $93.7 million including cash and cash equivalents of $32.5 million and uranium inventory holdings of $66.2 million. Subsequent to July 31, 2022, we received additional cash proceeds of $14.8 million under our at-the-market offerings (the “2021 ATM Offerings”). We believe that our existing cash resources and, if necessary, cash generated from the sale of the Company’s liquid assets, will provide sufficient funds to carry out our planned operations for 12 months from the date of this Annual Report. Our continuation as a going concern for a period beyond those 12 months will be dependent upon our ability to obtain adequate additional financing, as our operations are capital intensive and future capital expenditures are expected to be substantial. Our continued operations, including the recoverability of the carrying values of our assets, are dependent ultimately on our ability to achieve and maintain profitability and positive cash flow from our operations.

Our reliance on equity and debt financings is expected to continue for the foreseeable future, and their availability whenever such additional financing is required will be dependent on many factors beyond our control including, but not limited to, the market price of uranium, the continuing public support of nuclear power as a viable source of electrical generation, the volatility in the global financial markets affecting our stock price and the status of the worldwide economy, any one of which may cause significant challenges in our ability to access additional financing, including access to the equity and credit markets. We may also be required to seek other forms of financing, such as asset divestitures or joint venture arrangements, to continue advancing our projects which would depend entirely on finding a suitable third party willing to enter into such an arrangement, typically involving an assignment of a percentage interest in the mineral project.

Our long-term success, including the recoverability of the carrying values of our assets and our ability to acquire additional uranium projects and continue with exploration and pre-extraction activities and mining activities on our existing uranium projects, will depend ultimately on our ability to achieve and maintain profitability and positive cash flow from our operations by establishing ore bodies that contain commercially recoverable uranium and to develop these into profitable mining activities. The economic viability of our mining activities, including the expected duration and profitability of our ISR Mines and of any future satellite ISR mines, such as our Burke Hollow and Goliad Projects located within the South Texas Uranium Belt, our Christensen Ranch Mine and Reno Creek Project located in the Powder River Basin, Wyoming, and our projects in Canada and in the Republic of Paraguay, have many risks and uncertainties. These include, but are not limited to: (i) a significant, prolonged decrease in the market price of uranium and titanium minerals; (ii) difficulty in marketing and/or selling uranium concentrates; (iii) significantly higher than expected capital costs to construct a mine and/or processing plant; (iv) significantly higher than expected extraction costs; (v) significantly lower than expected mineral extraction; (vi) significant delays, reductions or stoppages of uranium extraction activities; and (vii) the introduction of significantly more stringent regulatory laws and regulations. Our mining activities may change as a result of any one or more of these risks and uncertainties and there is no assurance that any ore body that we extract mineralized materials from will result in achieving and maintaining profitability and developing positive cash flow.

Our operations are capital intensive, and we will require significant additional financing to acquire additional mineral projects and continue with our exploration and pre-extraction activities on our existing projects.

Our operations are capital intensive and future capital expenditures are expected to be substantial. We will require significant additional financing to fund our operations, including acquiring additional mineral projects and continuing with our exploration and pre-extraction activities which include assaying, drilling, geological and geochemical analysis and mine construction costs. In the absence of such additional financing we would not be able to fund our operations or continue with our exploration and pre-extraction activities, which may result in delays, curtailment or abandonment of any one or all of our projects.

Our uranium extraction and sales history is limited. Our ability to generate revenue is subject to a number of factors, any one or more of which may adversely affect our financial condition and operating results.

We have a limited history of uranium extraction and generating revenue.  In November 2010, we commenced uranium extraction at our Palangana Mine, which has been our sole source of revenues from the sales of produced U₃O₈ during Fiscal 2015, Fiscal 2013 and Fiscal 2012, with no revenues from sales of produced U₃O₈ during other fiscal years.

During Fiscal 2022, we continued to operate our ISR Mines at a reduced pace to align our operations to a weak uranium commodity market in a challenging post-Fukushima environment. This strategy has included the deferral of major pre-extraction expenditures and remaining in a state of operational readiness in anticipation of a recovery in uranium prices. Our ability to generate revenue from our Palangana and recently acquired Christensen Ranch Mines is subject to a number of factors which include, but are not limited to: (i) a significant, prolonged decrease in the market price of uranium; (ii) difficulty in marketing and/or selling uranium concentrates; (iii) significantly higher than expected extraction costs; (iv) significantly lower than expected uranium extraction; (v) significant delays, reductions or stoppages of uranium extraction activities; and (vi) the introduction of significantly more stringent regulatory laws and regulations. Furthermore, continued mining activities at our ISR Mines will eventually deplete the mines or cause such activities to become uneconomical, and if we are unable to directly acquire or develop existing uranium projects, such as our Moore Ranch, Reno Creek, Burke Hollow and Goliad Projects, into additional uranium mines from which we can commence uranium extraction, it will negatively impact our ability to generate revenues. Any one or more of these occurrences may adversely affect our financial condition and operating results.

Exploration and pre-extraction programs and mining activities are inherently subject to numerous significant risks and uncertainties, and actual results may differ significantly from expectations or anticipated amounts. Furthermore, exploration programs conducted on our projects may not result in the establishment of ore bodies that contain commercially recoverable uranium.

Exploration and pre-extraction programs and mining activities are inherently subject to numerous significant risks and uncertainties, with many beyond our control and including, but not limited to: (i) unanticipated ground and water conditions and adverse claims to water rights; (ii) unusual or unexpected geological formations; (iii) metallurgical and other processing problems; (iv) the occurrence of unusual weather or operating conditions and other force majeure events; (v) lower than expected ore grades; (vi) industrial accidents; (vii) delays in the receipt of or failure to receive necessary government permits; (viii) delays in transportation; (ix) availability of contractors and labor; (x) government permit restrictions and regulation restrictions; (xi) unavailability of materials and equipment; and (xii) the failure of equipment or processes to operate in accordance with specifications or expectations. These risks and uncertainties could result in: (i) delays, reductions or stoppages in our mining activities; (ii) increased capital and/or extraction costs; (iii) damage to, or destruction of, our mineral projects, extraction facilities or other properties; (iv) personal injuries; (v) environmental damage; (vi) monetary losses; and (vii) legal claims.

Success in mineral exploration is dependent on many factors including, without limitation, the experience and capabilities of a company’s management, the availability of geological expertise and the availability of sufficient funds to conduct the exploration program. Even if an exploration program is successful and commercially recoverable material is established, it may take a number of years from the initial phases of drilling and identification of the mineralization until extraction is possible, during which time the economic feasibility of extraction may change such that the material ceases to be economically recoverable. Exploration is frequently non-productive due, for example, to poor exploration results or the inability to establish ore bodies that contain commercially recoverable material, in which case the project may be abandoned and written-off. Furthermore, we will not be able to benefit from our exploration efforts and recover the expenditures that we incur on our exploration programs if we do not establish ore bodies that contain commercially recoverable material and develop these projects into profitable mining activities, and there is no assurance that we will be successful in doing so for any of our projects.

Whether an ore body contains commercially recoverable material depends on many factors including, without limitation: (i) the particular attributes, including material changes to those attributes, of the ore body such as size, grade, recovery rates and proximity to infrastructure; (ii) the market price of uranium, which may be volatile; and (iii) government regulations and regulatory requirements including, without limitation, those relating to environmental protection, permitting and land use, taxes, land tenure and transportation.

We have not established proven or probable reserves through the completion of a “final” or “bankable” feasibility study for any of our projects, including our ISR Mines. Furthermore, we have no plans to establish proven or probable reserves for any of our uranium projects for which we plan on utilizing ISR mining, such as our ISR Mines. Since we commenced extraction of mineralized materials from our ISR Mines without having established proven or probable reserves, it may result in our mining activities at our ISR Mines, and at any future projects for which proven or probable reserves are not established, being inherently riskier than other mining activities for which proven or probable reserves have been established.

We have established the existence of mineralized materials for certain of our projects, including our ISR Mines. We have not established proven or probable reserves, as defined by the SEC, through the completion of a “final” or “bankable” feasibility study for any of our projects, including our ISR Mines. Furthermore, we have no plans to establish proven or probable reserves for any of our projects for which we plan on utilizing ISR mining. Since we commenced the extraction of mineralized materials at our ISR Mines without having established proven or probable reserves, there may be greater inherent uncertainty as to whether or not any mineralized material can be economically extracted as originally planned and anticipated. Any mineralized materials established or extracted from our ISR Mines should not in any way be associated with having established or produced from proven or probable reserves.

On October 31, 2018, the SEC adopted the Modernization of Property Disclosures for Mining Registrants (again, the New Rule), introducing significant changes to the existing mining disclosure framework to better align it with international industry and regulatory practice, including NI 43-101. The New Rule became effective as of February 25, 2019, and issuers are required to comply with the New Rule as of the annual report for their first fiscal year beginning on or after January 1, 2021, and earlier in certain circumstances. The Company believes that it is presently in compliance with the New Rule.

Since we are in the Exploration Stage, pre-production expenditures including those related to pre-extraction activities are expensed as incurred, the effects of which may result in our consolidated financial statements not being directly comparable to the financial statements of companies in the Production Stage.

Despite the fact that we commenced uranium extraction at our ISR Mines, we remain in the Exploration Stage (as defined by the SEC) and will continue to remain in the Exploration Stage until such time as proven or probable reserves have been established, which may never occur. We prepare our consolidated financial statements in accordance with United States generally accepted accounting principles (“U.S. GAAP”) under which acquisition costs of mineral rights are initially capitalized as incurred while pre-production expenditures are expensed as incurred until such time as we exit the Exploration Stage. Expenditures relating to exploration activities are expensed as incurred and expenditures relating to pre-extraction activities are expensed as incurred until such time as proven or probable reserves are established for that uranium project, after which subsequent expenditures relating to mine development activities for that particular project are capitalized as incurred.

We have neither established nor have any plans to establish proven or probable reserves for our uranium projects for which we plan on utilizing ISR mining. Companies in the Production Stage, (as defined by the SEC), having established proven and probable reserves and exited the Exploration Stage, typically capitalize expenditures relating to ongoing development activities, with corresponding depletion calculated over proven and probable reserves using the units-of-production method and allocated to inventory and, as that inventory is sold, to cost of goods sold. As we are in the Exploration Stage, it has resulted in us reporting larger losses than if we had been in the Production Stage due to the expensing, instead of capitalization, of expenditures relating to ongoing processing facility and mine pre-extraction activities. Additionally, there would be no corresponding amortization allocated to our future reporting periods since those costs would have been expensed previously, resulting in both lower inventory costs and cost of goods sold and results of operations with higher gross profits and lower losses than if we had been in the Production Stage. Any capitalized costs, such as acquisition costs of mineral rights, are depleted over the estimated extraction life using the straight-line method. As a result, our consolidated financial statements may not be directly comparable to the financial statements of companies in the Production Stage.

Estimated costs of future reclamation obligations may be significantly exceeded by actual costs incurred in the future. Furthermore, only a portion of the financial assurance required for the future reclamation obligations has been funded.

We are responsible for certain remediation and decommissioning activities in the future, primarily for our Hobson Processing Facility, our Palangana Mine and our recently acquired Christensen Ranch Mine and Irigary Processing Facility, and have recorded a liability of $17.3 million on our balance sheet at July 31, 2022, to recognize the present value of the estimated costs of such reclamation obligations. Should the actual costs to fulfill these future reclamation obligations materially exceed these estimated costs, it may have an adverse effect on our financial condition and operating results, including not having the financial resources required to fulfill such obligations when required to do so.

During Fiscal 2015, we secured $5.6 million of surety bonds as an alternate source of financial assurance for the estimated costs of the reclamation obligations of our Hobson Processing Facility and Palangana Mine, of which we have $1.7 million funded and held as restricted cash for collateral purposes as required by the surety. In connection with the U1A Acquisition, we assumed $13.7 million of restricted cash as surety bond collateral for total estimated reclamation costs of $18.6 million for the Christensen Ranch Mine and Irigaray Processing Facility. During Fiscal 2020, $8.6 million of surety bond collateral related to the Christensen Ranch Mine and Irigaray Processing Facility was released. We may be required at any time to fund the remaining $17.4 million or any portion thereof for a number of reasons including, but not limited to, the following: (i) the terms of the surety bonds are amended, such as an increase in collateral requirements; (ii) we are in default with the terms of the surety bonds; (iii) the surety bonds are no longer acceptable as an alternate source of financial assurance by the regulatory authorities; or (iv) the surety encounters financial difficulties. Should any one or more of these events occur in the future, we may not have the financial resources to fund the remaining amount or any portion thereof when required to do so.

We cannot provide any assurance that our Physical Uranium Program involving the strategic acquisition of physical uranium will be successful, which may have an adverse effect on our results of operations.

We have used or allocated a large portion of our cash on hand in order to fund the acquisition of drummed uranium. This strategy will be subject to a number of risks and there is no assurance that the strategy will be successful. Future deliveries are subject to performance by other parties and there is a possibility of default by those parties, thus depriving us of potential benefits.

Due to the fluctuation of uranium prices, the price of uranium will fluctuate and we will be subject to losses should we ultimately determine to sell the uranium at prices lower than the acquisition cost. The primary risks associated with physical uranium will be the normal risks associated with supply and demand fundamentals affecting price movements.

We may be required to sell a portion or all of the physical uranium accumulated to fund our operations should other forms of financing not be available to meet our capital requirements.

Since there is no public market for uranium, selling the uranium may take extended periods of time and suitable purchasers may be difficult to find, which could have a material adverse effect on our financial condition and may have a material adverse effect on our securities.

There is no public market for the sale of uranium, although there are several trading and brokerage houses that serve the industry with bid and ask data as well as locations and quantities. The uranium futures market on the New York Mercantile Exchange does not provide for physical delivery of uranium, only cash on settlement, and that trading forum does not offer a formal market but rather facilitates the introduction of buyers to sellers.

The pool of potential purchasers and sellers is limited, and each transaction may require the negotiation of specific provisions. Accordingly, a sale may take several weeks or months to complete. If we determine to sell any physical uranium that we have acquired, we may likewise experience difficulties in finding purchasers that are able to accept a material quantity of physical uranium at a price and at a location that is compatible with our interests. The inability to sell on a timely basis in sufficient quantities and at a desired price and location could have a material adverse effect on our securities.

As part of our Physical Uranium Program, we have entered into commitments to purchase U₃O₈ and may purchase additional quantities. There is no certainty that any future purchases contemplated by us will be completed.

Storage arrangements, including the extension of storage arrangements, along with credit and operational risks of uranium storage facilities, may result in the loss or damage of our physical uranium which may not be covered by insurance or indemnity provisions and could have a material adverse effect on our financial condition.

Currently, the uranium we purchased will be stored at the licensed uranium conversion facility of ConverDyn owned by Honeywell. There can be no assurance that storage arrangements that have been negotiated will be extended indefinitely, forcing actions or costs not currently contemplated. Failure to negotiate commercially reasonable storage terms for a subsequent storage period with ConverDyn may have a material adverse effect on our financial condition.

By holding our uranium inventory at the ConverDyn conversion facility we are exposed to the credit and operational risks of the facility. There is no guarantee that we can fully recover all of our investment in uranium held with the facility in the event of a disruptive event. Failure to recover all uranium holdings could have a material adverse effect on our financial condition. Any loss or damage of the uranium may not be fully covered or absolved by contractual arrangements with ConverDyn or our insurance arrangements, and we may be financially and legally responsible for losses and/or damages not covered by indemnity provisions or insurance. Such responsibility could have a material adverse effect on our financial condition.

The uranium industry is subject to influential political and regulatory factors which could have a material adverse effect on our business and financial condition.

The international uranium industry, including the supply of uranium concentrates, is relatively small, competitive and heavily regulated. Worldwide demand for uranium is directly tied to the demand for electricity produced by the nuclear power industry, which is also subject to extensive government regulation and policies. In addition, the international marketing and trade of uranium is subject to political changes in governmental policies, regulatory requirements and international trade restrictions (including trade agreements, customs, duties and/or taxes). International agreements, governmental policies and trade restrictions are beyond our control. Changes in regulatory requirements, customs, duties or taxes may affect the availability of uranium, which could have a material adverse effect on our business and financial condition.

We do not insure against all of the risks we face in our operations.

In general, where coverage is available and not prohibitively expensive relative to the perceived risk, we will maintain insurance against such risk, subject to exclusions and limitations. We currently maintain insurance against certain risks, including securities and general commercial liability claims and certain physical assets used in our operations, subject to exclusions and limitations, however, we do not maintain insurance to cover all of the potential risks and hazards associated with our operations. We may be subject to liability for environmental, pollution or other hazards associated with our exploration, pre-extraction and extraction activities, which we may not be insured against, which may exceed the limits of our insurance coverage or which we may elect not to insure against because of high premiums or other reasons. Furthermore, we cannot provide assurance that any insurance coverage we currently have will continue to be available at reasonable premiums or that such insurance will adequately cover any resulting liability.

Acquisitions that we may make from time to time could have an adverse impact on us.

From time to time we examine opportunities to acquire additional mining assets and businesses. Any acquisition that we may choose to complete may be of a significant size, may change the scale of our business and operations and may expose us to new geographic, political, operating, financial and geological risks. Our success in our acquisition activities depends on our ability to identify suitable acquisition candidates, negotiate acceptable terms for any such acquisition and integrate the acquired operations successfully with those of our Company. Any acquisitions would be accompanied by risks which could have a material adverse effect on our business. For example: (i) there may be a significant change in commodity prices after we have committed to complete the transaction and established the purchase price or exchange ratio; (ii) a material ore body may prove to be below expectations; (iii) we may have difficulty integrating and assimilating the operations and personnel of any acquired companies, realizing anticipated synergies and maximizing the financial and strategic position of the combined enterprise and maintaining uniform standards, policies and controls across the organization; (iv) the integration of the acquired business or assets may disrupt our ongoing business and our relationships with employees, customers, suppliers and contractors; and (v) the acquired business or assets may have unknown liabilities which may be significant. In the event that we choose to raise debt capital to finance any such acquisition, our leverage will be increased. If we choose to use equity as consideration for such acquisition, existing shareholders may suffer dilution. Alternatively, we may choose to finance any such acquisition with our existing resources. There can be no assurance that we would be successful in overcoming these risks or any other problems encountered in connection with such acquisitions.

The uranium and titanium industries are subject to numerous stringent laws, regulations and standards, including environmental protection laws and regulations If any changes occur that would make these laws, regulations and standards more stringent, it may require capital outlays in excess of those anticipated or cause substantial delays, which would have a material adverse effect on our operations.

Uranium and titanium exploration and pre-extraction programs and mining activities are subject to numerous stringent laws, regulations and standards at the federal, state and local levels governing permitting, pre-extraction, extraction, exports, taxes, labor standards, occupational health, waste disposal, protection and reclamation of the environment, protection of endangered and protected species, mine safety, hazardous substances and other matters. Our compliance with these requirements requires significant financial and personnel resources.

The laws, regulations, policies or current administrative practices of any government body, organization or regulatory agency in the United States, or any other applicable jurisdiction, may change or be applied or interpreted in a manner which may also have a material adverse effect on our operations. The actions, policies or regulations, or changes thereto, of any government body or regulatory agency or special interest group may also have a material adverse effect on our operations.

Uranium and titanium exploration and pre-extraction programs and mining activities are subject to stringent environmental protection laws and regulations at the federal, state and local levels. These laws and regulations include permitting and reclamation requirements, regulate emissions, water storage and discharges and disposal of hazardous wastes. Uranium mining activities are also subject to laws and regulations which seek to maintain health and safety standards by regulating the design and use of mining methods. Various permits from governmental and regulatory bodies are required for mining to commence or continue, and no assurance can be provided that required permits will be received in a timely manner.

Our compliance costs, including the posting of surety bonds associated with environmental protection laws and regulations and health and safety standards, have been significant to date, and are expected to increase in scale and scope as we expand our operations in the future. Furthermore, environmental protection laws and regulations may become more stringent in the future, and compliance with such changes may require capital outlays in excess of those anticipated or cause substantial delays, which would have a material adverse effect on our operations.

While the very heart of our business – uranium extraction, which is the fuel for carbon-free, emission-free baseload nuclear power – and our recycling programs, help address global climate change and reduce air pollution, the world’s focus on addressing climate change will require the Company to continue to conduct all of its operations in a manner that minimizes the use of resources, including the unnecessary use of energy resources, in order to continue to minimize air emissions at our facilities, which can also increase mine and facility, construction, development and operating costs. Regulatory and environmental standards may also change over time to address global climate change, which could further increase these costs.

To the best of our knowledge, our operations are in compliance, in all material respects, with all applicable laws, regulations and standards. If we become subject to liability for any violations, we may not be able or may elect not to insure against such risk due to high insurance premiums or other reasons. Where coverage is available and not prohibitively expensive relative to the perceived risk, we will maintain insurance against such risk, subject to exclusions and limitations. However, we cannot provide any assurance that such insurance will continue to be available at reasonable premiums or that such insurance will be adequate to cover any resulting liability.

We may not be able to obtain, maintain or amend rights, authorizations, licenses, permits or consents required for our operations.

Our exploration and mining activities are dependent upon the grant of appropriate rights, authorizations, licences, permits and consents, as well as continuation and amendment of these rights, authorizations, licences, permits and consents already granted, which may be granted for a defined period of time, or may not be granted or may be withdrawn or made subject to limitations. There can be no assurance that all necessary rights, authorizations, licences, permits and consents will be granted to us, or that authorizations, licences, permits and consents already granted will not be withdrawn or made subject to limitations.

Major nuclear and global market incidents may have adverse effects on the nuclear and uranium industries.

The nuclear incident that occurred in Japan in March 2011 had significant and adverse effects on both the nuclear and uranium industries. If another nuclear incident were to occur, it may have further adverse effects for both industries. Public opinion of nuclear power as a source of electrical generation may be adversely affected, which may cause governments of certain countries to further increase regulation for the nuclear industry, reduce or abandon current reliance on nuclear power or reduce or abandon existing plans for nuclear power expansion. Any one of these occurrences has the potential to reduce current and/or future demand for nuclear power, resulting in lower demand for uranium and lower market prices for uranium, adversely affecting the operations and prospects of our Company. Furthermore, the growth of the nuclear and uranium industries is dependent on continuing and growing public support of nuclear power as a viable source of electrical generation.

In March 2020 the COVID-19 pandemic resulted in a black swan event impacting about 50% of the world’s uranium production and has accelerated the market rebalancing. In 2020 significant production cuts were announced in response to the global COVID-19 pandemic, including uranium facilities in Canada, Kazakhstan and Namibia. In 2022, although most production impacted by COVID-19 has returned to an operating status, some production has continued to be affected. It is unknown at this time exactly how long all the impacts will last or how much uranium production will ultimately be removed from the market as a result of the COVID-19 pandemic. The Company also believes that a large degree of uncertainty exists in the market, primarily due to the size of mobile uranium inventories, transportation issues, premature reactor shutdowns in the U.S. and the length of time of any uranium mine, conversion or enrichment facility shutdowns.

The marketability of uranium concentrates will be affected by numerous factors beyond our control which may result in our inability to receive an adequate return on our invested capital.

The marketability of uranium concentrates extracted by us will be affected by numerous factors beyond our control. These factors include: (i) macroeconomic factors; (ii) fluctuations in the market price of uranium; (iii) governmental regulations; (iv) land tenure and use; (v) regulations concerning the importing and exporting of uranium; and (vi) environmental protection regulations. The future effects of these factors cannot be accurately predicted, but any one or a combination of these factors may result in our inability to receive an adequate return on our invested capital.

The titanium industry is affected by global economic factors, including risks associated with volatile economic conditions, and the market for many titanium products is cyclical and volatile, and we may experience depressed market conditions for such products.

Titanium is used in many “quality of life” products for which demand historically has been linked to global, regional and local GDP and discretionary spending, which can be negatively impacted by regional and world events or economic conditions. Such events are likely to cause a decrease in demand for products and, as a result, may have an adverse effect on our results of operations and financial condition. The timing and extent of any changes to currently prevailing market conditions is uncertain, and supply and demand may be unbalanced at any time. Uncertain economic conditions and market instability make it particularly difficult for us to forecast demand trends. As a consequence, we may not be able to accurately predict future economic conditions or the effect of such conditions on our financial condition or results of operations. We can give no assurances as to the timing, extent or duration of the current or future economic cycles impacting the industries in which we operate.

Historically, the market for large volume titanium applications, including coatings, paper and plastics, has experienced alternating periods of tight supply, causing prices and margins to increase, followed by periods of lower capacity utilization, resulting in declining prices and margins. The volatility this market experiences occurs as a result of significant changes in the demand for products as a consequence of global economic activity and changes in customers’ requirements. The supply-demand balance is also impacted by capacity additions or reductions that result in changes of utilization rates. In addition, titanium margins are impacted by significant changes in major input costs, such as energy and feedstock. Demand for titanium depends in part on the housing and construction industries. These industries are cyclical in nature and have historically been impacted by downturns in the economy. In addition, pricing may affect customer inventory levels as customers may from time to time accelerate purchases of titanium in advance of anticipated price increases or defer purchases of titanium in advance of anticipated price decreases. The cyclicality and volatility of the titanium industry results in significant fluctuations in profits and cash flow from period to period and over the business cycle.

The uranium industry is highly competitive and we may not be successful in acquiring additional projects.

The uranium industry is highly competitive, and our competition includes larger, more established companies with longer operating histories that not only explore for and produce uranium, but also market uranium and other products on a regional, national or worldwide basis. Due to their greater financial and technical resources, we may not be able to acquire additional uranium projects in a competitive bidding process involving such companies. Additionally, these larger companies have greater resources to continue with their operations during periods of depressed market conditions.

The titanium industry is concentrated and highly competitive, and we may not be able to compete effectively with our competitors that have greater financial resources or those that are vertically integrated, which could have a material adverse effect on our business, results of operations and financial condition.

The global titanium market is highly competitive, with the top six producers accounting for approximately 60% of the world’s production capacity. Competition is based on a number of factors, such as price, product quality and service. Among our competitors are companies that are vertically-integrated (those that have their own raw material resources). Changes in the competitive landscape could make it difficult for us to retain our competitive position in various products and markets throughout the world. Our competitors with their own raw material resources may have a competitive advantage during periods of higher raw material prices. In addition, some of the companies with whom we compete may be able to produce products more economically than we can. Furthermore, some of our competitors have greater financial resources, which may enable them to invest significant capital into their businesses, including expenditures for research and development.

We hold mineral rights in foreign jurisdictions which could be subject to additional risks due to political, taxation, economic and cultural factors.

We hold certain mineral rights located in the Republic of Paraguay through Piedra Rica Mining S.A., Transandes Paraguay S.A., Trier S.A. and Metalicos Y No Metalicos S.R.L., which are incorporated in Paraguay. Operations in foreign jurisdictions outside of the United States and Canada, especially in developing countries, may be subject to additional risks as they may have different political, regulatory, taxation, economic and cultural environments that may adversely affect the value or continued viability of our rights. These additional risks include, but are not limited to: (i) changes in governments or senior government officials; (ii) changes to existing laws or policies on foreign investments, environmental protection, mining and ownership of mineral interests; (iii) renegotiation, cancellation, expropriation and nationalization of existing permits or contracts; (iv) foreign currency controls and fluctuations; and (v) civil disturbances, terrorism and war.

In the event of a dispute arising at our foreign operations in Paraguay, we may be subject to the exclusive jurisdiction of foreign courts or may not be successful in subjecting foreign persons to the jurisdiction of the courts in the United States or Canada. We may also be hindered or prevented from enforcing our rights with respect to a government entity or instrumentality because of the doctrine of sovereign immunity. Any adverse or arbitrary decision of a foreign court may have a material and adverse impact on our business, prospects, financial condition and results of operations.

The title to our mineral property interests may be challenged.

Although we have taken reasonable measures to ensure proper title to our interests in mineral properties and other assets, there is no guarantee that the title to any of such interests will not be challenged. No assurance can be given that we will be able to secure the grant or the renewal of existing mineral rights and tenures on terms satisfactory to us, or that governments in the jurisdictions in which we operate will not revoke or significantly alter such rights or tenures or that such rights or tenures will not be challenged or impugned by third parties, including local governments, aboriginal peoples or other claimants. The Company has had communications and filings with the MOPC, whereby the MOPC is taking the position that certain concessions forming part of the Company’s Yuty and Alto Paraná Projects are not eligible for extension as to exploration or continuation to exploitation in their current stages. While we remain fully committed to our development path forward in Paraguay, we have filed certain applications and appeals in Paraguay to reverse the MOPC’s position in order to protect the Company’s continuing rights in those concessions.  Our mineral properties may be subject to prior unregistered agreements, transfers or claims, and title may be affected by, among other things, undetected defects. A successful challenge to the precise area and location of our claims could result in us being unable to operate on our properties as permitted or being unable to enforce our rights with respect to our properties.

Due to the nature of our business, we may be subject to legal proceedings which may divert management’s time and attention from our business and result in substantial damage awards.

Due to the nature of our business, we may be subject to numerous regulatory investigations, securities claims, civil claims, lawsuits and other proceedings in the ordinary course of our business including those described under Item 3. Legal Proceedings herein. The outcome of these lawsuits is uncertain and subject to inherent uncertainties, and the actual costs to be incurred will depend upon many unknown factors. We may be forced to expend significant resources in the defense of these suits, and we may not prevail. Defending against these and other lawsuits in the future may not only require us to incur significant legal fees and expenses, but may become time-consuming for us and detract from our ability to fully focus our internal resources on our business activities. The results of any legal proceeding cannot be predicted with certainty due to the uncertainty inherent in litigation, the difficulty of predicting decisions of regulators, judges and juries and the possibility that decisions may be reversed on appeal. There can be no assurances that these matters will not have a material adverse effect on our business, financial position or operating results.

We depend on certain key personnel, and our success will depend on our continued ability to retain and attract such qualified personnel.

Our success is dependent on the efforts, abilities and continued service of certain senior officers and key employees and consultants. A number of our key employees and consultants have significant experience in the uranium industry. A loss of service from any one of these individuals may adversely affect our operations, and we may have difficulty or may not be able to locate and hire a suitable replacement.

Certain directors and officers may be subject to conflicts of interest.

The majority of our directors and officers are involved in other business ventures including similar capacities with other private or publicly-traded companies. Such individuals may have significant responsibilities to these other business ventures, including consulting relationships, which may require significant amounts of their available time. Conflicts of interest may include decisions on how much time to devote to our business affairs and what business opportunities should be presented to us. Our Code of Conduct and Ethics provides for guidance on conflicts of interest.

The laws of the State of Nevada and our Articles of Incorporation may protect our directors and officers from certain types of lawsuits.

The laws of the State of Nevada provide that our directors and officers will not be liable to our Company or to our stockholders for monetary damages for all but certain types of conduct as directors and officers. Our Bylaws provide for broad indemnification powers to all persons against all damages incurred in connection with our business to the fullest extent provided or allowed by law. These indemnification provisions may require us to use our limited assets to defend our directors and officers against claims, and may have the effect of preventing stockholders from recovering damages against our directors and officers caused by their negligence, poor judgment or other circumstances.

Several of our directors and officers are residents outside of the United States, and it may be difficult for stockholders to enforce within the United States any judgments obtained against such directors or officers.

Several of our directors and officers are nationals and/or residents of countries other than the United States, and all or a substantial portion of such persons’ assets are located outside of the United States. As a result, it may be difficult for investors to effect service of process on such directors and officers, or enforce within the United States any judgments obtained against such directors and officers, including judgments predicated upon the civil liability provisions of the securities laws of the United States or any state thereof. Consequently, stockholders may be effectively prevented from pursuing remedies against such directors and officers under United States federal securities laws. In addition, stockholders may not be able to commence an action in a Canadian court predicated upon the civil liability provisions under United States federal securities laws. The foregoing risks also apply to those experts identified in this document that are not residents of the United States.

Disclosure controls and procedures and internal control over financial reporting, no matter how well designed and operated, are designed to obtain reasonable, and not absolute, assurance as to its reliability and effectiveness.

Management’s evaluation on the effectiveness of disclosure controls and procedures is designed to ensure that information required for disclosure in our public filings is recorded, processed, summarized and reported on a timely basis to our senior management, as appropriate, to allow timely decisions regarding required disclosure. Management’s report on internal control over financial reporting is designed to provide reasonable assurance that transactions are properly authorized, assets are safeguarded against unauthorized or improper use and transactions are properly recorded and reported. However, any system of controls, no matter how well designed and operated, is based in part upon certain assumptions designed to obtain reasonable, and not absolute, assurance as to its reliability and effectiveness. Any failure to maintain effective disclosure controls and procedures in the future may result in our inability to continue meeting our reporting obligations in a timely manner, qualified audit opinions or restatements of our financial reports, any one of which may affect the market price for our common stock and our ability to access the capital markets.

Proposed  and new legislation in the U.S. Congress, including changes in U.S. tax law, may adversely impact the Company and the value of shares of our common stock.

Changes to U.S. tax laws (which changes may have retroactive application) could adversely affect the Company or holders of shares of our common stock. In recent years, many changes to U.S. federal income tax laws have been proposed and made, and additional changes to U.S. federal income tax laws are likely to continue to occur in the future.

The U.S. Congress has recently passed and is currently considering numerous items of legislation which may be enacted prospectively or with retroactive effect, and which legislation could adversely impact the Company’s financial performance and the value of shares of our common stock. In particular, we understand that new legislation known as the “Build Back Better Act” has been passed by both houses of the U.S. Congress. The legislation includes, without limitation, new corporate minimum income taxes. We understand that the proposals would be effective for 2022 or later years. The legislation and its impact on the Company and investors who purchase shares of our common stock is uncertain.

Risks Related to Our Common Stock

Historically, the market price of our common stock has been and may continue to fluctuate significantly.

On September 28, 2007, our common stock commenced trading on the NYSE American (formerly known as the American Stock Exchange, the NYSE Amex Equities Exchange and the NYSE MKT) and prior to that, traded on the OTC Bulletin Board.

The global markets have experienced significant and increased volatility in the past, and have been impacted by the effects of mass sub-prime mortgage defaults and liquidity problems of the asset-backed commercial paper market, resulting in a number of large financial institutions requiring government bailouts or filing for bankruptcy. The effects of these past events and any similar events in the future may continue to or further affect the global markets, which may directly affect the market price of our common stock and our accessibility for additional financing. Although this volatility may be unrelated to specific company performance, it can have an adverse effect on the market price of our shares which, historically, has fluctuated significantly and may continue to do so in the future.

In addition to the volatility associated with general economic trends and market conditions, the market price of our common stock could decline significantly due to the impact of any one or more events including, but not limited to, the following: (i) volatility in the uranium market; (ii) occurrence of a major nuclear incident such as the events in Japan in March 2011; (iii) changes in the outlook for the nuclear power and uranium industries; (iv) failure to meet market expectations on our exploration, pre-extraction or extraction activities, including abandonment of key uranium projects; (v) sales of a large number of our shares held by certain stockholders including institutions and insiders; (vi) downward revisions to previous estimates on us by analysts; (vii) removal from market indices; (viii) legal claims brought forth against us; and (ix) introduction of technological innovations by competitors or in competing technologies.

A prolonged decline in the market price of our common stock could affect our ability to obtain additional financing which would adversely affect our operations.

Historically, we have relied on equity financing and, more recently, on debt financing, as primary sources of financing. A prolonged decline in the market price of our common stock or a reduction in our accessibility to the global markets may result in our inability to secure additional financing which would have an adverse effect on our operations.

Additional issuances of our common stock may result in significant dilution to our existing shareholders and reduce the market value of their investment.

We are authorized to issue 750,000,000 shares of common stock of which 289,638,307 shares were issued and outstanding as of July 31, 2022. Future issuances for financings, mergers and acquisitions, exercise of stock options and share purchase warrants and for other reasons may result in significant dilution to and be issued at prices substantially below the price paid for our shares held by our existing stockholders. Significant dilution would reduce the proportionate ownership and voting power held by our existing stockholders and may result in a decrease in the market price of our shares.

We are subject to the Continued Listing Criteria of the NYSE American and our failure to satisfy these criteria may result in delisting of our common stock.

Our common stock is currently listed on the NYSE American. In order to maintain this listing, we must maintain certain share prices, financial and share distribution targets, including maintaining a minimum amount of shareholders’ equity and a minimum number of public shareholders. In addition to these objective standards, the NYSE American may delist the securities of any issuer: (i) if in its opinion, the issuer’s financial condition and/or operating results appear unsatisfactory; (ii) if it appears that the extent of public distribution or the aggregate market value of the security has become so reduced as to make continued listing on the NYSE American inadvisable; (iii) if the issuer sells or disposes of principal operating assets or ceases to be an operating company; (iv) if an issuer fails to comply with the NYSE American’s listing requirements; (v) if an issuer’s common stock sells at what the NYSE American considers a “low selling price” and the issuer fails to correct this via a reverse split of shares after notification by the NYSE American; or (vi) if any other event occurs or any condition exists which makes continued listing on the NYSE American, in its opinion, inadvisable.

If the NYSE American delists our common stock, investors may face material adverse consequences including, but not limited to, a lack of trading market for our securities, reduced liquidity, decreased analyst coverage of our securities, and an inability for us to obtain additional financing to fund our operations.

Item 1B. Unresolved Staff Comments

Not applicable

Item 2. Description of Properties

Overview

Uranium Energy Corp. is engaged in conventional and in situ recovery (ISR) uranium extraction and recovery, along with the exploration, permitting and evaluation of uranium properties in the United States, the Republic of Paraguay, and Canada.

ISR Uranium Activities

The Company conducts its ISR recovery activities through its Irigaray Central Processing Plant (“CPP”) and Christensen Ranch ISR Project, located in northeast Wyoming, which it acquired in December 2021 through the acquisition of U1A, and its Hobson CPP and Palangana ISR Project, located in south Texas, which it acquired in 2009 from Uranium One.

The Irigaray CPP Project includes: (i) the Irigaray CPP (100% ownership); (ii) the Christensen Ranch Wellfields (100% ownership); (iii) the Charlie Wellfields (100% ownership); (iv) the Reno Creek ISR Project (100% ownership); (v) the Moore Ranch ISR Project (100% ownership); (vi) the Ludeman ISR Project (100% ownership); (vii) the Allemand-Ross ISR Project; (viii) the Barge ISR Project; (ix) the Jab/West Jab ISR Project (100% ownership); (x) the Nine Mile Lake ISR Project (100% ownership); (xi) the Red Rim ISR Project (100% ownership); and (xii) the Clarkson Hill ISR Project all in Wyoming. See “Non-Material Mineral Properties - Other ISR Projects.” Production from existing wellfields at Christensen Ranch ceased in 2018 and the project was put in care and maintenance mode. Processing of toll resins from other projects continues at the Irigaray CPP. In order for Christensen Ranch to engage in future uranium extraction, the Company will need to incur capital expenditures to restart idled wellfields.

The Hobson CPP Project includes: (i) the Hobson CPP (100% ownership); (ii) the Palangana ISR Project (100% ownership); (iii) the Burke Hollow ISR Project (100% ownership); (iv) the Goliad ISR Project (100% ownership); and (v) the Salvo ISR Project all in Texas. Production from existing wellfields at the Palangana ISR Project ceased in 2016 and the project was put in care and maintenance mode. In order for Palangana to engage in future uranium production, the Company will need to incur capital expenditures to restart idled wellfields.

The 100% owned Yuty ISR Project, located in Paraguay, is an exploration phase project.

Conventional Uranium Activities

The Company’s Anderson Project (100% ownership) located in Arizona, is an exploration phase project containing estimated resources that are suitable for conventional open-pit and underground mining methods.

Irigaray CPP

The following technical and scientific description for the Irigaray CPP Project area (the “Irigaray Project Area”) is based in part on the TRS titled “S-K 1300 Mineral Resource Report Wyoming Assets ISR Hub and Spoke Project, WY USA”, dated March 31, 2022, prepared by Western Water Consultants d/b/a WWC Engineering (“WWC”), a qualified firm (the “QP herein”). The Irigaray Project Area does not have mineral reserves and is therefore considered an Exploration Stage property under S-K 1300 definitions, despite a history of commercial production.

Property Description

The Irigaray Project Area is located in Johnson County, Wyoming, northwest of Pumpkin Buttes and near Willow Creek, within the Powder River Basin (the “PRB”). The Irigaray Project Area covers 3,107 acres, including all (or portions of) 12 sections of the PRB.

The Irigaray Project Area is approximately 70 air miles north-northeast of Casper, Wyoming, and 30 air miles east of Kaycee, Wyoming. The Irigaray Project Area can be accessed from Kaycee, Wyoming, by traveling east on State Highway 192 through the town of Sussex, and then traveling north on Streeter Road to the intersection of Irigaray Road. The Irigaray Project Area is located on Irigaray Road approximately four miles north of the intersection with Streeter Road. The Irigaray Project Area is primarily located on private surface land, federal BLM land and a portion located on one section of state-managed land.

Figure 1: Map of UEC Project Areas

Ownership

The Irigaray Project Area is owned and operated by UEC. UEC has executed surface use and access agreements and fee mineral leases with landowners who hold surface and mineral ownership within and outside the various Irigaray Project Area boundaries. UEC also holds unpatented BLM lode claims and leases on Wyoming state land on the various project areas.

Mineral rights for the Irigaray Project Area are a combination of federally administered minerals (unpatented lode claims), State of Wyoming mineral leases and private (fee) mineral leases. Federal mining claims were staked and recorded consistent with federal and state law, state mineral leases were obtained by submitting a lease application and appropriate fee to the State Board of Land Commissioners and fee mineral leases were obtained through negotiation with individual mineral owners.

Table 1: Property Characteristics Summary

Within the Irigaray Project Area, UEC holds one State of Wyoming uranium lease on state lands and 257 unpatented lode claims on federally administered minerals. There is one fee (private) mineral lease on the Irigaray Project Area.

Payments for the state and private lease and BLM mining claim filing payments are up to date, as of the effective date of the TRS.

Accessibility, Climate, Local Resources, Infrastructure and Physiography

The Irigaray Project Area is within Johnson County, Wyoming. This county resides in the Wyoming Basin Physiographic Province in the southern portion of the PRB. The site generally lies near the synclinal axis of the basin. The PRB is a part of the Northwestern Great Plains eco-region, a semiarid rolling plain of shale and sandstone punctuated by occasional buttes. Regional structural features also include the Big Horn Mountains to the west, Casper Arch to the south and the Black Hills to the east. In the Irigaray Project Area the landscape is dominated by the Pumpkin Buttes.

Topography in the Irigaray Project Area ranges from generally flat to gently rolling hills with numerous drainages containing ephemeral streams dissecting the Irigaray Project Area. Elevations ranges from approximately 4,500 ft to 5,400 ft above mean sea level.

Vegetation within the Irigaray Project Area consists primarily of grassland, with areas of sagebrush. The Irigaray Project Area lies within the mixed grass eco-region of the Northwestern Great Plains. Interspersed among these major vegetation communities, within and along the ephemeral drainages, are grassland and meadow grassland and less abundant types of seeded grasslands (improved pastures).

The Irigaray Project Area in the PRB is located in a semi-arid or steppe climate. The region is characterized by cold, harsh winters and hot, dry summers. The spring season is relatively warm and moist, and autumns are cool. Temperature extremes range from roughly -25° F in the winter to 100° F in the summer. Typically, the last freeze occurs during late May and the first freeze occurs in mid- to late September.

Yearly precipitation in the PRB averages about 13 inches. The PRB is prone to severe thunderstorm events throughout the spring and early summer months, and much of the precipitation is attributed to these events. Snow falls throughout the winter months (approximately 40 to 50 inches per year), but provides much less moisture than rain events.

The nearest community to the Irigaray Project Area is Wright, a small, incorporated town with a population of 1,644 at the junction of Wyoming Highway 387 and Wyoming Highway 59. Gillette is a major local population center with a population of 33,403 and a regional airport. Gillette is located along Interstate 90, north and east of the Irigaray Project Area via both Wyoming Highway 59 (due north of Wright) and Wyoming Highway 50. The towns of Edgerton and Midwest are in Natrona County, southwest of the Irigaray Project Area on Wyoming Highway 387.

A major north–south railroad, BNSF Railway, used primarily for transporting coal, lies east of the Irigaray Project Area and parallel to Wyoming Highway 59.

Equipment and supplies needed for exploration and day-to-day operations are available from population centers such as Gillette and Casper. Specialized equipment for the Irigaray Project Area will likely need to be acquired from outside of Wyoming.

The local economy is geared toward coal mining and oil and gas production as well as ranching operations, providing a well-trained and capable pool of workers for ISR production and processing operations. Workers will reside locally and commute to work daily.

As a result of energy development over the past 50 years, the Irigaray Project Area has existing or nearby (less than two miles) electrical power, gas and adequate telephone and internet connectivity.

The Irigaray Project Area is a fully operational and licensed ISR processing plant for resin elution, precipitation, filtration, and drying and packaging of U₃O₈. The Irigaray Project Area has a capacity of 1.3 million lbs U₃O₈ per year, which is expandable to 2.5 million lbs U₃O₈ per year. A second elution system is also at the Irigaray Project Area for toll processing. The Irigaray Project Area is equipped with a warehouse and office, power, telephone, water tank and domestic waste disposal.

History

Uranium was first discovered in the southern PRB during the early 1950s. By the mid- to late 1950s, small open pit mine operations were established in the PRB. Early prospecting and exploration included geologic mapping and gamma surveys, which led to discoveries of uranium in the Wasatch and Fort Union Formations. Extensive drill hole exploration has been utilized to locate deeper uranium mineralization since the 1960s to progress geologic models.

The table below describes the historic ownership and operations at the Irigaray Project Area.

Table 2: Historic Ownership and Operations at the Irigaray Project Area

Permitting and Licensing

A majority of the resources in the Irigaray Project Area are not permitted. Portions of the Irigaray Project Area resources on federal lands would require BLM permitting. Permitting would include wildlife considerations, such as greater sage grouse leks and core area, which could limit development of resources. The CPP and related infrastructure are fully permitted to process loaded ion-exchange resins.

Geologic setting, Mineralization, and Deposit

The Irigaray Project Area resides in the PRB. The PRB extends over much of northeastern Wyoming and southeastern Montana and consists of a large north-northwest trending asymmetric syncline, with the basin axis located to the west of the projects. The PRB is bounded by the Big Horn Mountains and Casper Arch to the west, the Black Hills to the east and the Hartville Uplift and Laramie Mountains to the south. The PRB is filled with marine, non-marine and continental sediments ranging in age from early Paleozoic through Cenozoic.

Within the PRB, the Paleocene Fort Union Formation conformably overlies the Lance Formation and is a fluvial-sedimentary stratigraphic unit that consists of fine- to coarse-grained arkosic sandstone, which is interbedded with siltstone, mudstone and carbonaceous materials. In some areas of the PRB, the Fort Union Formation is divided into two members, identified as the Upper and Lower members of the Fort Union Formation. However, Flores divides the Fort Union into three members: the Tullock; Lebo; and Tongue River members (listed from oldest to youngest); as follows:

Uranium mineralization occurs in zones that are located in channel sands of the Fort Union Formation. These channel sands are typical fining upward sand sequences consisting of fine-grained sandstones. The zones of mineralization are formed as typical roll-front deposits in these sandstones.

The early Eocene Wasatch Formation unconformably overlies the Fort Union Formation around the margins of the PRB. However, the two formations are conformable and gradational towards the basin center. The relative amount of coarse, permeable clastics increases near the top of Fort Union, and the overlying Wasatch Formation contains numerous beds of sandstone that can sometimes be correlated over wide areas. The Wasatch-Fort Union contact is separated by Paleocene and Eocene rocks and is generally placed above the Roland coal. However, other authors have placed the Wasatch-Fort Union contact above the School, Badger and Anderson Coals in other parts of the PRB.

The Wasatch Formation occurs at the surface in the central PRB, but has been mostly removed by erosion with only small, scattered outcrops still present in the southern PRB. The Wasatch Formation is also a fluvial sedimentary unit that consists of a series of silt to very coarse-grained gradational intervals in arkosic sandstone. The sandstone horizons in the Wasatch Formation are the host rocks for several uranium deposits in the central PRB. Within this area, mineralization is found in a 50- to 100-ft thick sandstone lens. On a regional scale, mineralization is localized and controlled by facies changes within this sandstone, including thinning of the sandstone unit, decrease in grain size and increase in clay and organic material content. The Wasatch Formation reaches a maximum thickness of about 1,600 ft and dips northwestward from one degree to two-and-a-half degrees in the southern and central parts of the PRB.

The Oligocene White River Formation overlies the Wasatch Formation and has been removed from most of the basin by erosion. Remnants of this unit crop out on the Pumpkin Buttes, and at the extreme southern edge of the PRB. The White River Formation consists of clayey sandstone, claystone, a boulder conglomerate and tuffaceous sediments, which may be the primary source rock for uranium in the southern part of the PRB as a whole. The youngest sediments consist of Quaternary alluvial sands and gravels locally present in larger valleys. Quaternary eolian sands can also be found locally.

The Irigaray Project Area targets mineralization in the Eocene-aged Wasatch Formation.

Mineralization in the Irigaray Project Area occurs in fluvial sandstones of the lower parts of the Wasatch Formation. Most of the upper Wasatch Formation has been eroded away. The sandstones are arkosic, fine- to coarse-grained with local calcareous lenses. The sandstones contain minor amounts of organic carbon that occurs as dispersed bits or as stringers. Unaltered sandstones are generally gray, while altered sandstones are tan or pink due to hematite, or show yellowish coloring due to limonite.

Pyrite occurs in several forms within the host sandstones. In unaltered sandstones, pyrite occurs as small to large single euhedral crystals associated with magnetite, ilmenite and other dark detrital minerals. In altered sandstone, pyrite is typically absent, but locally occurs as tarnished, very fine-grained euhedral crystals. In areas of intense or heavy mineralization, pyrite locally occurs as massive, tarnished crystal aggregates (Utah International, 1971).

The Irigaray Project Area contain portions of four alteration systems, all within fluvial sands of the Wasatch Formation. These fluvial host systems are labelled K1, K2, K3 and K4 sands and are in descending order. These sands vary in thickness from 0 ft to 100 ft within the Irigaray Project Area. They coalesce within portions of the Irigaray Project Area and form massive sand sequences of roughly 250 ft (80 m) in thickness. These sands in turn host the K1, K2, K3 and K4 uranium roll-front systems, each of which is composed of multiple stacked individual roll-front deposits.

Data Verification

The resource estimate is based on historic drill holes with uranium assays by gamma logging and a limited number of core holes with chemical assays. Industry standard methods were used at the time of data collection.

The Irigaray Project Area is currently on care and maintenance and has been successfully mined since 1978. Past production from both projects confirms the presence of significant mineral resources that were estimated using similar methods.

A study was conducted in 1982 that compared the chemical assays of 77 historic core holes drilled on the Irigaray Project Area with radiometric data that had been reinterpreted. Conclusions of the study indicate that the total grade thicknesses (the “GT”) are well within the margin of error expected in such calculations, but that radiometric interpretations showed a bias. The original estimates underestimated the in-place grades and overestimated the in-place thicknesses of mineralized zones. It was concluded that these biases effectively offset one another.

Another study in 1994 was conducted with Prompt Fission Neutron (“PFN”) logging equipment to determine equilibrium and to determine the extent of remobilized uranium in a producing wellfield. Core samples were also collected and chemically assayed to check the accuracy of the PFN logging and further determine disequilibrium. The study found that the PFN logging determined the same vertical and horizontal mineralization limits as the gamma logs. Core hole chemical assays were also compared with historic gamma logs, and the results overall indicated reasonably good correlations between the two.

A WWC professional previously worked at the Irigaray Project Area from 1995 until 1999. During that time, he was the only on-staff geologist at the Irigaray Project Area and was responsible for reviewing thousands of logs for mine unit planning and development and has personal knowledge of the data quality.

Mineral Resource Estimates

The following key assumptions were used for resource estimates, unless otherwise noted:

The GT contour method was used to estimate the mineral resources at the Irigaray Project Area. The GT contour method is one of the most widely used and dependable methods to estimate resources in uranium roll-front deposits. The basis of the GT contour method is the GT (grade x mineralized thickness) values, which are determined for each drill hole using radiometric log results and a suitable GT cutoff, below which the GT value is considered to be zero. The GT values are then plotted on a drill hole map and GT contours are drawn accordingly using roll-front data derived from cuttings and the nature of the gamma anomalies. The resources are calculated from the area within the GT contour boundaries considering the disequilibrium factor (“DEF”) and the ore zone density.

The resource estimate method, general parameters and mineralized cutoffs used at the Irigaray Project Area are summarized below.

Table 3: Irigaray Project Area Resource Estimate Methodology

Based on the depths of mineralization, average grade, thickness and GT, it is the TRS QP’s opinion that the mineral resources of the Irigaray Project Area can be recoverable by ISR methods using a long-term uranium price of $40/lb.

Uranium does not trade on the open market and many of the private sales contracts are not publicly disclosed. UEC used $40/lb as the forecast uranium price for the Irigaray Project Area. This is based on: (i) the long-term contract price at the end of February 2022, which was $43.88/lb from Cameco Resources’ combination of Ux Consulting (“UxC”) and Trade Tech reports (Cameco, 2022); (ii) the spot price at the end of February 2022 ($48.75/lb); (iii) UxC’s price forecast; and (iv) UEC’s understanding of market expectations. The table below contains the UxC uranium price forecast for Q4 of 2021

Table 4: UxC Q4 2021 Uranium Price Forecast ($/lb U₃O₈)

In the opinion of the TRS QP, $40/lb is a conservative forecast price for the following reasons:

For the above reasons, the TRS QP also believes that a $40/lb price is considered reasonable by the QP for use in cutoff determination and to assess reasonable prospects for eventual economic extraction.

Measured, indicated and inferred resource classifications at the Irigaray Project Area are defined by the density of the drill hole data. Higher drill hole densities allow more confidence in the shape and size of the interpreted mineral horizons. The table below details the resource classification criteria used in the resource estimates in the Irigaray Project Area.

Table 5: Irigaray Project Area Drill Hole Information

There are numerous reasons that mineralization was interpreted as measured resources within the Irigaray Project Area:

This combination of drill hole spacing, well-known subsurface geology, well-understood deposit model, successful production and the variety of data collected led WWC, as the TRS QP, to conclude that the mineralization in areas with drill hole spacing tabulated above fit the definition for measured resources.

Mineral resources were estimated separately for the Irigaray Project Area. The estimates of measured and indicated mineral resources for the Irigaray Project Area are reported in the table below and the estimates of inferred mineral resources are reported in the table following.

Table 6: Irigaray Project Area Measured and Indicated Mineral Resources

Table 7: Irigaray Project Area Inferred Mineral Resources

Details regarding the mineral resource estimate disclosed herein can be found in Chapter 11, Mineral Resource Estimates of the TRS.

Present Condition of Property and Work Completed to Date

Irigaray is operating in a toll processing capacity with the facilities maintained for this purpose.

The Company’s Planned Work

Irigaray will be maintained to continue to serve in a toll processing capacity.

Christensen Ranch ISR Project

The following technical and scientific description for the Christensen Ranch Project Area (the “Christensen Ranch Project Area”) is based in part on the TRS titled “S-K 1300 Mineral Resource Report Wyoming Assets ISR Hub and Spoke Project, WY USA”, current on March 31, 2022, prepared by WWC, a qualified firm (the “QP” herein). The Christensen Ranch Project Area does not have mineral reserves and is therefore considered an Exploration Stage property under S-K 1300 definitions, despite a history of commercial production.

Property Description

The Christensen Ranch Project Area is located in Johnson and Campbell Counties, Wyoming, west of Pumpkin Buttes within the PRB. The Christensen Ranch Project Area covers 14,163 acres, including all (or portions of) 30 sections of the PRB.

The Christensen Ranch Project Area is approximately 70 air miles north-northeast of Casper, Wyoming, and 30 air miles east of Kaycee, Wyoming. The Christensen Ranch Project Area can be accessed from Kaycee, Wyoming, by traveling east on State Highway 192 through the town of Sussex, and then traveling north on Streeter Road to the intersection of Irigaray Road. The Christensen Ranch Project Area boundary is located 1.6 miles southeast of the intersection of Streeter Road and Irigaray Road. The Christensen Ranch satellite ion exchange (IX) plant is approximately three miles north-northeast of Irigaray Road. The Christensen Ranch Project Area is primarily located on private surface land, with two portions located on federal BLM-managed land.

Figure 1: Map of UEC Project Areas

Ownership

This Christensen Ranch Project Area is owned and operated by UEC. UEC has executed surface use and access agreements and fee mineral leases with landowners who hold surface and mineral ownership within and outside the various Christensen Ranch Project Area boundaries. UEC also holds unpatented BLM lode claims and leases on Wyoming state land on the project area.

Mineral rights for the Christensen Ranch Project Area are a combination of federally administered minerals (unpatented lode claims), State of Wyoming mineral leases and private (fee) mineral leases. Federal mining claims were staked and recorded consistent with federal and state law, state mineral leases were obtained by submitting a lease application and appropriate fee to the State Board of Land Commissioners, and fee mineral leases were obtained through negotiation with individual mineral owners.

Table 1: Property Characteristics Summary

Within the Christensen Ranch Project Area, UEC holds one State of Wyoming uranium lease on state lands and 257 unpatented lode claims on federally administered minerals. There is one fee (private) mineral lease on the Christensen Ranch Project Area.

Payments for the state and private lease and BLM mining claim filing payments are up to date, as of the effective date of the TRS.

Accessibility, Climate, Local Resources, Infrastructure and Physiography

The Christensen Ranch Project Area is within the Johnson and Campbell counties, Wyoming. These counties reside in the Wyoming Basin Physiographic Province in the southern portion of the PRB. The sites generally lie near the synclinal axis of the basin. The PRB is a part of the Northwestern Great Plains eco-region, a semi-arid rolling plain punctuated by occasional buttes. Regional structural features also include the Bighorn Mountains to the west, Casper Arch to the south and the Black Hills to the east. In the Christensen Ranch Project Area, the landscape is dominated by the Pumpkin Buttes.

Topography in the Christensen Ranch Project Area ranges from generally flat to gently rolling hills, with numerous drainages containing ephemeral streams dissecting the Christensen Ranch Project Area. Elevations ranges from approximately 4,500 ft to 5,400 ft above mean sea level.

Vegetation within the Christensen Ranch Project Area consists primarily of grassland, with areas of sagebrush. The Christensen Ranch Project Area lies within the mixed grass eco-region of the Northwestern Great Plains. Interspersed among these major vegetation communities, within and along the ephemeral drainages, are grassland and meadow grassland and less abundant types of seeded grasslands (improved pastures).

The Christensen Ranch Project Area in the PRB is located in a semi-arid or steppe climate. The region is characterized by cold, harsh winters and hot, dry summers. The spring season is relatively warm and moist, and autumns are cool. Temperature extremes range from roughly -25° F in the winter to 100° F in the summer. Typically, the last freeze occurs during late May and the first freeze in mid- to late September.

Yearly precipitation in the PRB averages about 13 inches. The PRB is prone to severe thunderstorm events throughout the spring and early summer months, and much of the precipitation is attributed to these events. Snow falls throughout the winter months (approximately 40 to 50 inches per year), but provides much less moisture than rain events.

The nearest community to the Christensen Ranch Project Area is Wright, Wyoming, a small, incorporated town with a population of 1,644 at the junction of Wyoming Highway 387 and Wyoming Highway 59. Gillette is a major local population center with a population of 33,403 and a regional airport. Gillette is located along Interstate 90, north and east of the Christensen Ranch Project Area via both Wyoming Highway 59 (due north of Wright) and Wyoming Highway 50. The towns of Edgerton and Midwest are in Natrona County, southwest of the Christensen Ranch Project Area on Wyoming Highway 387.

A major north–south railroad, BNSF Railway, used primarily for transporting coal, lies east of the Christensen Ranch Project Area and parallel to Wyoming Highway 59.

Equipment and supplies needed for exploration and day-to-day operations are available from population centers such as Gillette and Casper. Specialized equipment for the wellfields will likely need to be acquired from outside of Wyoming.

The local economy is geared toward coal mining and oil and gas production as well as ranching operations, providing a well-trained and capable pool of workers for ISR production and processing operations. Workers will reside locally and commute to work daily.

As a result of energy development over the past 50 years, the Christensen Ranch Project Area has existing or nearby (less than two miles) electrical power, gas, and adequate telephone and internet connectivity.

The Christensen Ranch Project Area is equipped with a satellite IX plant with a 6,500 gallons per minute (gpm) installed capacity, a groundwater restoration plant with a 1,000 gpm capacity, two wastewater disposal wells and four lined evaporation ponds.

History

Uranium was first discovered in the southern PRB during the early 1950s. By the mid- to late 1950s, small open pit mine operations were established in the PRB. Early prospecting and exploration included geologic mapping and gamma surveys, which led to discoveries of uranium in the Wasatch and Fort Union Formations. Extensive drill hole exploration has been utilized to locate deeper uranium mineralization since the 1960s to progress geologic models.

The table below describes the historic ownership and operations at the Christensen Ranch Project Area.

Table 2: Historic Ownership and Operations at the Christensen Ranch Project Area

Permitting and Licensing

The Christensen Ranch Project Area is fully permitted through the WDEQ/Land Quality Division (“LQD”).

Geologic Setting, Mineralization and Deposit

The Christensen Ranch Project Area resides in the PRB. The PRB extends over much of northeastern Wyoming and southeastern Montana and consists of a large north-northwest trending asymmetric syncline, with the basin axis located to the west of the projects. The PRB is bounded by the Bighorn Mountains and Casper Arch to the west, the Black Hills to the east, and the Hartville Uplift and Laramie Mountains to the south. The PRB is filled with marine, non-marine and continental sediments ranging in age from early Paleozoic through Cenozoic.

Within the PRB, the Paleocene Fort Union Formation conformably overlies the Lance Formation and is a fluvial-sedimentary stratigraphic unit that consists of fine- to coarse-grained arkosic sandstone, which is interbedded with siltstone, mudstone and carbonaceous materials. In some areas of the PRB, the Fort Union Formation is divided into two members, identified as the Upper and Lower members of the Fort Union Formation. However, the U.S. Geological Survey (“USGS”) divides the Fort Union into three members: the Tullock; Lebo; and Tongue River members (listed from oldest to youngest); as follows:

Uranium mineralization occurs in zones that are located in channel sands of the Fort Union Formation. These channel sands are typical fining upward sand sequences consisting of fine-grained sandstones. The zones of mineralization are formed as typical roll-front deposits in these sandstones.

The early Eocene Wasatch Formation unconformably overlies the Fort Union Formation around the margins of the PRB. However, the two formations are conformable and gradational towards the basin center. The relative amount of coarse, permeable clastics increases near the top of Fort Union, and the overlying Wasatch Formation contains numerous beds of sandstone that can sometimes be correlated over wide areas. The Wasatch-Fort Union contact is separated by Paleocene and Eocene rocks and is generally placed above the Roland coal. However, other authors have placed the Wasatch-Fort Union contact above the School, Badger and Anderson Coals in other parts of the PRB.

The Wasatch Formation occurs at the surface in the central PRB, but has been mostly removed by erosion with only small, scattered outcrops still present in the southern PRB. The Wasatch Formation is also a fluvial sedimentary unit that consists of a series of silt to very coarse-grained gradational intervals in arkosic sandstone. The sandstone horizons in the Wasatch Formation are the host rocks for several uranium deposits in the central PRB. Within this area, mineralization is found in 50- to 100-ft thick sandstone lenses. On a regional scale, mineralization is localized and controlled by facies changes within this sandstone, including thinning of the sandstone unit, decrease in grain size, and increase in clay and organic material content. The Wasatch Formation reaches a maximum thickness of about 1,600 ft and dips northwestward from one degree to two-and-a-half degrees in the southern and central parts of the PRB.

The Oligocene White River Formation overlies the Wasatch Formation and has been removed from most of the PRB by erosion. Remnants of this unit crop out on the Pumpkin Buttes and at the extreme southern edge of the PRB. The White River Formation consists of clayey sandstone, claystone, a boulder conglomerate and tuffaceous sediments, which may be the primary source rock for uranium in the southern part of the PRB as a whole. The youngest sediments consist of Quaternary alluvial sands and gravels locally present in larger valleys. Quaternary eolian sands can also be found locally.

The Christensen Ranch Project Area targets mineralization in the Eocene-aged Wasatch Formation.

Mineralization in the Christensen Ranch Project Area occurs in fluvial sandstones of the lower parts of the Wasatch Formation. Most of the upper Wasatch Formation has been eroded away. The sandstones are arkosic, fine- to coarse-grained with local calcareous lenses. The sandstones contain minor amounts of organic carbon that occurs as dispersed bits or as stringers. Unaltered sandstones are generally gray, while altered sandstones are tan or pink due to hematite, or show yellowish coloring due to limonite.

Pyrite occurs in several forms within the host sandstones. In unaltered sandstones, pyrite occurs as small to large single euhedral crystals associated with magnetite, ilmenite and other dark detrital minerals. In altered sandstone, pyrite is typically absent, but locally occurs as tarnished, very fine-grained euhedral crystals. In areas of intense or heavy mineralization, pyrite locally occurs as massive, tarnished crystal aggregates.

The Christensen Ranch Project Area contains portions of four alteration systems, all within fluvial sands of the Wasatch Formation. These fluvial host systems are identified as K1, K2, K3 and K4 sands and are in descending order. These sands vary in thickness from 0 ft to 100 ft within the Christensen Ranch Project Area. They coalesce within portions of the Christensen Ranch Project Area and form massive sand sequences of roughly 250 ft (80 m) in thickness. These sands in turn host the K1, K2, K3 and K4 uranium roll-front systems, each of which is composed of multiple stacked individual roll-front deposits.

Uranium mineralization at the Christensen Ranch Project Area is typical of Wyoming roll-front sandstone deposits. The formation of roll-front deposits is largely a groundwater process that occurs when uranium-rich, oxygenated groundwater interacts with a reducing environment in the subsurface and precipitates uranium. The most favorable host rocks for roll-fronts are permeable sandstones with large aquifer systems. Interbedded mudstone, claystone and siltstone are often present and aid in the formation process by focusing groundwater flux. The geometry of mineralization is dominated by the classic roll-front “C” shape or crescent configuration at the redox interface. The highest-grade portion of the front occurs in a zone termed the “nose” within reduced ground just ahead of the alteration front. Ahead of the nose, at the leading edge of the solution front, mineral quality gradually diminishes to barren within the “seepage” zone. Trailing behind the nose, in oxidized (altered) ground, are weak remnants of mineralization referred to as “tails” which have resisted re-mobilization to the nose due to association with shale, carbonaceous material or other lithologies of lower permeability. Tails are generally not amenable to ISR because the uranium is typically found within strongly reduced or impermeable strata, therefore making it difficult to leach.

Data Verification

The resource estimate is based on historic drill holes with uranium assays by gamma logging and a limited number of core holes with chemical assays. Industry standard methods were used at the time of data collection.

The Christensen Ranch Project Area is currently on care and maintenance and has been successfully mined since 1978. Past production confirms the presence of significant mineral resources that were estimated using similar methods.

A study was conducted in 1982 that compared the chemical assays of 77 historic core holes drilled on the Christensen Ranch Project Area with radiometric data that had been reinterpreted. Conclusions of the study indicate that the total GT are well within the margin of error expected in such calculations, but that radiometric interpretations showed a bias. The original estimates underestimated the in-place grades and overestimated the in-place thicknesses of mineralized zones. It was concluded that these biases effectively offset one another.

Another study in 1994 was conducted with PFN logging equipment to determine equilibrium and to determine the extent of remobilized uranium in a producing wellfield. Core samples were also collected and chemically assayed to check the accuracy of the PFN logging and further determine disequilibrium. The study found that the PFN logging determined the same vertical and horizontal mineralization limits as the gamma logs. Core hole chemical assays were also compared with historic gamma logs, and the results overall indicated reasonably good correlations between the two.

A WWC professional previously worked at the Christensen Ranch Project Area from 1995 until 1999. During that time, he was the only on-staff geologist at the Christensen Ranch Project Area and was responsible for reviewing thousands of logs for mine unit planning and development and has personal knowledge of the data quality.

Mineral Resource Estimates

The following key assumptions were used for resource estimates, unless otherwise noted:

The GT contour method was used to estimate the mineral resources at the Christensen Ranch Project Area. The GT contour method is one of the most widely used and dependable methods to estimate resources in uranium roll-front deposits. The basis of the GT contour method is the GT (grade x mineralized thickness) values, which are determined for each drill hole using radiometric log results and a suitable GT cutoff, below which the GT value is considered to be zero. The GT values are then plotted on a drill hole map and GT contours are drawn accordingly using roll-front data derived from cuttings and the nature of the gamma anomalies. The resources are calculated from the area within the GT contour boundaries considering the DEF and the ore zone density.

The resource estimate method, general parameters and mineralized cutoffs used at the Christensen Ranch Project Area are summarized below.

Table 3: Christensen Ranch Project Area Resource Estimate Methodology

Based on the depths of mineralization, average grade, thickness and GT, it is the TRS QP’s opinion that the mineral resources of the Christensen Ranch Project Area can be recoverable by ISR methods using a long-term uranium price of $40/lb.

Uranium does not trade on the open market and many of the private sales contracts are not publicly disclosed. UEC used $40/lb as the forecast uranium price for the Christensen Ranch Project Area. This is based on: (i) the long-term contract price at the end of February 2022, which was $43.88/lb from Cameco Resources’ combination of UxC and Trade Tech reports (Cameco, 2022); (ii) the spot price at the end of February 2022 ($48.75/lb); (iii) UxC’s price forecast; and (iv) UEC’s understanding of market expectations. The table below contains the UxC uranium price forecast for Q4 of 2021.

Table 4: UxC Q4 2021 Uranium Price Forecast ($/lb U₃O₈)

In the opinion of the TRS QP, $40/lb is a conservative forecast price for the following reasons:

For the above reasons, the TRS QP also believes that a $40/lb price is considered reasonable for use in cutoff determination and to assess reasonable prospects for eventual economic extraction.

Measured, indicated and inferred resource classifications at the Christensen Ranch Project Area are defined by the density of the drill hole data. Higher drill hole densities allow more confidence in the shape and size of the interpreted mineral horizons. Table below details the resource classification criteria used in the resource estimates in the Christensen Ranch Project Area.

Table 5: Project Area Drill Hole Information

There are numerous reasons that mineralization was interpreted as measured resources within the Christensen Ranch Project Area:

This combination of drill hole spacing, well-known subsurface geology, well-understood deposit model, successful production and the variety of data collected led WWC, as the TRS QP, to conclude that the mineralization in areas with drill hole spacing tabulated above fit the definition for measured resources.

Mineral resources were estimated separately for the Christensen Ranch Project Area. The estimates of measured and indicated mineral resources for the Christensen Ranch Project Area are reported in the table below and the estimates of inferred mineral resources are reported in table following.

Table 6: Christensen Ranch Project Area Measured and Indicated Mineral Resources

Table 7: Christensen Ranch Project Area inferred Mineral Resources

Details regarding the mineral resource estimate disclosed herein can be found in Chapter 11, Mineral Resource Estimates of the TRS.

Present Condition of Property and Work Completed to Date

The Christensen Ranch Project Area is currently under care and maintenance. Mine Units 2, 3, 4 and 6 were determined restored by the WDEQ/LQD in 2021. Mine Units 5, 7, 8 and 10 are in a standby mode awaiting restart, and Mine Units 9, 11 and 12 have yet to be constructed.

The Company’s Planned Work

The Christensen Ranch Project Area is currently under care and maintenance, pending market conditions improving sufficiently to resume production.

Moore Ranch ISR Project

The following technical and scientific description for the Moore Ranch project area (the “Moore Ranch Project Area”) is based in part on the TRS titled “S-K 1300 Mineral Resource Report Wyoming Assets ISR Hub and Spoke Project, WY USA”, current on March 31, 2022, prepared by WWC, a qualified firm (the “QP” herein). The Moore Ranch Project Area does not have mineral reserves and is therefore considered an Exploration Stage property under S-K 1300 definitions, despite a history of commercial production.

Property Description

The Moore Ranch Project Area is located in Campbell County, Wyoming, the southern portion of the Pumpkin Buttes within the PRB. The Moore Ranch Project area covers 6,281 acres, including all (or portions of) 16 sections of the PRB.

The Moore Ranch Project Area is 54 air miles northeast of Casper, Wyoming, and 24 miles southwest of Wright, WY, along State Highway 387. The Moore Ranch Project Area is primarily located on private surface land with some areas of state-managed land.

Figure 1: Map of UEC Project Areas

Ownership

This Moore Ranch Project Area is owned and operated by UEC. UEC has executed surface use and access agreements and fee mineral leases with landowners who hold surface and mineral ownership within and outside the various Moore Ranch Project Area boundaries. UEC also holds unpatented BLM lode claims and leases on Wyoming state land on the project area.

Mineral rights for the Moore Ranch Project Area are a combination of federally administered minerals (unpatented lode claims), State of Wyoming mineral leases and private (fee) mineral leases. Federal mining claims were staked and recorded consistent with federal and state law, state mineral leases were obtained by submitting a lease application and appropriate fee to the State Board of Land Commissioners and fee mineral leases were obtained through negotiation with individual mineral owners.

Table 1: Property Characteristics Summary

Within the Moore Ranch Project Area, UEC holds two State of Wyoming uranium leases on state lands and 86 unpatented lode claims on federally administered minerals. There are five fee (private) mineral leases with private mineral owners on the Moore Ranch Project Area.

Payments for the state and private lease and BLM mining claim filing payments are up to date, as of the effective date of the TRS.

Accessibility, Climate, Local Resources, Infrastructure and Physiography

The Moore Ranch Project Area is within Campbell County, Wyoming. This county resides in the Wyoming Basin Physiographic Province in the southern portion of the PRB. This site generally lies near the synclinal axis of the basin. The PRB is a part of the Northwestern Great Plains eco-region, a semi-arid rolling plain of shale and sandstone punctuated by occasional buttes. Regional structural features also include the Big Horn Mountains to the west, Casper Arch to the south and the Black Hills to the east. In the northern Moore Ranch Project Area, the landscape is dominated by the Pumpkin Buttes.

Topography in the Moore Ranch Project Area ranges from generally flat to gently rolling hills, with numerous drainages containing ephemeral streams dissecting the Moore Ranch Project Area. Elevations ranges from approximately 4,500 ft to 5,400 ft above mean sea level.

Vegetation within the Moore Ranch Project Area consists primarily of grassland, with areas of sagebrush. The Moore Ranch Project Area lies within the mixed grass eco-region of the Northwestern Great Plains. Interspersed among these major vegetation communities, within and along the ephemeral drainages, are grassland and meadow grassland and less abundant types of seeded grasslands (improved pastures).

The Moore Ranch Project Area in the PRB is located in a semi-arid or steppe climate. The region is characterized by cold, harsh winters and hot, dry summers. The spring season is relatively warm and moist, and autumns are cool. Temperature extremes range from roughly -25° F in the winter to 100° F in the summer. Typically, the last freeze occurs during late May and the first freeze occurs in mid- to late September.

Yearly precipitation in the PRB averages about 13 inches. The PRB is prone to severe thunderstorm events throughout the spring and early summer months, and much of the precipitation is attributed to these events. Snow falls throughout the winter months (approximately 40 to 50 inches per year), but provides much less moisture than rain events.

The nearest community to the Moore Ranch Project Area is Wright, Wyoming a small, incorporated town with a population of 1,644 at the junction of Wyoming Highway 387 and Wyoming Highway 59. Gillette is a major local population center with a population of 33,403 and a regional airport. Gillette is located along Interstate 90, north and east of the Moore Ranch Project Area via both Wyoming Highway 59 (due north of Wright) and Wyoming Highway 50. The towns of Edgerton and Midwest are in Natrona County, approximately 20 to 30 miles southwest of the Moore Ranch Project Area on Wyoming Highway 387.

A major north–south railroad, BNSF Railway, used primarily for transporting coal, lies east of the Moore Ranch Project Area and parallel to Wyoming Highway 59.

Equipment and supplies needed for exploration and day-to-day operations are available from population centers such as Gillette and Casper. Specialized equipment for the wellfields will likely need to be acquired from outside of Wyoming.

The local economy is geared toward coal mining and oil and gas production as well as ranching operations, providing a well-trained and capable pool of workers for ISR production and processing operations. Workers will reside locally and commute to work daily.

As a result of energy development over the past 50 years, all the Moore Ranch Project Area has existing or nearby (less than two miles) electrical power, gas and adequate telephone and internet connectivity.

At the Moore Ranch Project Area, non-potable water will be supplied by wells developed on or near the Moore Ranch Project Area. Water extracted as part of ISR will be recycled for reinjection. Four Class I Underground Injection Control (UIC) disposal wells have been permitted for disposal of limited quantities of fluids that cannot be returned to the production aquifers. The Moore Ranch Project Area is adjacent to paved, public roadways which facilitate the transportation of equipment, supplies, personnel and products. Electrical power lines extend into and across the Moore Ranch Project Area.

History

Uranium was first discovered in the southern PRB during the early 1950s. By the mid- to late 1950s, small open pit mine operations were established in the PRB. Early prospecting and exploration included geologic mapping and gamma surveys, which led to discoveries of uranium in the Wasatch and Fort Union Formations. Extensive drill hole exploration has been utilized to locate deeper uranium mineralization since the 1960s to progress geologic models.

The table below describes the historic ownership and operations at the Moore Ranch Project Area.

Permitting and Licensing

The Moore Ranch Project Area is fully permitted through the WDEQ/LQD.

Geologic Setting, Mineralization, and Deposit

The Moore Ranch Project Area resides in the PRB. The PRB extends over much of northeastern Wyoming and southeastern Montana and consists of a large north-northwest trending asymmetric syncline, with the basin axis located to the west of the projects. The PRB is bounded by the Big Horn Mountains and Casper Arch to the west, the Black Hills to the east, and the Hartville Uplift and Laramie Mountains to the south. The PRB is filled with marine, non-marine and continental sediments ranging in age from early Paleozoic through Cenozoic.

Within the PRB, the Paleocene Fort Union Formation conformably overlies the Lance Formation and is a fluvial-sedimentary stratigraphic unit that consists of fine- to coarse-grained arkosic sandstone, which is interbedded with siltstone, mudstone and carbonaceous materials. In some areas of the PRB, the Fort Union Formation is divided into two members, identified as the Upper and Lower members of the Fort Union Formation. However, Flores divides the Fort Union into three members: the Tullock; Lebo; and Tongue River members (listed from oldest to youngest); as follows:

Uranium mineralization occurs in zones that are located in channel sands of the Fort Union Formation. These channel sands are typical fining upward sand sequences consisting of fine-grained sandstones. The zones of mineralization are formed as typical roll-front deposits in these sandstones.

The early Eocene Wasatch Formation unconformably overlies the Fort Union Formation around the margins of the PRB. However, the two formations are conformable and gradational towards the basin center. The relative amount of coarse, permeable clastics increases near the top of Fort Union, and the overlying Wasatch Formation contains numerous beds of sandstone that can sometimes be correlated over wide areas. The Wasatch-Fort Union contact is separated by Paleocene and Eocene rocks and is generally placed above the Roland coal. However, other authors have placed the Wasatch-Fort Union contact above the School, Badger and Anderson Coals in other parts of the PRB.

The Wasatch Formation occurs at the surface in the central PRB but has been mostly removed by erosion with only small, scattered outcrops still present in the southern PRB. The Wasatch Formation is also a fluvial sedimentary unit that consists of a series of silt to very coarse-grained gradational intervals in arkosic sandstone. The sandstone horizons in the Wasatch Formation are the host rocks for several uranium deposits in the central PRB. Within this area, mineralization is found in a 50- to 100-ft thick sandstone lens. On a regional scale, mineralization is localized and controlled by facies changes within this sandstone, including thinning of the sandstone unit, decrease in grain size and increase in clay and organic material content. The Wasatch Formation reaches a maximum thickness of about 1,600 ft and dips northwestward from one degree to two-and-a-half degrees in the southern and central parts of the PRB.

The Oligocene White River Formation overlies the Wasatch Formation and has been removed from most of the PRB by erosion. Remnants of this unit crop out on the Pumpkin Buttes, and at the extreme southern edge of the PRB. The White River Formation consists of clayey sandstone, claystone, a boulder conglomerate and tuffaceous sediments, which may be the primary source rock for uranium in the southern part of the PRB as a whole. The youngest sediments consist of Quaternary alluvial sands and gravels locally present in larger valleys. Quaternary eolian sands can also be found locally.

The Moore Ranch Project Area targets mineralization in the Eocene-aged Wasatch Formation.

Mineralization in the Moore Ranch Project Area occurs in fluvial sandstones of the lower parts of the Wasatch Formation. Most of the upper Wasatch Formation has been eroded away. The sandstones are arkosic, fine- to coarse-grained with local calcareous lenses. The sandstones contain minor amounts of organic carbon that occurs as dispersed bits or as stringers. Unaltered sandstones are generally gray, while altered sandstones are tan or pink due to hematite, or show yellowish coloring due to limonite.

Pyrite occurs in several forms within the host sandstones. In unaltered sandstones, pyrite occurs as small to large single euhedral crystals associated with magnetite, ilmenite and other dark detrital minerals. In altered sandstone, pyrite is typically absent, but locally occurs as tarnished, very fine-grained euhedral crystals. In areas of intense or heavy mineralization, pyrite locally occurs as massive, tarnished crystal aggregates.

Geology at the Moore Ranch Project Area is similar to the geology at the North and Southwest Reno Creek resource areas and includes the Felix and Badger coals. The mineralized host sand lies 5 to 30 ft below this coal bed and at a depth of 200–350 ft below the surface. The host sandstone is 80-150 ft thick.

Uranium mineralization at the Moore Ranch Project Area is typical of Wyoming roll-front sandstone deposits. The formation of roll-front deposits is largely a groundwater process that occurs when uranium-rich, oxygenated groundwater interacts with a reducing environment in the subsurface and precipitates uranium. The most favorable host rocks for roll-fronts are permeable sandstones with large aquifer systems. Interbedded mudstone, claystone and siltstone are often present and aid in the formation process by focusing groundwater flux. The geometry of mineralization is dominated by the classic roll-front “C” shape or crescent configuration at the redox interface. The highest-grade portion of the front occurs in a zone termed the “nose” within reduced ground just ahead of the alteration front. Ahead of the nose, at the leading edge of the solution front, mineral quality gradually diminishes to barren within the “seepage” zone. Trailing behind the nose, in oxidized (altered) ground, are weak remnants of mineralization referred to as “tails” which have resisted re-mobilization to the nose due to association with shale, carbonaceous material or other lithologies of lower permeability. Tails are generally not amenable to ISR because the uranium is typically found within strongly reduced or impermeable strata, therefore making it difficult to leach.

Data Verification

Data used for the resource estimate at the Moore Ranch Project Area consisted of drill maps, cross-sections, geophysical logs and lithologic logs developed by Conoco, a major US company, intent on developing the property as a production center. Standard industry methods were used at the time of data collection.

Paper records of historic radiometric data were input into a spreadsheet. Radiometric log interpretation was spot checked for the higher-grade intercepts.

Historic drill hole locations were verified by plotting their coordinates and checking against original maps. Historic drill hole location coordinates were then converted to match the North American Datum (“NAD”) 83 coordinate system for recent drill holes. Approximately 10% of the historic drill holes were resurveyed.

Recent drill hole data included collar elevation, collar location, grade and elevation of mineralized intercepts, bottom hole elevation and locations that had utilized modern survey grade GPS equipment.

Confirmation drilling by way of offset holes has been conducted by previous owners to validate historic data.

Since no historic core samples exist for verification, core drilling of the Moore Ranch Project Area was conducted in 2006 and 2008. The cores were assayed to verify historic data and two were used for leach testing.

WWC prepared an independent Canadian NI 43-101 technical report on resources for this Moore Ranch Project Area in April of 2019 (WWC, 2019a). The current resource estimate is based, in part, on that report.

Mineral Resource Estimates

The following key assumptions were used for resource estimates, unless otherwise noted:

The GT contour method was used to estimate resources at the Moore Ranch Project Area. The GT contour method is one of the most widely used and dependable methods to estimate resources in uranium roll-front deposits. The basis of the GT contour method is the GT (grade x mineralized thickness) values, which are determined for each drill hole using radiometric log results and a suitable GT cutoff, below which the GT value is considered to be zero. The GT values are then plotted on a drill hole map and GT contours are drawn accordingly using roll-front data derived from cuttings and the nature of the gamma anomalies. The resources are calculated from the area within the GT contour boundaries considering the DEF and the ore zone density.

The resource estimate methods, general parameters and mineralized cutoffs used at the Moore Ranch Project Area are summarized below.

Table 3: Moore Ranch Project Area Resource Estimate Methodology

Based on the depths of mineralization, average grade, thickness and GT, it is the TRS QP’s opinion that the mineral resources of the Moore Ranch Project Area can be recoverable by ISR methods using a long-term uranium price of $40/lb.

Uranium does not trade on the open market and many of the private sales contracts are not publicly disclosed. UEC used $40/lb as the forecast uranium price for the Moore Ranch Project Area. This is based on: (i) the long-term contract price at the end of February 2022, which was $43.88/lb from Cameco Resources’ combination of UxC and Trade Tech reports; (ii) the spot price at the end of February 2022 ($48.75/lb); (iii) UxC’s price forecast; and (iv) UEC’s understanding of market expectations. The table below contains the UxC uranium price forecast for Q4 of 2021.

Table 4: UxC Q4 2021 Uranium Price Forecast ($/lb U₃O₈)

In the opinion of the TRS QP, $40/lb is a conservative forecast price for the following reasons:

For the above reasons, the TRS QP also believes that a $40/lb price is considered reasonable by the QP for use in cutoff determination and to assess reasonable prospects for eventual economic extraction.

Measured, indicated and inferred resource classifications at the Moore Ranch Project Area are defined by the density of the drill hole data. Higher drill hole densities allow more confidence in the shape and size of the interpreted mineral horizons. The table below details the resource classification criteria used in the resource estimates in each of the Moore Ranch Project Area.

Table 5: Moore Ranch Project Area Drill Hole Information

There are numerous reasons that mineralization was interpreted as measured resources within the Moore Ranch Project Area:

This combination of drill hole spacing, well-known subsurface geology, well-understood deposit model, successful production and the variety of data collected led WWC, as the TRS QP, to conclude that the mineralization in areas with drill hole spacing tabulated above fit the definition for measured resources.

Mineral resources were estimated separately for the Moore Ranch Project Area. The estimates of measured and indicated mineral resources for the Moore Ranch Project Area are reported in the table below.

Table 6: Moore Ranch Project Area Measured and Indicated Mineral Resources

The estimates of inferred mineral resources are reported in the table below.

Table 7: Moore Ranch Project Area Inferred Mineral Resources

Details regarding the mineral resource estimate disclosed herein can be found in Chapter 11, Mineral Resource Estimates of the TRS.

Present Condition of Property and Work Completed to Date

The Moore Ranch Project Area is currently under care and maintenance with the license renewal process in public notice.

The Company’s Planned Work

The Company intends to continue to keep the Moore Ranch Project Area in a care and maintenance mode.

Reno Creek ISR Project

The following technical and scientific description for the Reno Creek Project Area (the “Reno Creek Project Area”) is based in part on the TRS titled “S-K 1300 Mineral Resource Report Wyoming Assets ISR Hub and Spoke Project, WY USA”, current on March 31, 2022, prepared by WWC, a qualified firm (the “QP” herein). The Reno Creek Project Area does not have mineral reserves and is therefore considered an exploration stage property under S-K 1300 definitions, despite a history of commercial production.

Property Description

The Reno Creek Project Area is in Campbell County, Wyoming, within the PRB. The Reno Creek Project Area covers 18,763 acres, including all (or portions of) 46 sections of the PRB.

The Reno Creek Project Area is approximately five miles to the northwest of the North and Southwest Reno Creek Resource Areas. The Pine Tree Resource Area lies approximately five miles to the southwest of the permitted resource areas, immediately southeast of the intersection of U.S. Highway 387 and Wyoming Highway 50, also known as Pine Tree Junction. The Bing Resource Area lies approximately five miles west of the permitted Resource Areas adjacent to Wyoming Highway 50, three miles north of Pine Tree Junction.

Figure 1: Map of UEC Project Areas

Ownership

This Reno Creek Project Area is owned and operated by UEC. UEC has executed surface use and access agreements and fee mineral leases with landowners who hold surface and mineral ownership within and outside the various Reno Creek Project Area boundaries. UEC also holds unpatented BLM lode claims and leases on Wyoming state land on the project area.

Mineral rights for the Reno Creek Project Area are a combination of federally administered minerals (unpatented lode claims), State of Wyoming mineral leases and (fee) private mineral leases. Federal mining claims were staked and recorded consistent with federal and state law, state mineral leases were obtained by submitting a lease application and appropriate fee to the State Board of Land Commissioners, and fee mineral leases were obtained through negotiation with individual mineral owners.

Table 1: Property Characteristics Summary

Within the Reno Creek Project Area, UEC holds four State of Wyoming uranium leases on state lands and 549 unpatented lode claims on federally (BLM) administered minerals. The BLM administers no surface rights at the Reno Creek Project Area, only mineral rights. UEC has 36 fee (private) mineral leases on the Reno Creek Project Area.

Payments for the state and private lease and BLM mining claim filing payments are up to date, as of the effective date of the TRS.

Accessibility, Climate, Local Resources, Infrastructure and Physiography

The Reno Creek Project Area is within Campbell County, Wyoming. This county resides in the Wyoming Basin Physiographic Province in the southern portion of the PRB. This site generally lies near the synclinal axis of the basin. The PRB is a part of the Northwestern Great Plains eco-region, a semiarid rolling plain of shale and sandstone punctuated by occasional buttes. Regional structural features also include the Big Horn Mountains to the west, Casper Arch to the south, and the Black Hills to the east. In the Reno Creek Project Area, the landscape is dominated by the Pumpkin Buttes.

Topography in the Reno Creek Project Area ranges from generally flat to gently rolling hills, with numerous drainages containing ephemeral streams dissecting the Reno Creek Project Area. Elevations ranges from approximately 4,500 to 5,400 ft above mean sea level.

Vegetation within the Reno Creek Project Area consists primarily of grassland, with areas of sagebrush. The Reno Creek Project Area lies within the mixed grass eco-region of the Northwestern Great Plains. Interspersed among these major vegetation communities, within and along the ephemeral drainages, are grassland and meadow grassland and less abundant types of seeded grasslands (improved pastures).

The Reno Creek Project Area in the PRB is located in a semi-arid or steppe climate. The region is characterized by cold, harsh winters and hot, dry summers. The spring season is relatively warm and moist, and autumns are cool. Temperature extremes range from roughly -25° F in the winter to 100° F in the summer. Typically, the “last freeze” occurs during late May and the “first freeze” occurs in mid- to late September.

Yearly precipitation in the PRB averages about 13 inches. The PRB is prone to severe thunderstorm events throughout the spring and early summer months, and much of the precipitation is attributed to these events. Snow falls throughout the winter months (approximately 40 to 50 inches per year), but provides much less moisture than rain events.

The nearest community to the Reno Creek Project Area is Wright, Wyoming, a small, incorporated town with a population of 1,644 at the junction of Wyoming Highway 387 and Wyoming Highway 59. Gillette is a major local population center with a population of 33,403 and a regional airport. Gillette is located along Interstate 90, north and east of the Reno Creek Project Area via both Wyoming Highway 59 (due north of Wright) and Wyoming Highway 50. The towns of Edgerton and Midwest are in Natrona County, approximately 20 to 30 miles southwest of the Reno Creek Project Area on Wyoming Highway 387.

A major north–south railroad, BNSF Railway, used primarily for transporting coal, lies east of the Reno Creek Project Area and parallel to Wyoming Highway 59.

Equipment and supplies needed for exploration and day-to-day operations are available from population centers such as Gillette and Casper. Specialized equipment for the wellfields will likely need to be acquired from outside of Wyoming.

The local economy is geared toward coal mining and oil and gas production as well as ranching operations, providing a well-trained and capable pool of workers for ISR production and processing operations. Workers will reside locally and commute to work daily.

As a result of energy development over the past 50 years, the Reno Creek Project Area has existing or nearby (less than two miles) electrical power, gas and adequate telephone and internet connectivity.

UEC owns 40 acres of land near the intersection of Wyoming State Highway 387 and the Clarkelen County Road to build and operate a future satellite facility. This land is equipped with a warehouse and office, power, telephone, water tank and domestic waste disposal. A well will be drilled to provide potable water for the Reno Creek Project Area.

History

Uranium was first discovered in the southern PRB during the early 1950s. By the mid- to late 1950s, small open pit mine operations were established in the PRB. Early prospecting and exploration included geologic mapping and gamma surveys, which led to discoveries of uranium in the Wasatch and Fort Union Formations. Extensive drill hole exploration has been utilized to locate deeper uranium mineralization since the 1960s to progress geologic models.

The table below describes the historic ownership and operations at the Reno Creek Project Area.

Table 2: Historic Ownership and Operations at the Reno Creek Project Area

Permitting and Licensing

The Reno Creek Project Area is fully permitted through the WDEQ/LQD.

Geologic Setting, Mineralization, and Deposit

The Reno Creek Project Area resides in the PRB. The PRB extends over much of northeastern Wyoming and southeastern Montana and consists of a large north-northwest trending asymmetric syncline, with the basin axis located to the west of the projects. The PRB is bounded by the Big Horn Mountains and Casper Arch to the west, the Black Hills to the east and the Hartville Uplift and Laramie Mountains to the south. The PRB is filled with marine, non-marine and continental sediments ranging in age from early Paleozoic through Cenozoic.

Within the PRB, the Paleocene Fort Union Formation conformably overlies the Lance Formation and is a fluvial-sedimentary stratigraphic unit that consists of fine- to coarse-grained arkosic sandstone, which is interbedded with siltstone, mudstone and carbonaceous materials. In some areas of the PRB, the Fort Union Formation is divided into two members, identified as the Upper and Lower members of the Fort Union Formation. However, Flores divides the Fort Union into three members: the Tullock; Lebo; and Tongue River members (listed from oldest to youngest); as follows:

Uranium mineralization occurs in zones that are located in channel sands of the Fort Union Formation. These channel sands are typical fining upward sand sequences consisting of fine-grained sandstones. The zones of mineralization are formed as typical roll-front deposits in these sandstones.

The early Eocene Wasatch Formation unconformably overlies the Fort Union Formation around the margins of the PRB. However, the two formations are conformable and gradational towards the basin center. The relative amount of coarse, permeable clastics increases near the top of Fort Union, and the overlying Wasatch Formation contains numerous beds of sandstone that can sometimes be correlated over wide areas. The Wasatch-Fort Union contact is separated by Paleocene and Eocene rocks and is generally placed above the Roland coal. However, other authors have placed the Wasatch-Fort Union contact above the School, Badger and Anderson Coals in other parts of the PRB.

The Wasatch Formation occurs at the surface in the central PRB but has been mostly removed by erosion with only small, scattered outcrops still present in the southern PRB. The Wasatch Formation is also a fluvial sedimentary unit that consists of a series of silt to very coarse-grained gradational intervals in arkosic sandstone. The sandstone horizons in the Wasatch Formation are the host rocks for several uranium deposits in the central PRB. Within this area, mineralization is found in a 50- to 100-ft thick sandstone lens. On a regional scale, mineralization is localized and controlled by facies changes within this sandstone, including thinning of the sandstone unit, decrease in grain size and increase in clay and organic material content. The Wasatch Formation reaches a maximum thickness of about 1,600 ft and dips northwestward from one degree to two-and-a-half degrees in the southern and central parts of the PRB.

The Oligocene White River Formation overlies the Wasatch Formation and has been removed from most of the PRB by erosion. Remnants of this unit crop out on the Pumpkin Buttes, and at the extreme southern edge of the PRB. The White River Formation consists of clayey sandstone, claystone, a boulder conglomerate and tuffaceous sediments, which may be the primary source rock for uranium in the southern part of the PRB as a whole. The youngest sediments consist of Quaternary alluvial sands and gravels locally present in larger valleys. Quaternary eolian sands can also be found locally.

The Reno Creek Project Area targets mineralization in the Eocene-aged Wasatch Formation.

Mineralization in the Reno Creek Project Area occurs in fluvial sandstones of the lower parts of the Wasatch Formation. Most of the upper Wasatch Formation has been eroded away. The sandstones are arkosic, fine- to coarse-grained with local calcareous lenses. The sandstones contain minor amounts of organic carbon that occurs as dispersed bits or as stringers. Unaltered sandstones are generally gray, while altered sandstones are tan or pink due to hematite, or show yellowish coloring due to limonite.

Pyrite occurs in several forms within the host sandstones. In unaltered sandstones, pyrite occurs as small to large single euhedral crystals associated with magnetite, ilmenite and other dark detrital minerals. In altered sandstone, pyrite is typically absent, but locally occurs as tarnished, very fine-grained euhedral crystals. In areas of intense or heavy mineralization, pyrite locally occurs as massive, tarnished crystal aggregates.

At the Reno Creek Project Area, the Felix Coal seams are laterally continuous in the North and Southwest Reno Creek resource areas and extend northward into the Moore and Bing resource areas. The Felix Coal seams and the underlying Badger Coal seam provide important correlation points across the Reno Creek Project Area. Sandstone horizons that host uranium mineralization within the production zone aquifer are typically cross-bedded, graded sequences fining upward from very coarse-grained at the base to fine-grained at the top, representing sedimentary cycles from 5-20 ft thick. Stacking of depositional cycles resulted in sandstone body accumulations over 200 ft thick.

Uranium mineralization at the Reno Creek Project Area is typical of Wyoming roll-front sandstone deposits. The formation of roll-front deposits is largely a groundwater process that occurs when uranium-rich, oxygenated groundwater interacts with a reducing environment in the subsurface and precipitates uranium. The most favorable host rocks for roll-fronts are permeable sandstones with large aquifer systems. Interbedded mudstone, claystone and siltstone are often present and aid in the formation process by focusing groundwater flux. The geometry of mineralization is dominated by the classic roll-front “C” shape or crescent configuration at the redox interface. The highest-grade portion of the front occurs in a zone termed the “nose” within reduced ground just ahead of the alteration front. Ahead of the nose, at the leading edge of the solution front, mineral quality gradually diminishes to barren within the “seepage” zone. Trailing behind the nose, in oxidized (altered) ground, are weak remnants of mineralization referred to as “tails” which have resisted re-mobilization to the nose due to association with shale, carbonaceous material or other lithologies of lower permeability. Tails are generally not amenable to ISR because the uranium is typically found within strongly reduced or impermeable strata, therefore making it difficult to leach.

Data Verification

WWC prepared an independent TRS titled “S-K 1300 Initial Assessment Mineral Resource Report Reno Creek Project Campbell County, WY USA”, which was completed and was current on March 31, 2022. That TRS details the resource estimate data verification for the Reno Creek Project Area. A summary of the data verification found in that TRS is provided below.

The UEC database contains 10,151 drill holes drilled by RCH and other former operators on and adjacent to the resource areas. Electric log gamma data are available for more than 75% of these holes, and interval data (thickness, grade, and grade-thickness) are available for about 95% of the mineralized holes.

Approximately 50 drill holes were not used in the current resource estimate due to identification of problematic data during recent data validation processes.

Data for 6,191 drill holes were used in the current resource estimate; however, more or less all of the holes supported geological model construction, so essentially all holes were used to support mineral resource estimation. Within the data set, 6,061 holes are within the Reno Creek Project Area. The drill hole data consists of logs, surveys and data generated for those holes.

UEC personnel entered the data into the database and constantly monitored data quality during data entry and when data are extracted for any purposes.

As previously discussed, industry standard methods were utilized at the time of data collection. Available data were from drill maps, cross sections, geophysical logs and lithologic logs. WWC has worked with UEC contacts to obtain and verify exploration drilling and sampling data was complete, thorough and accurate. Geophysical logs for historic drill holes were analyzed and evaluated for completeness and sufficiently quality check in the process of developing the drill hole database for the resource modeling. Surveyed monuments or markers documenting the location of abandoned drill holes were not able to be physically inspected during the site visit, however, the database of drill hole locations was checked against the hole location identified on geophysical logs.

Mineral Resource Estimates

The following key assumptions were used for resource estimates, unless otherwise noted:

The estimation method was a two-dimensional (2D) Delaunay Triangulation implemented in RockWorks, a comprehensive software program for creating 2D and 3D maps and is an industry standard in the environmental, geotechnical, petroleum and mining industries. The Delaunay Triangulation method connects data points (drill holes) via a triangular network with one data point at each triangle vertex and constructs the triangles as close to equilateral as possible. Once the network was determined, the slope of each triangular plate was computed using the three vertex point values. Next, a 25 ft x 25 ft grid was superimposed over the triangular network, and each grid node (grid center) was assigned a Z-value, based on the intercept of the node and the sloping triangular plate. Only grid nodes falling within the boundary of the triangular network (convex hull) were estimated. The distance of the grid node from a drill hole location was computed and used to determine whether the node was located within UEC’s property boundary. Triangulations and grids for both grade and thickness were constructed. Next, the thickness and grade grids were multiplied to obtain a GT grid. Finally, the mineral resource classification criteria was applied to the GT grid to obtain a classified mineral resource. Resource pounds were determined by taking the average GT in each GT contour interval and multiplying it by the area and a conversion factor, then dividing that value by the tonnage factor. The resource estimate methods, general parameters and mineralized cutoffs used at the Reno Creek Project Area are summarized below.

Table 3: Reno Creek Project Area Resource Estimate Methodology

Based on the depths of mineralization, average grade, thickness and GT, it is the TRS QP’s opinion that the mineral resources of the Reno Creek Project Area can be recoverable by ISR methods using a long-term uranium price of $40/lb.

Uranium does not trade on the open market and many of the private sales contracts are not publicly disclosed. UEC used $40/lb as the forecast uranium price for the Reno Creek Project Area. This is based on: (i) the long-term contract price at the end of February 2022, which was $43.88/lb from Cameco Resources’ combination of UxC and Trade Tech reports (Cameco, 2022); (ii) the spot price at the end of February 2022 ($48.75/lb); (iii) UxC’s price forecast; and (iv) UEC’s understanding of market expectations. The table below contains the UxC uranium price forecast for Q4 of 2021.

Table 4: UxC Q4 2021 Uranium Price Forecast ($/lb U3O8)

In the opinion of the TRS QP, $40/lb is a conservative forecast price for the following reasons:

For the above reasons, the TRS QP also believes that a $40/lb price is considered reasonable by the QP for use in cutoff determination and to assess reasonable prospects for eventual economic extraction.

Measured, indicated and inferred resource classifications at the Reno Creek Project Area are defined by the density of the drill hole data. Higher drill hole densities allow more confidence in the shape and size of the interpreted mineral horizons. The table below details the resource classification criteria used in the resource estimates in each of the Reno Creek Project Area.

Table 5: Reno Creek Project Area Drill Hole Information

There are numerous reasons that mineralization was interpreted as measured resources within the Reno Creek Project Area:

This combination of drill hole spacing, well-known subsurface geology, well-understood deposit model, successful production and the variety of data collected led WWC, as the TRS QP, to conclude that the mineralization in areas with drill hole spacing tabulated above fit the definition for measured resources.

Mineral resources were estimated separately for the Reno Creek Project Area. The estimates of measured and indicated mineral resources for the Reno Creek Project Area are reported in the table below and the estimates of inferred mineral resources are reported in the table following.

Table 6: Reno Creek Project Area Measured and Indicated Mineral Resources

Table 7: Reno Creek Project Area Inferred Mineral Resources

Details regarding the mineral resource estimate disclosed herein can be found in Chapter 11, Mineral Resource Estimates of the TRS.

Present Condition of Property and Work Completed to Date

The Reno Creek Project Area is currently under care and maintenance with additional areas currently being added to the Reno Creek Project Area through the amendment process overseen by the state of Wyoming.

The Company’s Planned Work

The Company plans to complete permit and license amendments to add new mineable acreage to the Reno Creek Project Area. Drilling plans are also in the initial stages of development.

Ludeman ISR Project

The following technical and scientific description for the Ludeman Project (the “Ludeman Project Area”) is based in part on the TRS titled “S-K 1300 Mineral Resource Report Wyoming Assets ISR Hub and Spoke Project, WY USA”, current on March 31, 2022, prepared by WWC, a qualified firm (the “QP” herein). The Ludeman Project Area does not have mineral reserves and is therefore considered an Exploration Stage property under S-K 1300 definitions, despite a history of successful in situ research and development testing.

Property Description

The Ludeman Project Area is located in Converse County, Wyoming, in the southern portion of the PRB. The Ludeman Project Area covers 19,888 acres including all (or portions of) 31 sections of the PRB.

The Ludeman Project Area is located approximately 12 miles northeast of Glenrock and 30 miles east-northeast of Casper, Wyoming. State Highway 95 provides access to the Ludeman Project Area from the Towns of Glenrock and Rolling Hills to the west and State Highway 93 provides access from Douglas to the southeast. Interstate 25 provides access to both of these state highways from the south of the Ludeman Project Area. The Ludeman Project Area is primarily located on private surface land with some areas of Federal or state lands.

Figure 1: Map of UEC Project Areas

Ownership

This Ludeman Project Area is owned and operated by UEC. UEC has executed surface use and access agreements and fee mineral leases with landowners who hold surface and mineral ownership within and outside the various Ludeman Project Area boundaries. UEC also holds unpatented BLM lode claims and leases on Wyoming state land on the Ludeman Project Area.

Mineral rights for the Ludeman Project Area are a combination of federally administered minerals (unpatented lode claims), State of Wyoming mineral leases and private (fee) mineral leases. Federal mining claims were staked and recorded consistent with federal and state law, state mineral leases were obtained by submitting a lease application and appropriate fee to the State Board of Land Commissioners, and fee mineral leases were obtained through negotiation with individual mineral owners.

Table 1: Property Characteristics Summary

Within the Ludeman Project Area, UEC holds four State of Wyoming uranium leases on state lands with a combined acreage of 1,440 acres. UEC also holds 746 unpatented lode claims on federally administered minerals. An additional two fee mineral leases are held with private mineral owners. In total, the project mineral holdings total approximately 20,768 acres in the Ludeman Project Area.

Payments for state and private leases and BLM mining claim filing payments are up to date, as of the effective date of the TRS.

Accessibility, Climate, Local Resources, Infrastructure and Physiography

The Ludeman Project Area is within Converse County, Wyoming. This county resides in the Wyoming Basin Physiographic Province in the southern portion of the PRB. This site generally lies near the synclinal axis of the basin. The PRB is a part of the Northwestern Great Plains eco-region, a semi-arid rolling plain of shale and sandstone punctuated by occasional buttes. Regional structural features also include the Big Horn Mountains to the west, Casper Arch to the south, and the Black Hills to the east. In the Ludeman Project Area, the landscape is dominated by the Pumpkin Buttes.

Topography in the Ludeman Project Area ranges from generally flat to gently rolling hills, with numerous drainages containing ephemeral streams dissecting the Ludeman Project Area. Elevations ranges from approximately 4,500 to 5,400 ft above mean sea level.

Vegetation within the Ludeman Project Area consists primarily of grassland, with areas of sagebrush. The Ludeman Project Area lies within the mixed grass eco-region of the Northwestern Great Plains. Interspersed among these major vegetation communities, within and along the ephemeral drainages, are grassland and meadow grassland and less abundant types of seeded grasslands (improved pastures).

The Ludeman Project Area in the PRB is located in a semi-arid or steppe climate. The region is characterized by cold, harsh winters and hot, dry summers. The spring season is relatively warm and moist, and autumns are cool. Temperature extremes range from roughly -25° F in the winter to 100° F in the summer. Typically, the “last freeze” occurs during late May and the “first freeze” occurs in mid- to late September.

Yearly precipitation in the PRB averages about 13 inches. The PRB is prone to severe thunderstorm events throughout the spring and early summer months, and much of the precipitation is attributed to these events. Snow falls throughout the winter months (approximately 40 to 50 inches per year), but provides much less moisture than rain events.

Equipment and supplies needed for exploration and day-to-day operations are available from population centers such as Douglas, Glenrock and Casper. Specialized equipment for the wellfields will likely need to be acquired from outside of Wyoming.

The local economy is geared toward coal mining and oil and gas production as well as ranching operations, providing a well-trained and capable pool of workers for ISR production and processing operations. Workers will reside locally and commute to work daily.

As a result of energy development over the past 50 years, all the Ludeman Project Area have existing or nearby (less than two miles) electrical power, gas and adequate telephone and internet connectivity.

The Ludeman Project Area has been historically used for livestock grazing. Nearby uranium operations have occurred historically. Non-potable water will be supplied by wells developed on or near the Ludeman Project Area. Water extracted as part of ISR operations will be recycled for reinjection. Ponds are the primary permitted wastewater disposal method at the Ludeman Project Area. However, typical ISR mining operations use disposal wells, which are permitted as a secondary wastewater disposal method at the Ludeman Project Area. The proximity of the Ludeman Project Area to paved roads will facilitate transportation of equipment, supplies, personnel and products. High voltage transmission lines from the Dave Johnston Power Plant pass within the Ludeman Project Area.

History

Uranium was first discovered in the southern PRB during the early 1950s. By the mid- to late 1950s, small open pit mine operations were established in the PRB. Early prospecting and exploration included geologic mapping and gamma surveys, which led to discoveries of uranium in the Wasatch and Fort Union Formations. Extensive drill hole exploration has been utilized to locate deeper uranium mineralization since the 1960s to progress geologic models.

The table below describes the historic ownership and operations at the Ludeman Project Area.

Permitting and Licensing

The Ludeman Project Area is fully permitted through the WDEQ/LQD.

Geologic Setting, Mineralization, and Deposit

The Ludeman Project Area resides in the PRB. The PRB extends over much of northeastern Wyoming and southeastern Montana and consists of a large north-northwest trending asymmetric syncline, with the basin axis located to the west of the projects. The PRB is bounded by the Big Horn Mountains and Casper Arch to the west, the Black Hills to the east and the Hartville Uplift and Laramie Mountains to the south. The PRB is filled with marine, non-marine and continental sediments ranging in age from early Paleozoic through Cenozoic.

Within the PRB, the Paleocene Fort Union Formation conformably overlies the Lance Formation and is a fluvial-sedimentary stratigraphic unit that consists of fine- to coarse-grained arkosic sandstone, which is interbedded with siltstone, mudstone and carbonaceous materials. In some areas of the PRB, the Fort Union Formation is divided into two members, identified as the Upper and Lower members of the Fort Union Formation. However, Flores divides the Fort Union into three members: the Tullock; Lebo; and Tongue River members (listed from oldest to youngest); as follows:

The total thickness of the Fort Union Formation varies between 2,000 and 3,500 ft.

Uranium mineralization occurs in zones that are located in channel sands of the Fort Union Formation. These channel sands are typical fining upward sand sequences consisting of fine-grained sandstones. The zones of mineralization are formed as typical roll-front deposits in these sandstones.

The early Eocene Wasatch Formation unconformably overlies the Fort Union Formation around the margins of the PRB. However, the two formations are conformable and gradational towards the basin center. The relative amount of coarse, permeable clastics increases near the top of Fort Union, and the overlying Wasatch Formation contains numerous beds of sandstone that can sometimes be correlated over wide areas. The Wasatch-Fort Union contact is separated by Paleocene and Eocene rocks and is generally placed above the Roland coal. However, other authors have placed the Wasatch-Fort Union contact above the School, Badger and Anderson Coals in other parts of the PRB.

The Wasatch Formation occurs at the surface in the central PRB, but has been mostly removed by erosion with only small, scattered outcrops still present in the southern PRB. The Wasatch Formation is also a fluvial sedimentary unit that consists of a series of silt to very coarse-grained gradational intervals in arkosic sandstone. The sandstone horizons in the Wasatch Formation are the host rocks for several uranium deposits in the central PRB. Within this area, mineralization is found in a 50- to 100-ft thick sandstone lens. On a regional scale, mineralization is localized and controlled by facies changes within this sandstone, including thinning of the sandstone unit, decrease in grain size and increase in clay and organic material content. The Wasatch Formation reaches a maximum thickness of about 1,600 ft and dips northwestward from one degree to two-and-a-half degrees in the southern and central parts of the PRB.

The Oligocene White River Formation overlies the Wasatch Formation and has been removed from most of the PRB by erosion. Remnants of this unit crop out on the Pumpkin Buttes, and at the extreme southern edge of the PRB. The White River Formation consists of clayey sandstone, claystone, a boulder conglomerate and tuffaceous sediments, which may be the primary source rock for uranium in the southern part of the PRB as a whole. The youngest sediments consist of Quaternary alluvial sands and gravels locally present in larger valleys. Quaternary eolian sands can also be found locally.

The Ludeman Project Area targets mineralization in the Fort Union Formation, which underlies the Wasatch Formation. The host rocks for the uranium ore deposits in the project areas are the arkosic sandstones of the Fort Union Formation. These channel deposits are confined by mudstones that serve as aquitards to the water saturated aquifers.

Uranium mineralization at the Ludeman Project Area is typical of Wyoming roll-front sandstone deposits. The formation of roll-front deposits is largely a groundwater process that occurs when uranium-rich, oxygenated groundwater interacts with a reducing environment in the subsurface and precipitates uranium. The most favorable host rocks for roll-fronts are permeable sandstones with large aquifer systems. Interbedded mudstone, claystone and siltstone are often present and aid in the formation process by focusing groundwater flux. The geometry of mineralization is dominated by the classic roll-front “C” shape or crescent configuration at the redox interface. The highest-grade portion of the front occurs in a zone termed the “nose” within reduced ground just ahead of the alteration front. Ahead of the nose, at the leading edge of the solution front, mineral quality gradually diminishes to barren within the “seepage” zone. Trailing behind the nose, in oxidized (altered) ground, are weak remnants of mineralization referred to as “tails” which have resisted re-mobilization to the nose due to association with shale, carbonaceous material or other lithologies of lower permeability. Tails are generally not amenable to ISR because the uranium is typically found within strongly reduced or impermeable strata, therefore making it difficult to leach.

Data Verification

Data used for the resource estimate at the Ludeman Project Area consisted of drill maps, cross-sections, geophysical logs, lithologic logs, reports and digital databases. Standard industry methods were used at the time of data collection.

Historic radiometric data log interpretation was spot checked for the higher-grade intercepts.

Historic drill hole locations were verified by plotting their coordinates and checking against original maps. Historic drill hole location coordinates were then converted to match the NAD 83 coordinate system for recent drill holes. Approximately 10% of the historic drill holes were resurveyed.

Recent drill hole data included collar elevation, collar location, grade and elevation of mineralized intercepts, bottom hole elevation and locations that had utilized modern survey grade GPS equipment.

Confirmation drilling by way of offset holes has been conducted by previous owners to validate historic data.

The Ludeman Project Area has been host to two successful pilot plant studies. The Leuenberger Pilot was in production for 12 months from two wellfields which recovered a combined 14,600 lbs U3O8. Recovery rates in the two wellfields were 68 percent and 27 percent of estimated in-place resources, and peak head grades were 175 ppm and 32 ppm (UNC Teton-Nedco, 1983). The North Platte Pilot was in production for five months with total recovery of 1,515 lbs of U3O8 at a recovery rate of 27 percent. Baseline investigations for a third pilot study were conducted by the APS Commission; however, actual pilot scale production was never conducted. Laboratory leach testing noted that the overall recovery averaged 76 percent of estimated in-place resource.

Mineral Resource Estimates

The following key assumptions were used for resource estimates, unless otherwise noted

The GT contour method was used to estimate the mineral resources at the Ludeman Project Area. The GT contour method is one of the most widely used and dependable methods to estimate resources in uranium roll-front deposits. The basis of the GT contour method is the GT (grade x mineralized thickness) values, which are determined for each drill hole using radiometric log results and a suitable GT cutoff, below which the GT value is considered to be zero.

The GT values are then plotted on a drill hole map and GT contours are drawn accordingly using roll-front data derived from cuttings and the nature of the gamma anomalies. The resources are calculated from the area within the GT contour boundaries considering the DEF and the ore zone density.

The resource estimate methods, general parameters and mineralized cutoffs used at the Ludeman Project Area are summarized below.

Table 3: Ludeman Project Area Resource Estimate Methodology

Based on the depths of mineralization, average grade, thickness and GT, it is the TRS QP’s opinion that the mineral resources of the Ludeman Project Area can be recoverable by ISR methods using a long-term uranium price of $40/lb.

Uranium does not trade on the open market and many of the private sales contracts are not publicly disclosed. UEC used $40/lb as the forecast uranium price for the Ludeman Project Area. This is based on: (i) the long-term contract price at the end of February 2022, which was $43.88/lb from Cameco Resources’ combination of UxC and Trade Tech reports (Cameco, 2022); (ii) the spot price at the end of February 2022 ($48.75/lb); (iii) UxC’s price forecast; and (iv) UEC’s understanding of market expectations. The table below contains the UxC uranium price forecast for Q4 of 2021.

Table 4: UxC Q4 2021 Uranium Price Forecast ($/lb U3O8)

In the opinion of the TRS QP, $40/lb is a conservative forecast price for the following reasons:

For the above reasons, the TRS QP also believes that a $40/lb price is considered reasonable by the QP for use in cutoff determination and to assess reasonable prospects for eventual economic extraction.

Measured, indicated and inferred resource classifications at the Ludeman Project Area are defined by the density of the drill hole data. Higher drill hole densities allow more confidence in the shape and size of the interpreted mineral horizons. The table below details the resource classification criteria used in the resource estimates in each of the Ludeman Project Area.

Table 5: Ludeman Project Area Drill Hole Information

There are numerous reasons that mineralization was interpreted as measured resources within the Ludeman Project Area: