Uranium Resources, Inc. Reviews 2010 and
Outlines Strategic
Initiatives for 2011
LEWISVILLE, TX, February 14, 2011 --- Uranium
Resources, Inc. (NASDAQ: URRE) (URI), today provided an update on the
Company�s activities, its liquidity position as of December 31, 2010 and its
strategy and outlook for 2011.
Excellent Progress in 2010 Set
the Stage for Future Growth and Expansion
Texas
Properties and Progress
- The
Company has focused on reclamation activities in Texas since its two
remaining operating wellfields were fully depleted in June 2009.
- Kingsville
Dome (KVD): Treated over 250 million gallons of groundwater,
completing restoration in PA1 and PA2 which should move to stabilization
testing in Q2. Full scale restoration has begun at the remaining KVD
production area.
- Rosita:
Both production areas completed restoration and remained in stabilization
throughout 2010 and documents have been filed with the state of Texas to
allow for release.
- Vasquez:
Completed restoration in PA2 and converted to stabilization phase. Began restoration in PA1 which should be completed in 2012.
- Payment
of $1.375 million was made late January as final action on a settlement
made in October 2010 of a two-year-old lawsuit regarding a lease agreement
in Texas. The settlement eliminated costly legal fees and risk of
higher royalty claims while enabling future potential discussions on
additional properties with an estimated 250,000 pounds of in-place
mineralized uranium material.
- URI
signed a non-binding letter of intent with Power Resources, Inc.
d/b/a Cameco Resources (CR), a subsidiary of Cameco (NYSE: CCJ), in the
latter part of 2010 with the expectation that they would jointly explore a
new green field site in South Texas. On January 3, 2011, URI took an
important step in its strategy to expand its resource base in Texas with
the announcement that it completed a three-year agreement to explore
53,500 acres in Kenedy County, with an option to lease the acreage for
uranium production. The property is located within the prolific
South Texas uranium district and based on water sampling tests, is
expected to yield uranium deposits that can be produced by in-situ technology.
Don Ewigleben, President and CEO of Uranium Resources,
commented, �During 2010, we reset our strategy to recognize the value of our
processing facilities in Texas and laid out a plan to identify opportunities to
explore for and develop resources in that region. We successfully
acquired what we believe is an ideal property lease that has strong indications
for uranium potential. Additionally, we are nearing completion of the
agreements with our prospective partner which provide us the financial means to
explore and develop the property and, assuming we do discover sufficient,
producible uranium, the toll milling agreement to capitalize on our processing
plants, in keeping with our strategic objective."
New
Mexico Activities
- Two
remaining litigation cases that delayed URI�s progress in New Mexico were
cleared in 2010. No petitions were filed by the deadline to review the
June 2010 United States Court of Appeals for the 10th Circuit en banc
ruling that URI�s Section 8 property in Churchrock, New Mexico is not
Indian Country, thus affirming the authority of the State of New Mexico to
issue the underground injection-control permit, which was granted to URI
in 1989. With the second case, the opponents petition to the United
States Supreme Court for review of the March 2010, 10th Circuit Court of
Appeals� ruling that upheld the Company�s NRC license to conduct in-situ
recovery uranium mining at the Churchrock/Crownpoint project was denied.
- In
October 2010, URI submitted the necessary documents to the U.S. Nuclear
Regulatory Commission to reactivate its NRC License. The
process is ongoing, awaiting determination from the Commission, and once
active, the license may be utilized according to its present terms and
conditions while pending renewal from the NRC.
- URI
completed drilling on its Section 13 property in Ambrosia Lake in
September 2010. The purpose for the drilling was to categorize the
property based on the best mining method for the resource. A
third-party laboratory analysis of the approximately 70 feet of cores
recovered from its Ambrosia Lake property showed low organic carbons,
which, in URI's opinion, indicates that some of the 860,000 pounds of
in-place mineralized material at this property may be amenable to in situ
recovery (ISR) mining. This property would require licensing and
permitting and is much lower in priority than the Company�s Church
Rock/Crownpoint project.
Mr. Ewigleben noted, "We made considerable
progress in New Mexico this last year and have detailed the progressive actions
necessary to move our Churchrock property toward production in 2013. With
101.4 million pounds of in place mineralized uranium material, the
eighth-largest known uranium resource base in the world, New Mexico is clearly
our premier location. We believe we have a significant advantage in that
region and are pursuing opportunities to increase our assets and build greater
value for our shareholders."
Liquidity Position Significantly
Improved in 2010
- During
2010, the Company completed two successful common stock offerings,
including the exercise of the over-allotment options, raising $10.4
million in the second quarter and $9.0 million in the fourth
quarter. This capital enabled URI to further its strategy of
building its asset base in Texas and advancing its properties in New
Mexico toward production.
- Cash at
December 31, 2010 was $15.4 million compared with $10.5 million at the end
of the trailing third quarter and $6.1 million at the end of 2009.
- Subsequent
to the end of 2010, URI paid $1.0 million for the execution of the South
Texas land exploration and lease option agreement, and expects to be
reimbursed $0.3 million by its prospective joint venture partner after the
signing of an exploration agreement.
2011 Plans Focused on Advancing
Texas and New Mexico Properties
URI�s objectives in Texas are to explore for and
develop a larger reserve base, advance current properties through licensing and
permitting, lease additional targeted properties and work with its customers to
redefine the terms of its sales agreements to enable better margins and greater
likelihood of returning to production in Texas.
- URI is
nearing completion of an exploration agreement with the global leader in
uranium production; the agreement also entails operating and toll milling
agreements. The exploration agreement will provide for a
three-phase, three-year exploration program, funded by the partner who has
the option to earn up to 70% of the property rights. URI is expected
to be the operator of the site and the uranium would be processed at URI�s
Kingsville Dome or Rosita processing facility under the toll milling agreement.
URI expects to commence exploration drilling in the second quarter of 2011.
- The
Company plans to advance certain properties in Texas toward production,
although given current sales contracts, uranium pricing, and the less than
lucrative nature of the resources available for production, the Company
does not expect at this time to return to production in Texas in
2011. Currently, there are about 400,000 identified recoverable
pounds of in place uranium that would take two to three years to produce.
These resources are relatively costly to produce at an estimated $48 per
pound.
URI�s focus in New Mexico is on the completion of its
feasibility study which it plans to complete at the end of 2011. It
expects that it will be able to report preliminary concepts regarding its
priority production property, Church Rock Section 8, and its processing
facility plans early in the third quarter of 2011.
- The
feasibility study will provide project parameters, costs, and equipment
and personnel requirements to begin production at Churchrock
Section 8. The evaluation includes wellfields,
satellite plant and a central processing plant at Crownpoint.
Outcome will also include the definition of project timelines, financial
requirements and milestones.
- The
feasibility study will also evaluate the Company�s conventional mining
properties, which currently make up approximately 55% of the 101.4 million
pounds of in-place mineralized uranium material in New Mexico. URI
believes it is prudent to evaluate the cost and timing associated with
advancing the conventional properties forward so that it is in a position
to evaluate proposals and partnerships in conjunction with New Mexico�s
vast uranium resource base. Conventional mining processes would take
several years longer than ISR mining, so early initial planning is
required in order to be prepared for five and ten years from now.
- URI
plans to be in a position to begin construction of its Church
Rock/Crownpoint ISR wellfield and processing facilities in 2012 and
production in 2013 assuming that all permits and licenses are in place,
that there is a sustained recovery in uranium prices and financing is
available for the necessary capital expenditures to build the
infrastructure.
- URI
holds the necessary NRC License, EPA Aquifer Exemption, State of New
Mexico Water Rights and Underground Injection Control Permit to allow
Church Rock Section 8 development to begin in January 2012.
Mr. Ewigleben concluded, �2011 looks to be another
year of significant advancement for URI. We will be quite intensely
involved in our exploration activities in Texas, the feasibility study in New
Mexico and continuing our efforts to consolidate assets in New Mexico.
Given general expectations for uranium pricing over the long tem and the opportunities
that we see on the horizon with our efforts in both states, we believe the next
several years should demonstrate momentous progress for the
Company.�
Teleconference and Webcast
The Company is hosting a conference call and webcast
today at 1:30 p.m. ET. During the call, management will provide an update
on URI�s strategies, outlook, and
progress in advancing its Texas and New Mexico properties. A
question-and-answer session will follow.
The URI
conference call can be accessed by dialing (201) 689-8562 and entering
conference ID number 366232. The live listen-only audio webcast can be
monitored on the Company�s website at www.uraniumresources.com, where it will be archived afterwards. To listen to the archived
call, dial
(858) 384-5517, andenter conference ID number 366232. The replay will be
available from 4:30 p.m. ET the day of the teleconference until 11:59 p.m. ET
Monday, February 21, 2011.
A transcript will also be placed on the Company�s
website, once available.
About Uranium Resources, Inc.
Uranium Resources Inc. explores for, develops and mines uranium. Since
its incorporation in 1977, URI has produced over 8 million pounds of uranium by
in-situ recovery (ISR) methods in the state of Texas where the Company
currently has ISR mining projects. URI also has 183,000 acres of uranium
mineral holdings and 101.4 million pounds of in-place mineralized uranium
material in New Mexico and a NRC license to produce up to 1 million pounds of
uranium per year. The Company acquired these properties over the past 20
years along with an extensive information database of historic mining logs and
analysis. None of URI�s properties is currently in production.
URI�s strategy is to fully exploit its resource base
in New Mexico and Texas, expand its asset base both within and outside of New
Mexico and Texas, partner with larger mining companies that have undeveloped
uranium or with junior mining companies that do not have the mining experience
of URI, as well as provide restoration expertise to those that require the
capability or lack the proficiency.
Uranium Resources routinely posts news and other
information about the Company on its Web site at www.uraniumresources.com.
SafeHarborStatement
This news release contains forward-looking statements within the meaning of the
Private Securities Litigation Reform Act of 1995. Forward-looking
statements are subject to risks, uncertainties and assumptions and are
identified by words such as �expects,� �estimates,� �projects,� �anticipates,�
�believes,� �could,� and other similar words. All statements addressing
operating performance, events, or developments that the Company expects or
anticipates will occur in the future, including but not limited to statements
relating to the Company�s mineralized uranium materials, timing of receipt of
mining permits, production capacity of mining operations planned for properties
in South Texas and New Mexico, planned dates for commencement of production at
such properties, revenue, cash generation and profits are forward-looking
statements. Because they are forward-looking, they should be evaluated in light
of important risk factors and uncertainties. These risk factors and
uncertainties include, but are not limited to, the spot price and long-term
contract price of uranium, weather conditions, operating conditions at the
Company�s mining projects, government regulation of the mining industry and the
nuclear power industry, world-wide uranium supply and demand, availability of
capital, timely receipt of mining and other permits from regulatory agents and
other factors which are more fully described in the Company�s documents filed
with the Securities and Exchange Commission. Should one or more of these
risks or uncertainties materialize, or should any of the Company�s underlying
assumptions prove incorrect, actual results may vary materially from those
currently anticipated. In addition, undue reliance should not be placed on the
Company�s forward-looking statements. Except as required by law, the Company
disclaims any obligation to update or publicly announce any revisions to any of
the forward-looking statements contained in this news release.
###