Ur-energy Inc. · TSX:URE
Ur-energy — Investor Presentation (March 2019)
23 slides from Ur-energy's investor presentation, Mar 7, 2019
Slide 1: 2019: The Year for Uranium
NYSE American: URG • TSX: URE 2019: The Year for Uranium
Slide 2: Forward-looking statements disclaimer
NYSE American: URG • TSX: URE This presentation contains “forward - looking statements,” within the meaning of applicable securities laws, regarding events or conditions that may occur in the future . Such statements include without limitation the Company’s maintaining controlled - level production
Slide 3: Company highlights: Lost Creek, contracts and U.S. uranium industry
NYSE American: URG • TSX: URE 3 See Disclaimer re Forward - looking Statements and Projections (slide 2) ▪ Lost Creek ISR Uranium Facility • 5+ years of consistent production • Produced ~2.7M lbs. U 3 0 8 through 2018 • Controlled production at market - appropriate levels • Lowest - cost producer am
Slide 4: 2018 accomplishments
NYSE American: URG • TSX: URE 4 ▪ Improved safety record year over year ▪ Produced, packaged and shipped ~2.5M lbs U 3 O 8 ▪ Built solid contract book for a period of nine years (2013 - 2021) ▪ Significantly grew Lost Creek Property NI 43 - 101 resource ▪ First ISR facility to reduce/recycle waste w
Slide 5: Lost Creek operations update
NYSE American: URG • TSX: URE 5 Staffing ▪ Key personnel retained to lead ramp - up Wellfield ▪ MU1: ▪ Recovered ∼ 92% of under - pattern resources ▪ Planning for capture of remaining pounds not currently under pattern ▪ MU2 ▪ Recovered ∼ 65% of under - pattern resources in first three header houses
Slide 6: Uranium production and cost
NYSE American: URG • TSX: URE 6 2014 2015 2016 2017 2018 Captured 596K lbs 784K lbs 538K lbs 265K lbs 302K lbs Drummed 548K lbs 727K lbs 561K lbs 254K lbs 286K lbs Cash Cost* $19.73/lb $16.27/lb $17.15/lb $24.41/lb $25.37/ lb Uranium Production and Cost 2014 2015 2016 2017 2018 $26.5 million $41.8 m
Slide 7: Gross profit margin and price per pound sold
NYSE American: URG • TSX: URE 7 0% 10% 20% 30% 40% 50% 60% $- $10.00 $20.00 $30.00 $40.00 $50.00 $60.00 2014 2015 2016 2017 2018 Percentage US$ per Pound Gross profit margin Price per pound sold 2018: ▪ Gross profit margin of $11.3M on sales of $23.5M (or ~48%) ▪ Net income, before income taxes, of
Slide 8: Growing finished product inventory
NYSE American: URG • TSX: URE 8 $- $5.00 $10.00 $15.00 $20.00 $25.00 $30.00 $35.00 - 50,000 100,000 150,000 200,000 250,000 300,000 350,000 400,000 450,000 2017 Q3 2017 Q4 2018 Q1 2018 Q2 2018 Q3 2018 Q4 US$ per Pound Pounds Conversion facility inventory Total inventory Ending spot price ▪ >375,000
Slide 9: Production costs by year
NYSE American: URG • TSX: URE 9 $- $5.0 $10.0 $15.0 $20.0 $25.0 - 150,000 300,000 450,000 600,000 750,000 2014 2015 2016 2017 2018 Millions of US$ Pounds Taxes Cash costs Non-cash costs Pounds drummed
Slide 10: U.S. demand dependent on foreign imports
NYSE American: URG • TSX: URE ▪ U.S. demand is dependent on foreign imports • Imports of 50M lbs annually for seven of last eight years • 2018 U.S. mined production <1Mlbs U 3 O 8 ▪ Not a level playing field. Result: Section 232 filing 10 See Disclaimer re Forward - looking Statements and Projection
Slide 11: U.S. dependence on Russia and allies for nuclear fuel
NYSE American: URG • TSX: URE 11 ▪ Ur - Energy and Energy Fuels are the two primary domestic producers still able to operate in current market conditions ▪ Only domestic uranium conversion facility shut down in 2017 ▪ The U.S. lacks any domestic uranium enrichment capability ▪ We import ~40% of our
Slide 12: The need for a uranium Section 232 investigation
NYSE American: URG • TSX: URE 12 RSA ends 12/2020: Russians promise greater imports to the U.S. The Need for a Uranium Section 232 Investigation and Relief is Clear: U.S. Production Plummeting China vows to target U.S. market while taking over production in Namibia U.S. Utilities Have Bought Into Th
Slide 13: National security remedy for domestic industry
NYSE American: URG • TSX: URE ▪ Military needs, by treaty, must be filled with domestic supply yet our inventory is, in the words of DOE, “finite and diminishing . ” Tritium Naval Propulsion Weapons Priority Missions ▪ National economic security is also an integral part of the statute . U . S . nucl
Slide 14: Section 232 investigation timeline
NYSE American: URG • TSX: URE x Petition filed January 16, 2018 x Commerce initiated the investigation on July 18, 2018 x Public comment period ends September 10, 2018 ▪ Commerce must complete its investigation within 270 days and make recommendations to the President (April 14, 2019) ▪ The Presiden
Slide 15: Measured, indicated and inferred resources
NYSE American: URG • TSX: URE Measured Indicated Inferred Project AVG GRADE % eU 3 O 8 SHORT TONS (X 1000) POUNDS (X 1000) AVG GRADE % eU 3 O 8 SHORT TONS (X 1000) POUNDS (X 1000) AVG GRADE % eU 3 O 8 SHORT TONS (X 1000) POUNDS (X 1000) *LOST CREEK (1) 0.048 8,316 8,028 0.044 5,942 5,223 0.044 7,368
Slide 16: Operational leverage and ramp-up readiness
NYSE American: URG • TSX: URE 16 ▪ Production ▪ Planning for capture of remaining MU1 pounds not currently under pattern ▪ 10 remaining mine units at Lost Creek, per 2016 PEA; est. 4.5Mlbs remaining in MUs1&2 (fully permitted) ▪ Efficiencies ▪ Operating staff only; retained key staff for ramp - up ▪
Slide 17: Production ramp-up plan
NYSE American: URG • TSX: URE 17 *Assumes July 2019 initiation of ramp - up Production into future years to be supported through exploration and development of Ur - Energy’s portfolio of properties . See Disclaimer re Forward - looking Statements and Projections (slide 2)
Slide 18: 2019-2021 development and capital spending
NYSE American: URG • TSX: URE ▪ Lost Creek ▪ 2019 – $15.4 million for mine development ($14.9m) and CapEx ($0.5m) to reach 1.0 million pound rate in 2020 ▪ 2020 – Revenues should cover further development activities ▪ Shirley Basin ▪ 2019 – $4.5 million for mine development ($3.9m) and CapEx ($0.6m)
Slide 19: Share price, share capital and analyst coverage
NYSE American: URG • TSX: URE 19 Share Price (02/25/2019) US$0.74 52 Week Range US$0.54 - $.93 Avg. Daily Volume ~381,000 (3 - mo URG & URE 02/25/2019) Member of S&P/TSX SmallCap Index Share Capital & Cash Position As of 12/31/2018 Shares Outstanding 159.7M Stock Options & RSUs 10.7M Shares Reserved
Slide 20: Market forces and supply/demand
NYSE American: URG • TSX: URE ▪ Supply / Demand: Growth Rate is Real • New players entering uranium market • Real production cuts from Kazakhstan and Cameco ▪ Current Market Forces • Cameco in market as buyer • Section 232 investigation progressing - potential for increased market for U.S. producers
Slide 21: Well financed for 2019
NYSE American: URG • TSX: URE • Recent capital raise + term contracts = well financed for 2019 500,000 lbs for 2019 deliveries – expect $11.5M gross profits • Current value of term contracts – use of purchased pounds All production currently going into growing inventory Finished product being
Slide 22: Q&A Session
NYSE American: URG • TSX: URE Q&A Session Your questions, please 22
Slide 23: For more information, please contact
NYSE American: URG • TSX: URE For more information, please contact: Jeff Klenda , Chairman, President & CEO By Mail: Ur - Energy Inc. 10758 W. Centennial Rd., Suite 200 Littleton, CO 80127 USA By Phone: Office 720.981.4588 Toll - Free 866.981.4588 Fax 720.981.5643 By E - mail: jeff.klenda@ur - energ