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Uranium Energy: North America’s newest emerging uranium producer

www.uraniumenergy.com  •  1.866.748.1030

In every downturn there is an opportunity and Amir Adnani recognizes it when he sees one. Following the Fukushima nuclear incident in March 2011, the CEO of Uranium Energy Corp (NYSE-AMEX: UEC) and North America’s newest uranium producer, strategically acquired two uranium projects with extensive historic work in Arizona and one of the largest land packages globally with ISR potential in Paraguay. UEC’s acquisitions have demonstrated a significant vote of confidence in the fundamentals of the uranium sector. Amidst the challenges in 2011 UEC was able to execute on its key objective of initiating and ramping-up production at low cash costs. Adnani discusses UEC’s milestones in 2011 and why it is well positioned for major ongoing growth in 2012 and beyond.

Resource Intelligence: Could you give us an  overview of Uranium Energy?

Amir Adnani: Uranium Energy Corp is North America’s newest uranium producer. We have a regional “hub and spoke” production strategy in South Texas where we have 100% ownership of the Hobson processing facility and control four in-situ recovery projects nearby. We also control an additional 23 projects throughout the US and a 987,000-acre land package with ISR potential in Paraguay.

RI: Palangana began production in November 2010. What’s the latest in the project?

AA: Since the start of production UEC has demonstrated the advantages of low-cost in-situ recovery (ISR). As part of our multi-year sales agreement we have sold a total of 120,000 lbs at $52/lb resulting in total revenues of $6.2 million.

At Palangana, we are initially targeting three production areas with Production Area-1 (PAA-1) currently in operation. We have produced more than 200,000 lbs from PAA-1 and are focused on expanding production with Production Area-2 scheduled to commence operations in April.

RI: Your second satellite operation is the Goliad ISR Project. Could you provide us with an update?

AA: As of December 2011, we have received all of the state-level permits to start construction at our 100%-owned Goliad project in South Texas. Once operational, Goliad is anticipated to increase the Company’s production in South Texas substantially. Goliad is currently in the initial stages of mine construction with production scheduled to start in late-2012.

RI:  How has the Fukushima nuclear accident in March affected Uranium Energy and your fund-raising efforts?

AA: Despite 2011 having been a challenging year for the uranium sector, UEC, as one of the few uranium producers worldwide, was able to execute on its key objective of initiating and ramping-up production at low cash costs. At the time of Fukushima, UEC had over $30 million in cash and since then we have made sales totalling $6.2 million. As a result we have been fortunate not to have to pursue fund-raising efforts. During this downturn we have also made strategic acquisitions in Arizona and Paraguay to favourably position the company for long-term growth.

RI: The two acquisitions you made amidst the downturn is also a vote of confidence in the future of the uranium market. Could you comment on this?

AA: The US operates 104 nuclear reactors and consumes ~55 M/lbs but only produces ~4 M/lbs. UEC was formed with the objective increasing US domestic production to reduce this imbalance and provide increased security of supply. In line with this focus we acquired the Anderson and Workman Creek projects in Arizona. Both of these projects have been subjected to extensive historic work previously resulting in positive feasibility studies. Arizona is home to three of the largest nuclear power plants and all three recently received 20-year license extensions.

UEC has been aggressive during this downtown to acquire projects of merit that are undervalued to historic valuations. Recent M&A activity is certainly a vote of confidence for the uranium sector and long-term fundamentals.

RI: What can we expect from Uranium Energy over the next 12 months?

AA: In South Texas we are focused on expanding production at Palangana with new production areas set to come online. Mine construction is ongoing at Goliad and initial production scheduled to commence in late 2012. Drilling programs are also underway to expand resources at our Palangana and Salvo projects.

We also expect to publish resource estimates on both of the newly-acquired Anderson and Workman Creek projects in Arizona. Lastly, there should be continued exploration and drilling results from our 987,000-acre ISR land package in Paraguay.

RI: What differentiates Uranium Energy from others in the uranium sector?

AA: UEC is one of the world’s few uranium producers and produces using low-cost ISR methods. In addition to our regional South Texas production strategy, we have a diversified project portfolio. We are now also a leading player in Arizona and UEC controls one of the largest land packages globally with ISR potential in Paraguay.

View the full UEC chart at Wikinvest

RI: Where do you think the uranium sector is headed in 2012?

AA: I think this year is going to be the “comeback year” for uranium as the same reasons to be bullish on uranium pre-Fukushima exist today. Firstly, mine supply does not meet current reactor requirements, let alone future demand. This supply imbalance will only be exacerbated with the expiry of the HEU Agreement in 2013, which supplies ~15% of the global market. Most importantly, emerging economies continue to expand nuclear capacity with China alone currently constructing 27 reactors. Nuclear power remains the only form of emission-free base load power. As we near further supply shortages in 2013, we expect the sector to catch up to the underlying fundamentals.

Investor Highlights 

• North America’s newest producer with low cost in-situ recovery operations in the U.S.
• Emerging uranium producer, 100% un-hedged, with major growth profile
• More than 23 conventional and ISR projects across 
• the Americas