Uranium One Announces a 5% Increase in Q3 2013 Production to 3.2 Million Pounds at an Average Total Cash Cost of $16 per Pound Sold

TORONTO, Nov. 5, 2013 /CNW/ - Uranium One Inc. ("Uranium One") today reported quarterly revenue of $220.8 million for Q3 2013, including joint venture revenue, based on sales of 6.0 million pounds at an average realized sales price of $37 per pound at an average total cash cost per pound sold of $16.

Uranium One also announced today an update of the existing mineral resource and reserve estimates for its operations in Kazakhstan, the United States, Australia and Tanzania, including new and significantly increased mineral resource and reserve estimates for its Akbastau and Karatau uranium mines.

Q3 2013 Highlights

Operational

  • Total attributable production during Q3 2013 was 3.2 million pounds, 5% higher than total attributable production of 3.1 million pounds during Q3 2012.
  • The average total cash cost per pound sold was $16 per pound for Q3 2013, compared to $16 per pound for Q3 2012.

Financial

  • Attributable sales volumes for Q3 2013 were 6.0 million pounds sold from the Corporation's operations and joint ventures compared to 2.9 million pounds sold during Q3 2012.
  • Revenue was $41.0 million in Q3 2013, compared to $8.5 million in Q3 2012.
  • Joint venture revenue in Q3 2013 was $179.8 million, compared to $134.1 million in Q3 2012.
  • The average realized sales price during Q3 2013 was $37 per pound, compared to $49 per pound in Q3 2012. The average spot price in Q3 2013 was $35 per pound compared to $49 per pound in Q3 2012.
  • Earnings from mine operations were $10.4 million in Q3 2013, compared to $5.4 million in Q3 2012.
  • Earnings from mine operations, including earnings from joint ventures, were $49.6 million in Q3 2013, a 15.7% decrease compared to earnings from mine operations, including joint ventures, of $58.8 million in Q3 2012.
  • The net losses for Q3 2013 were $63.6 million or $0.07 per share, compared to net losses of $61.6 million or $0.06 per share for Q3 2012.
  • The adjusted net earnings for Q3 2013 were $30.1 million or $0.03 per share, compared to adjusted net earnings of $7.3 million or $0.01 per share for Q3 2012.
  • The Corporation impaired the Honeymoon project due to continuing difficulties in the production process and issues in attaining design capacity combined with high mine operation costs. The carrying value of Honeymoon was therefore written down by $67.8 million.

Corporate

  • On January 13, 2013, the Corporation entered into a definitive agreement with ARMZ under which the Corporation would be taken private pursuant to a Plan of Arrangement. On March 7, 2013, the Corporation received security holder approval for the proposed Plan of Arrangement. The transaction was completed on October 18, 2013. ARMZ and its affiliates, which owned 51.4% of the Corporation's outstanding common shares and under the agreement, acquired all of the remaining publicly held Common Shares for a cash consideration of CDN$2.86 per share.
  • On August 23, 2013, the Corporation made an offer to the holders of its Series 1 Ruble Bonds and redeemed RUB 11.8 billion (US$382.5 million) of the Series 1 Ruble Bonds. The Corporation also issued Series 2 Ruble Bonds for RUB 12.5 billion (US$380.7 million). There remains RUB 2.5 billion (US$81.0 million) of Series 1 Ruble Bonds in issue. The Corporation entered into six derivatives in September 2013 to economically hedge the Series 2 Ruble Bonds.

Outlook

The Corporation's total attributable production guidance for 2013 remains at 12.5 million pounds. Total attributable production for 2014 is expected to be 12.4 million pounds as shown below.

Operation 2014 Attributable
Production Estimate (M lbs)
Akdala 1.8
South Inkai 3.6
Karatau 2.6
Akbastau 2.0
Zarechnoye 1.1
Kharasan 0.7
Willow Creek 0.6
Total 12.4


During 2014, the average cash cost per pound sold is expected to be approximately $18 per pound.

Operation 2014 Average Total Cash Cost
per Pound Sold ($/lb)
Akdala $16
South Inkai $18
Karatau $11
Akbastau $13
Zarechnoye $26
Kharasan $24
Willow Creek $28
Weighted Average $18


The Corporation expects attributable sales to be approximately 12.4 million  pounds in  2014.

The Corporation expects to incur attributable capital expenditures in 2014 of $65 million for wellfield development and $8 million for plant and equipment, totalling $73 million for its assets in Kazakhstan and the United States.

             
MINE / PROJECT 2014 - ESTIMATED CAPITAL EXPENDITURE IN $ MILLIONS
WELLFIELD
DEVELOPMENT
PLANT AND
EQUIPMENT
AND OTHER
TOTAL   OWNERSHIP
%
TOTAL
100%   ATTRIBUTABLE
Kazakhstan            
Akdala 9 2 11   70% 8
South Inkai 27 3 30   70% 21
Karatau 22 1 23   50% 12
Akbastau 13 1 14   50% 7
Zarechnoye 26 2 28   49.67% 14
Kharasan 29 2 31   30% 9
SKZ-U - 3 3   19% 1
Subtotal - Kazakhstan 127 14 141     72
United States            
Willow Creek and the Powder River Basin - 1 1   100% 1
Subtotal - United States - 1 1     1
Total 127 15 142     73


In 2014, general and administrative expenses, excluding non-cash items, are expected to be approximately $32 million and exploration expenses are expected to be $1 million.

Q3 2013 Operations and Projects

During Q3 2013, Uranium One achieved attributable production of 3.2 million pounds, an increase of 5% over attributable production of 3.1 million pounds for the comparable period in 2012.

Operational results for Uranium One's assets during Q3 2013 were:

Asset Q3 Attributable Production
(lbs U3O8)
Q3 Total Cash Costs
(per lb sold U3O8)
Akdala 419,200 $13
South Inkai 957,700 $16
Karatau 698,200 $11
Akbastau 491,500 $12
Zarechnoye 272,300 $29
Kharasan 153,500 $21
Willow Creek 254,000 $24
Honeymoon(1) 99,300 N/A


Q3 2013 Financial Review

Revenue was $41.0 million in Q3 2013, compared to $8.5 million in Q3 2012. Joint venture revenue in Q3 2013 was $179.8 million, compared to $134.1 million in Q3 2012.

Operating expenses per pound sold were $16 for Q3 2013 compared to $16 in Q3 2012.

Earnings from mine operations were $10.4 million in Q3 2013, compared to $5.4 million in Q3 2012.

Earnings from mine operations, including earnings from joint ventures, were $49.6 million in Q3 2013, a 15.7% decrease compared to earnings from mine operations, including joint ventures, of $58.8 million in Q3 2012.

Attributable inventory as at September 30, 2013 was 0.7 million pounds, which includes work in progress as well as finished product. Finished product at conversion facilities awaiting pre-scheduled deliveries into sales contracts was 0.5 million pounds at September 30, 2013.

The net losses for Q3 2013 were $63.6 million or $0.07 per share, compared to net losses of $61.6 million or $0.06 per share for Q3 2012.

The adjusted net earnings for Q3 2013 were $30.1 million or $0.03 per share, compared to adjusted net earnings of $7.3 million or $0.01 per share for Q3 2012.

Consolidated cash and cash equivalents, including restricted cash of $1,932.8 million as at September 30, 2013 compared to $442.0 million at December 31, 2012. Working capital was $566.7 million at September 30, 2013.

The following table provides a summary of key financial results:

         
FINANCIAL Q3 2013 Q3 2012 YTD
Q3 2013
YTD
Q3 2012
Attributable production (lbs) (2) 3,246,400 3,081,300 9,733,000 8,452,600
Attributable sales (lbs) (2) 5,970,900 2,865,800 10,217,300 6,558,800
         
Average realized sales price ($ per lb) (2) 37 49 40 51
Average total cash cost per pound sold($ per lb)(2) 16 16 17 16
Revenues ($millions)(3)(4) 41.0 8.5 58.1 26.8
Revenues from joint ventures ($millions) 179.8 134.1 348.3 308.5
Earnings from mine operations ($millions)(3)(4) 10.4 5.4 17.4 13.8
Earnings from mine operations, including earnings from joint ventures ($millions) 49.6 58.8 100.3 148.2
Net loss($millions) (63.6) (61.6) (62.5) (27.9)
Net loss per share - basic and diluted ($ per share) (0.07) (0.06) (0.07) (0.03)
         
Adjusted net earnings($millions)(2) 30.1 7.3 44.5 32.1
Adjusted net earnings per share - basic ($ per share)(2) 0.03 0.01 0.05 0.03


The following table provides a reconciliation of adjusted net earnings / (loss) to the consolidated financial statements:

           
(US DOLLARS IN MILLIONS EXCEPT PER
SHARE AMOUNTS)
  3 MONTHS ENDED 9 MONTHS ENDED
SEP 30, 2013
$ MILLIONS
SEP 30, 2012
$ MILLIONS
SEP 30, 2013
$ MILLIONS
SEP 30, 2012
$ MILLIONS
Net loss   (63.6) (61.6) (62.5) (27.9)
Fair value adjustments   (0.3) - (1.2) 0.3
Impairment charges (net of deferred taxes)   67.8 79.1 67.8 79.1
Gain on business combination   - (17.2) - (17.2)
Corporate development expenditure   6.6 0.2 12.6 2.6
Restructuring costs   - 1.5 2.1 1.5
2010 Debentures accelerated interest   17.8 - 17.8 -
Ruble bond hedge accounting adjustments   1.8 5.3 7.9 4.1
Non-recurring income tax adjustment   - - - (10.4)
Adjusted net earnings   30.1 7.3 44.5 32.1
           
Adjusted net earnings per share - basic ($) and
diluted
  0.03 0.01 0.05 0.03
           
Weighted average number of shares (millions) -
basic and diluted
  959.2 957.2 957.9 957.2
           

The financial statements, as well as the accompanying management's discussion and analysis were prepared in accordance with International Financial Reporting (IFRS) and are available for review at www.uranium1.com and should be read in conjunction with this news release. Any reference to information including joint venture balances should be read as a non-IFRS measure used to compare our financial performance to prior periods. All figures are in U.S. dollars unless otherwise indicated.  All references to pounds sold or pounds produced are to pounds of U3O8.

Update of Existing Mineral Resource and Reserve Estimates

As at June 30, 2013 the total attributable proven and probable reserves at the Company's operations in Kazakhstan, the United States, Australia and Tanzania increased by 139% compared to previous estimates, from 61.005 million lbs U3O8 (23,465 tonnes U) to 145.924 million lbs U3O8 (56,129 tonnes U), while the total attributable measured and indicated resources increased by 98%, from 111.641 million lbs U3O8 (42,942 tonnes U) to 221.079 million lbs U3O8 (85,038 tonnes U).

The update includes new resource and reserve estimates for Akbastau and Karatau, showing significant increases in the attributable reserves and resources at both mines:

  • at Akbastau, the Company's attributable share of proven and probable reserves increased by 354%, from 9.047 million lbs U3O8 (3,480 t U) to 41.075 million lbs U3O8 (15,799 t U), while the Company's attributable share of measured and indicated resources increased by 286%, from 15.919 million lbs U3O8 (6,125 t U) to 61.476 million lbs U3O8 (23,647 t U)

  • at Karatau, the Company's attributable share of  proven and probable reserves increased by 674%, from 8.730 million lbs U3O8 (3,358 t U) to 67.543 million lbs U3O8 (25,980 t U), while the Company's attributable share of measured and indicated resources increased by 586%, from 12.102 million lbs U3O8 (4,661 t U) to 82.984 million lbs U3O8 (31,920 t U)

The new estimates, finalized in late October 2013 following review and verification by the Company's Qualified Person, result from the application of 3D modeling techniques to an extensive database of Kazakh Government drilling information which was made available to the Company for the first time. The new estimate does not include any resources for Zarechnoye South as the Company has determined that the mineral resources on this property are insufficient to support development.

Further information, including a breakdown of mineral resource and reserve estimates on a mine by mine basis, is attached as Appendix A to this news release.

About Uranium One

Uranium One is one of the world's largest uranium producers with a globally diversified portfolio of assets located in Kazakhstan, the United States, Australia and Tanzania.

Notes

(1)      Honeymoon production represents concentrates in process that require further processing in order to become uranium concentrates that can be converted into a saleable product.
(2)      Attributable production and sales are from assets owned and joint ventures in commercial production during the period. The Corporation has included the following non-IFRS performance measures: average realized sales price per pound, cash cost per pound sold, adjusted net earnings and adjusted net earnings per share. In the uranium mining industry, these are common performance measures but do not have any standardized meaning, and are non-IFRS measures. The Corporation believes that, in addition to conventional measures prepared in accordance with IFRS, the Corporation and certain investors use this information to evaluate the Corporation's performance and ability to generate cash flow. The additional information provided herein should not be considered in isolation or as a substitute for measures of performance prepared in accordance with IFRS. See "Non-IFRS Measures".
(3)      Comparative information has been restated with the adoption of IFRS 11 - Joint arrangements on January 1, 2013.
(4)      Includes profits / losses for joint venture production delivered into contracts held by the Corporation, and excludes revenues from joint ventures.

Cautionary Statements

No stock exchange, securities commission or other regulatory authority has approved or disapproved the information contained herein.

Scientific and technical information contained herein has been reviewed on behalf of the Corporation by Mr. M.H.G. Heyns, Pr.Sci.Nat. (SACNASP), MSAIMM, MGSSA, Senior Vice President New Business and Technical Services of the Corporation, a qualified person for the purposes of NI 43-101.

Investors are advised to refer to independent technical reports containing detailed information with respect to the material properties of Uranium One. These technical reports are available under the profile of Uranium One Inc. at www.sedar.com. Those technical reports provide the date of each resource or reserve estimate, details of the key assumptions, methods and parameters used in the estimates, details of quantity and grade or quality of each resource or reserve and a general discussion of the extent to which the estimate may be materially affected by any known environmental, permitting, legal, taxation, socio-political, marketing, or other relevant issues. The technical reports also provide information with respect to data verification in the estimation.

Forward-looking statements: This news release contains certain forward-looking statements. Forward-looking statements include but are not limited to those with respect to the price of uranium, the estimation of mineral resources and mineral reserves, the realization of mineral reserve estimates, the timing and amount of estimated future production, costs of production, capital expenditures, costs and timing of the development of new deposits, success of exploration activities, permitting time lines, currency fluctuations, requirements for additional capital, government regulation of mining operations, environmental risks, unanticipated reclamation expenses, the timing and potential effects of proposed transactions, title disputes or claims, limitations on insurance coverage, and the timing and possible outcome of pending litigation. In certain cases, forward-looking statements can be identified by the use of words such as "plans", "expects" or "does not expect", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates" or "does not anticipate", or "believes" or variations of such words and phrases, or state that certain actions, events or results "may", "could", "would", "might" or "will" be taken, occur or be achieved. Forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of Uranium One to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. Such risks and uncertainties include, among others, the completion of the transactions described in this press release, the future steady state production and cash costs of Uranium One, the actual results of current exploration activities, conclusions of economic evaluations, changes in project parameters as plans continue to be refined, possible variations in grade and ore densities or recovery rates, failure of plant, equipment or processes to operate as anticipated, accidents, labour disputes or other risks of the mining industry, delays in obtaining government approvals or financing or in completion of development or construction activities, risks relating to the integration of acquisitions and the realization of synergies relating thereto, to international operations, to prices of uranium as well as those factors referred to in the section entitled "Risk Factors" in Uranium One's Annual Information Form for the year ended December 31, 2012, which is available under Uranium One's profile on SEDAR at www.sedar.com, and which should be reviewed in conjunction with this document. Although Uranium One has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking statements, there may be other factors that cause actions, events or results not to be as anticipated, estimated or intended. There can be no assurance that forward-looking statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements.

Accordingly, readers should not place undue reliance on forward-looking statements. Uranium One expressly disclaims any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except in accordance with applicable securities laws.

For further information about Uranium One, please visit www.uranium1.com.

For further information:

Chris Sattler
Chief Executive Officer
Tel: +1 647 788 8500

Anton Jivov
Vice President, Corporate Affairs
Tel: +1 647 788 8461

                              APPENDIX A


URANIUM ONE INC.
SUMMARY OF MINERAL RESOURCES AND MINERAL RESERVES
AT JUNE 30, 2013


Mine / Area
(Attributable %)
Location
Type of Mine
Category Tonnes Grade Uranium Grade Uranium
    (000s) (%U) (t U) (% U3O8) (M lbs U3O8)
100% Attributable 100% Attributable
Akbastau No 1
(50%)
Kazakhstan
ISL 
               
Measured 20,090 0.081 16,278 8,139 0.096 42.32 21.16
Indicated 3,044 0.124 3,764 1,882 0.146 9.79 4.89
Measured &
Indicated
23,134 0.087 20,042 10,021 0.102 52.11 26.05
Inferred 18,118 0.068 12,405 6,203 0.081 32.25 16.13
Proven 33,233 0.042 13,881 6,940 0.049 36.09 18.04
Probable 5,479 0.056 3,049 1,524 0.066 7.93 3.96
Proven &
Probable
38,712 0.044 16,930 8,464 0.052 44.02 22.00
Akbastau No 3
(50%)
Kazakhstan
ISL
               
Measured 12,247 0.076 9,270 4,635 0.089 24.10 12.05
Indicated 8,928 0.100 8,945 4,473 0.118 23.26 11.63
Measured &
Indicated
21,175 0.086 18,215 9,108 0.101 47.36 23.68
Inferred 1,023 0.120 1,226 613 0.141 3.19 1.59
Proven 21,393 0.035 7,423 3,712 0.041 19.30 9.65
Probable 16,071 0.045 7,245 3,622 0.053 18.84 9.42
Proven &
Probable
37,464 0.039 14,668 7,334 0.046 38.14 19.07
Akbastau No 4
(50%)
Kazakhstan
ISL
Measured 5,912 0.110 6,497 3,249 0.130 16.89 8.45
Indicated 2,616 0.097 2,539 1,270 0.114 6.60 3.30
Measured &
Indicated
8,528 0.106 9,036 4,519 0.125 23.49 11.75
Inferred 13,807 0.125 17,221 8,611 0.147 44.77 22.39
Proven - - - - - - -
Probable - - - - - - -
Proven &
Probable
- - - - - - -
Karatau (50%)
Kazakhstan
ISL  
Measured 35,328 0.058 20,602 10,301 0.069 53.56 26.78
Indicated 51,189 0.084 43,237 21,619 0.100 112.41 56.20
Measured &
Indicated
86,517 0.074 63,839 31,920 0.087 165.97 82.98
Inferred 65,953 0.095 62,772 31,386 0.112 163.19 81.60
Proven 57,248 0.030 16,939 8,469 0.035 44.04 22.02
Probable 92,140 0.038 35,022 17,511 0.045 91.05 45.52
Proven &
Probable
149,388 0.035 51,960 25,980 0.041 135.09 67.54
Akdala - Blizhniy
(70%)
Kazakhstan
ISL
               
Measured 33,935 0.006 1,887 1,321 0.007 4.90 3.43
Indicated - - - - - - -
Measured &
Indicated
33,935 0.006 1,887 1,321 0.007 4.90 3.43
Inferred 911 0.046 415 291 0.054 1.08 0.76
Proven 33,935 0.005 1,698 1,189 0.006 4.41 3.09
Probable - - - - - - -
Proven &
Probable
33,935 0.005 1,698 1,189 0.006 4.41 3.09
Akdala - Letniy
(70%)
Kazakhstan
ISL
               
Measured - - - - - - -
Indicated 628 0.064 399 279 0.075 1.04 0.73
Measured &
Indicated
628 0.064 399 279 0.075 1.04 0.73
Inferred 8,772 0.064 5,600 3,920 0.075 14.56 10.19
Proven - - - - - - -
Probable 1,300 0.028 360 252 0.033 0.94 0.66
Proven &
Probable
1,300 0.028 360 252 0.033 0.94 0.66
South Inkai
(70%)
Kazakhstan
ISL
               
Measured 36,626 0.015 5,325 3,728 0.017 13.84 9.69
Indicated 625 0.051 316 221 0.060 0.82 0.58
Measured &
Indicated
37,251 0.015 5,641 3,949 0.018 14.66 10.27
Inferred 42,845 0.040 17,099 11,969 0.047 44.45 31.12
Proven 51,276 0.009 4,793 3,355 0.011 12.46 8.72
Probable 876 0.032 284 199 0.038 0.74 0.52
Proven &
Probable
52,152 0.010 5,077 3,554 0.011 13.20 9.24
Zarechnoye
(49.67%)
Kazakhstan
ISL
               
Measured 16,786 0.008 1,289 640 0.009 3.35 1.66
Indicated 11,752 0.057 6,699 3,327 0.067 17.42 8.65
Measured &
Indicated
28,538 0.028 7,988 3,967 0.033 20.77 10.31
Inferred 9,400 0.048 4,500 2,235 0.056 11.70 5.81
Proven 33,600 0.003 1,030 512 0.004 2.68 1.33
Probable 15,300 0.023 3,480 1,729 0.027 9.05 4.49
Proven &
Probable
48,900 0.009 4,510 2,240 0.011 11.73 5.82
Kharasan
(30%)
Kazakhstan
ISL
               
Measured 6,975 0.027 1,884 565 0.032 4.90 1.47
Indicated 8,581 0.078 6,677 2,003 0.092 17.36 5.21
Measured &
Indicated
15,556 0.055 8,561 2,568 0.065 22.26 6.68
Inferred 17,600 0.102 17,940 5,382 0.120 46.64 13.99
Proven 13,951 0.008 1,123 337 0.009 2.92 0.88
Probable 17,162 0.035 6,009 1,803 0.041 15.62 4.69
Proven &
Probable
31,113 0.023 7,132 2,140 0.027 18.54 5.57
Willow Creek
(100%)
U.S.A.
ISL
               
Measured - - - - - - -
Indicated 9,843 0.066 6,512 6,512 0.078 16.93 16.93
Measured &
Indicated
9,843 0.066 6,512 6,512 0.078 16.93 16.93
Inferred 94 0.058 54 54 0.068 0.14 0.14
Proven - - - - - - -
Probable 6,494 0.043 2,762 2,762 0.050 7.18 7.18
Proven &
Probable
6,494 0.043 2,762 2,762 0.050 7.18 7.18
Honeymoon
(100%)
Australia
ISL
               
Measured - - - - - - -
Indicated 4,192 0.100 4,208 4,208 0.118 10.94 10.94
Measured &
Indicated
4,192 0.100 4,208 4,208 0.118 10.94 10.94
Inferred - - - - - - -
Proven - - - - - - -
Probable 3,640 0.061 2,213 2,213 0.072 5.75 5.75
Proven &
Probable
3,640 0.061 2,213 2,213 0.072 5.75 5.75
Mkuju River
(13.9%) 
Tanzania 
Conventional 
               
Measured 113,923 0.028 31,579 4,393 0.033 82.10 11.42
Indicated 72,922 0.022 16,348 2,274 0.026 42.50 5.91
Measured &
Indicated
186,845 0.026 47,927 6,667 0.030 124.60 17.33
Inferred 54,549 0.019 10,562 1,469 0.023 27.46 3.82
Proven - - - - - - -
Probable - - - - - - -
Proven &
Probable
- - - - - - -
Total                   
Measured 281,822 0.034 94,611 36,970 0.040 245.97 96.11
Indicated 174,321 0.057 99,644 48,067 0.067 259.05 124.96
Measured &
Indicated
456,143 0.043 194,255 85,038 0.050 505.02 221.08
Inferred 233,072 0.064 149,794 72,132 0.076 389.43 187.53
Proven 244,636 0.019 46,886 24,513 0.023 121.89 63.73
Probable 158,462 0.038 60,426 31,616 0.045 157.09 82.19
Proven &
Probable
403,098 0.027 107,312 56,129 0.031 278.99 145.92

Notes:  
(1)  Mineral Resources that are not Mineral Reserves do not have demonstrated economic viability.  Inferred Mineral Resources have a great amount of uncertainty as to their existence and as to their economic feasibility.  Under no circumstances can it be assumed that all or any part of an Inferred Mineral Resource will ever be upgraded to a higher Mineral Resource category or converted to Mineral Reserves.
(2)  All Mineral Resources and Mineral Reserves are reported in accordance with the definitions and guidelines for the reporting of exploration information, Mineral Resources and Mineral Reserves determined by the Canadian Institute of Mining, Metallurgy and Petroleum Definition Standards on Mineral Resources and Mineral Reserves adopted by the CIM Council (the "CIM Standards") and National Instrument 43-101 - Standards of Disclosure for Mineral Projects promulgated by the Canadian Securities Administrators ("NI 43-101").  Unless otherwise stated, for each project the Mineral Reserves stated above are included in the total estimate of Mineral Resources as stated above. All figures are rounded to reflect appropriate levels of confidence. Columns may not add up correctly due to rounding.
(3)    The above estimates are reported both on a 100% basis and on the basis of the portion of total Mineral Reserves and/or Mineral Resources notionally attributable to Uranium One's equity interests in Mkuju River Project, and the joint ventures through which the mines in Kazakhstan are owned.  Uranium One's interests in the above mines and projects are as follows: Akdala (70%), South Inkai (70%), Karatau (50%), Akbastau (50%), Zarechnoye (49.67%), Kharasan (30%), Willow Creek (100%), Honeymoon (100%), and Mkuju River (13.9%).
   

Resource and Reserve Estimation Methodology

In July 2013, Roscoe Postle Associates Inc. ("RPA") was engaged by Uranium One to undertake a review of existing mineral resource and reserve estimates for the Company's operations in Kazakhstan, the United States, Australia and Tanzania (other than Akbastau and Karatau, in respect of which new estimates prepared for the Company by CSA Global Pty Ltd. ("CSA") were considered) and to deplete those estimates for production based on production figures as at June 30, 2013. The final draft report was delivered to the Company on September 30, 2013; the process of review and verification of the draft report was completed by the Company's Qualified Person in late October 2013.

Depletion Methodology

Reserve estimates include dilution, an estimate for extraction, and are stated as "delivered to the plant". Mining depletion has in all cases been based on production data provided by Uranium One as at June 30, 2013. Resources were depleted on the basis of tonnes of uranium extracted divided by the planned extraction. Where production to date has exceeded the resource estimate for a given production block, the block was only depleted to the extent of the pre-existing resource estimate and any additional production was considered to be "production in addition to the resource/reserve estimate".

In some cases, depleted resource estimates were generated from the remaining reserve estimates, as the level of review did not include the re-estimation of resources where measured and indicated resources had been converted to reserves.  In cases where the changes could not be readily identified, RPA first depleted measured and then indicated resources.  In support of its reserve estimate for each property, RPA also reviewed production to date and the performance of the leach fields at the operations, in terms of extraction versus time and extraction versus pore volume exchanges.

Mineral Resource and Reserve Estimates for Akbastau and Karatau

CSA was engaged by Uranium One in November 2012 to prepare new resource and reserve estimates for Akbastau and Karatau following the provision by the Government of Kazakhstan for the first time of an extensive database of previously unavailable drilling data. Previously, estimates for the Company's mines in Kazakhstan were prepared in accordance with the Russian resource classification system (using a 2D polygonal geological modeling and estimation process) and then converted to the CIM resource classification system.  Direct access to the raw drilling data enabled the preparation for the first time of resource and reserve estimates at Akbastau and Karatau using the application of internationally recognized and more exhaustive 3D modeling techniques.

The resource estimates for Akbastau and Karatau were prepared by CSA and reviewed by RPA, and RPA also prepared the reserve estimates under contract to CSA starting in July 2013. RPA used CSA's Akbastau and Karatau resource block models to prepare the reserve estimates.  CSA re-estimated the global mineral resources for both deposits, using new wireframe models and interpolation of grades into block models based on the existing drilling data collected to date.  RPA applied a 90% extraction rate, the same rate as used in previous estimates, because it is supported by the extraction curves from the site.  In addition, RPA deducted a further 10% of the resources outside of the technological blocks to account for thin zones and other potential losses.  RPA recommends further review of the resource model and the location of potential surface interference to better define this value.  Where production from the technological blocks exceeded the planned extraction of 90%, RPA depleted the resource and reserve rock tonnages and uranium tonnage from the total estimate and considered any additional production to be "production in addition to the resource/reserve estimate".

The updated reserve estimates for Akbastau and Karatau are based on a cut-off of 0.01% U, 4 m thickness, and using an average long-term uranium price of US$65 per pound U3O8 (US$169/kg U).

RPA did not convert any of the resources at the Akbastau No. 4 deposit to reserves as the mining in this area is at the test production stage.

Qualified Persons

Except as otherwise noted, Mr. M.H.G. Heyns, Pr.Sci.Nat. (SACNASP), MSAIMM, MGSSA, CIM, Senior Vice-President of Uranium One, is the Qualified Person who prepared or supervised the preparation of the information that forms the basis of the scientific and technical disclosure on the Company's mineral properties contained in this press release, and all of the estimates set out herein, with the exception of those relating to the Mkuju River Project, have been reviewed by Roscoe Postle Associates Inc. under the supervision of its Qualified Person, Mr. Dennis Bergen, P. Eng., Associate Principal Mining Engineer.  The resource estimates for the Karatau and Akbastau mines were prepared for the Company by independent consultants CSA Global Pty Ltd., under the supervision of its Qualified Person, Dr. Maxim Seredkin, Senior Resource Geologist, and the reserve estimates were prepared by RPA, under the supervision of its Qualified Person, Mr. Denis Bergen

SOURCE: Uranium One Inc.

For further information:

Chris Sattler
Chief Executive Officer 
Tel: +1 647 788 8500

Anton Jivov
Vice President, Corporate Affairs
Tel: +1 647 788 8461

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Uranium One Inc.

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