UrAsia Energy Ltd. announces financial results for the five months ended December 31, 2006



    (All amounts are in United States dollars (US$) unless otherwise noted)

    Trading Symbol (TSXV: UUU and AIM: UUU)

    VANCOUVER, March 30 /CNW/ - UrAsia Energy Ltd. (the 'Company' or
'UrAsia') is pleased to report the Company's consolidated financial results
for the five months ended December 31, 2006.
    The Company changed its year end from July 31 to December 31; the related
consolidated financial statements for the period ended December 31, 2006 are
for the five month period from August 1 to December 31, 2006 being the first
year end after the change in year end.
    On November 7, 2005 UrAsia acquired indirect interests in three uranium
projects in the Republic of Kazakhstan, including the Akdala operating mine
"Akdala" and the South Inkai uranium project "South Inkai" and the Kharassan
uranium project "Kharassan". In addition, the Company has an extensive uranium
exploration portfolio in the Kyrgyz Republic.
    UrAsia has a 70% interest in the Betpak Dala Joint Venture, which has a
100% interest in the Akdala operating uranium mine and the South Inkai uranium
development project; and a 30% interest in the Kyzylkum Joint Venture which
has a 100% interest in the Kharassan uranium development project.

    
    Highlights for the Five Months Ended December 31, 2006

    -   On February 11, 2007 the Company announced a definitive arrangement
        agreement whereby sxr Uranium One Inc. will acquire all of the
        outstanding shares of the Company to create a new company with a
        market capitalization of approximately US$5 billion, subject to
        shareholder and regulatory approvals. If the business combination is
        approved, the combined company, Uranium One, will be a leading global
        uranium producer with a diversified asset base in the Republic of
        Kazakhstan, Australia, Canada, South Africa, United States, and the
        Kyrgyz Republic.

    -   Sales of Akdala product (70% attributable) during the five months
        ended December 31, 2006 amounted to approximately 980,000 pounds of
        U(3)O(8) (377,000 Kg U). The Company's attributable share (70%) of
        revenue from uranium sales amounted to $50.5 million. After the
        deduction of production costs of $9.3 million, depreciation and
        depletion charges of $8.4 million, the earnings from mine operations
        were $32.7 million. Production (70% share) during the five months
        ended December 31, 2006 was approximately 940,000 pounds of U(3)O(8)
        (361,400 kg U).

    -   The average unit price obtained for sales during the five months
        ended December 31, 2006 was $51 per pound U(3)O(8), the average spot
        price during this period was approximately $60 per pound U(3)O(8).
        The  average production cost per pound of U(3)O(8) sold was
        approximately $9.

    -   Net income for the five month period was $19.7 million ($0.04 per
        share). This includes $24.7 million arising from non-cash income from
        an exchange gain on the revaluation of future income tax liabilities.
        Adjusted for this item, the Company incurred a loss of $5.0 million.

    -   Due to improved cash flow from uranium sales at Betpak Dala all
        outstanding loans payable to the Company by Betpak Dala totalling
        $62.6 million were repaid in the first quarter of 2007.
    

    Commenting on the Company's interim financial results, Phillip
Shirvington, President and Chief Executive Officer, said: "the significant
deliveries for the period which were weighted heavily towards the end of 2006
have for the first time provided a true picture of our operational
profitability. We expect this to continue with further strengthening of the
uranium price during the year."

    Financial Results of Operations

    During the five month period ended December 31, 2006 sales of Akdala
product (70% attributable) amounted to approximately 980,000 pounds of
U(3)O(8) (377,000 kg U) compared to 812,000 pounds of U(3)O(8) (312,000 Kg U)
for the year ended July 31, 2006. The Company's attributable share (70%) of
revenue from uranium sales amounted to $50.5 million. After the deduction of
production costs of $9.3 million, depreciation and depletion charges of
$8.5 million earnings from mining operations were $32.7 million. For the nine
months ended July 31, 2006 sales of Akdala product (70% attributable) amounted
to approximately $23.5 million. After deducting production costs of
$9.5 million, depreciation and depletion charges of $5.1 million, earnings
from mine operations were $8.9 million.
    The average unit price obtained for sales during the five months ended
December 31, 2006 was $51 per pound of U(3)O(8) compared to the average price
of $29 per pound of U(3)O(8) for sales in the nine months ended July 31, 2006.
The spot price of uranium at December 31, 2006 was $75 per pound of U(3)O(8);
the spot price has increased gradually from $33 per pound at October 31, 2005.
Sales in the comparative period resulted from a blend of older lower priced
contracts with newer market related contracts whereas sales in the current
period are for market related contracts.
    During the five months ended December 31, 2006 production costs were
$9.3 million or approximately $9 per pound of U(3)O(8) sold. During the year
ended July 31, 2006, which included the first nine months of operations,
production costs were $9.5 million or approximately $12 per pound of U(3)O(8)
sold. Reduction of production costs is a result of more efficiencies in the
operations due to improved drilling methods and improvement of the plant
facilities. Also comparative per unit costs are lower in the current period
because costs of production are allocated over a higher volume of sales than
in the period ended July 31, 2006, costs in the prior period included
non-recurring start-up costs allocated to production.
    Depreciation for the current period, including depletion of mineral
property for five months based on established values of purchase price paid
for mineable reserves, amounted to approximately $9 per pound of U(3)O(8)
compared to approximately $6 for the nine months of operations ended July 31,
2006. The average unit cost of depletion increased from the previous year
average due to the finalization of the purchase price allocation between
Akdala and South Inkai.
    Stock-based compensation amounted to $22.2 million for the five month
period ended December 31, 2006 compared to $9.4 million for the year ended
July 31, 2006. The increase in the period ended December 31, 2006 is a result
of the fair value of fully vested options granted to directors and employees
in November 2006.
    Exploration expenditure related to geological programs being undertaken
on the Company's license areas in Kyrgyzstan and amounted to $2.8 million
during the five months ended December 31, 2006 compared to $2.6 million
incurred in the nine months of operations ended July 31, 2006.
    Interest and other income amounted to $3.7 million for the five month
period ended December 31, 2006 compared to $4.4 million for the year ended
July 31, 2006.
    There was a foreign exchange gain during the five months ended
December 31, 2006 of $23.5 million compared to a loss during the year ended
July 31, 2006 of $41.1 million. Of the $23.5 million foreign exchange gain
recorded in the current period $24.7 million related to an unrealized foreign
exchange gain on translation of future income tax liabilities arising from the
purchase of participating interests in the joint ventures in Kazakhstan (year
ended July 31, 2006 - $42.6 million loss). The foreign exchange gain or loss
related to the future income tax liability is an unrealized currency
translation adjustment on the future income tax liability, denominated in
Kazakh Tenge (KZT), which is a monetary liability. The future tax liability
arose on the excess amounts paid for mineral property when acquired in
November 2005. The exchange rate in November 2005, when the liability was
established, was 134 KZT = USD 1. Since then, the KZT strengthened 12% against
the US dollar to 118 KZT = USD 1 at July 31, 2006. However, the KZT weakened
by 8% during the five months to December 31, 2006 to 127 KZT = USD
1.
    The provision for current income taxes for the five months ended
December 31, 2006 was $15.9 million compared to $5.3 million for the year
ended July 31, 2006.
    The net income after income taxes for the five month period ended
December 31, 2006 was $19.7 million ($0.04 per share) compared to a loss after
income taxes for the year ended July 31, 2006 of $49 million ($0.12 per
share).

    Cash position

    At March 27, 2007, the Company had a cash position of approximately
$109 million that will be used to continue development of the South Inkai and
Kharassan uranium projects within the Republic of Kazakhstan and to continue
exploration drilling, which commenced this year, on the Company's Kyrgyz
uranium exploration licenses.

    Construction and Development Update

    The initial construction phase at the South Inkai and Kharassan uranium
projects has progressed well with production still being targeted for the end
of 2007.
    During the five month period ended December 31, 2006, at South Inkai
construction of the road to the process plant was completed, and the
foundations for the office building, accommodation module, auxiliary building,
special laundry and shift camp were completed. Steel supporting columns were
erected for the administration building, special laundry and utility
buildings. Earth-moving for slime pit and pregnant and leaching solution ponds
were completed, installation of the reinforced floor was completed.
    Foundation work was completed on additional buildings for which contracts
were awarded in October for the construction of the ammonium nitrate warehouse
with solution plant, acid storage with pumping station, ramp for acid tank
truck, first aid outlet and production pumping house.
    Additional contracts were awarded in November for the construction of a
warehouse, fuel filling point, operator room and interior roads.
    Due to the increase of electrical power requirements at the South Inkai
construction site and the commissioning of additional power consuming
equipment, an additional 400 KVA transformer and additional overhead power
lines were installed in December 2006.
    At Kharassan construction has commenced with the completion of the
foundation work for most structures including the equipment and machinery
storehouse. Other progress includes:

    
    -   Pregnant solutions (main) plant - foundations and equipment pedestals
        completed with "non-standard" process equipment being mounted;
    -   A total of 6 ion exchange columns, 4 de-nitrification columns and 3
        de-sorption columns have been set upon the building foundation;
    -   Framing and installation of external and internal paneling is
        underway on auxiliary buildings;
    -   Plant foundation is complete and steel columns construction is in
        progress in the pregnant/leaching solution ponds
    -   Earthwork for the construction of a 26.6 km road between the plant
        site and the bridge across the Syr-Dayra River is underway;
    -   A road construction contract was awarded in December for a 10.6 km
        road from the bridge to the planned future site of the transportation
        depot;
    -   Construction of the bridge across the Syr-Darya River is continuing
        with drilling of the main supporting piers; rising of the river level
        in November caused the first location in the deepest part of the
        river to be abandoned; work continues at the second location,
        currently 10 piers are being drilled.
    

    The license area at the Kharassan uranium project has been increased in
area by 15% from 70.8 km(2) to 82.2 km(2). The Kyzylkum joint venture will
explore the prospective area for further mineralized horizons.

    Joint Drilling

    On October 20, 2006, UrAsia entered into an agreement to acquire a 50%
interest in Joint Drilling LLP, subject to certain closing conditions which
have not been met, a Kazakhstan drilling contractor, licensed in Kazakhstan to
drill uranium wells. The company will supply a total of twelve US built GEFCO
drill rigs to Joint Drilling in order to accelerate the numerous drilling
programs on all of UrAsia's mining and development properties.

    Outlook

    The Company is continuing to proceed with its Kazakhstan uranium projects
which entail the continuation of production at the Akdala mining operation at
a rate of 2.6 million pounds per annum, and the development of the in-situ
mining operations at South Inkai and Kharassan.
    UrAsia's attributable annual production for the calendar year 2006 was
expected to be approximately 1.8 million pounds of U(3)O(8) (700 t U) while
actual production (70% attributable) for the 2006 calendar year was
1.9 million pounds of U(3)O(8) (730 t U).
    In 2007 Akdala is planned to operate at its design rate of 1,000 tonnes
uranium per annum. Therefore the Company's attributable share of production in
2007 is forecast to be 1.8 million pounds of U(3)O(8) (700 t U). The Company's
attributable share of production for the calendar year 2007 from all
operations is expected to be 2.0 million pounds of U(3)O(8) (770 t U).
    UrAsia, a Canadian-based uranium producer listed on the TSX Venture
Exchange and the Alternative Investment Market (AIM) of the London Stock
Exchange under the symbol UUU offers investors exposure to low-cost uranium
production and growth.

    On Behalf of UrAsia Energy Ltd.

    "Phillip Shirvington"

    President and Chief Executive Officer

    To view the full financial statements for the quarter, please visit
www.sedar.com.

    The TSX Venture Exchange has not reviewed and does not accept
    responsibility for the adequacy or accuracy of this release. The
    foregoing information may contain forward-looking statements relating to
    the future performance of UrAsia Energy Ltd. Forward-looking statements,
    specifically those concerning future performance, are subject to certain
    risks and uncertainties, and actual results may differ materially. These
    risks and uncertainties are detailed from time to time in the Company's
    filings with the appropriate securities commissions.


    
    URASIA ENERGY LTD.
    Consolidated Balance Sheets
    (Unaudited)
    (United States dollars in thousands)

                                                   December 31,      July 31,
                                                          2006          2006
    -------------------------------------------------------------------------
    Assets
    Current assets
      Cash and cash equivalents                     $   61,838    $  128,328
      Restricted cash                                      500         2,500
      Accounts receivable                               48,311        10,173
      Current portion of loans to joint ventures        13,488         4,440
      Inventory                                         12,044        11,940
      Prepaid expenses and other                           875         1,177
    -------------------------------------------------------------------------
                                                       137,056       158,558
    Loans to joint ventures                             39,850        21,000
    Mineral properties, plant and equipment            768,887       762,547
    Other assets                                        25,825         8,920
    -------------------------------------------------------------------------
                                                    $  971,618    $  951,025
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Liabilities
    Current liabilities
      Accounts payable and accrued liabilities          12,947         6,095
      Income taxes payable                               1,018         3,080
    -------------------------------------------------------------------------
                                                        13,965         9,175
    Due to Republic of Kazakhstan                        1,466         1,046
    Future income taxes                                337,642       365,491
    Asset retirement obligation                          2,856         1,953
    -------------------------------------------------------------------------
                                                       355,929       377,665
    -------------------------------------------------------------------------
    Shareholders' equity
    Share capital                                      613,607       612,941
    Contributed surplus                                 31,286         9,307
    Retained deficit                                   (29,204)      (48,888)
    -------------------------------------------------------------------------
                                                       615,689       573,360
    -------------------------------------------------------------------------
                                                    $  971,618    $  951,025
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------



    Approved by the Board:

    "Ian Telfer"           Director
    -----------------------

    "Phillip Shirvington"  Director
    -----------------------



    URASIA ENERGY LTD.
    Consolidated Statements of Operations and Retained (Deficit)
    Earnings
    (Unaudited)
    (United States dollars in thousands, except per
     share amounts)

                                                      5 Months          Year
                                                         Ended         Ended
                                                   December 31,      July 31,
                                                          2006          2006
    -------------------------------------------------------------------------
    Mine operations
    Revenue from uranium sales                      $   50,449    $   23,507
    -------------------------------------------------------------------------
    Production costs                                     9,289         9,548
    Depreciation and depletion                           8,449         5,107
    -------------------------------------------------------------------------
    Earnings from mine operations                       32,711         8,852
    -------------------------------------------------------------------------
    Expenses
      General and administration                         2,637         5,493
      Stock-based compensation                          22,162         9,370
      Exploration                                        2,914         2,648
      Other                                                552           169
    -------------------------------------------------------------------------
                                                        28,265        17,680
    -------------------------------------------------------------------------
    Income (loss) from operations                        4,446        (8,828)
    -------------------------------------------------------------------------
    Other income
      Interest and other income                          3,742         4,408
      Foreign exchange gain (loss)                      23,507       (41,120)
    -------------------------------------------------------------------------
                                                        27,249       (36,712)
    -------------------------------------------------------------------------
    Income (loss) before income taxes                   31,695       (45,540)
    -------------------------------------------------------------------------
    Provision for (recovery of) income taxes
      Current                                           15,984         5,304
      Future                                            (3,973)       (1,905)
    -------------------------------------------------------------------------
                                                        12,011         3,399
    -------------------------------------------------------------------------
    Net income (loss) for the period                    19,684       (48,939)
    Retained (deficit) earnings, beginning of
     period                                            (48,888)           51
    -------------------------------------------------------------------------
    Deficit,  end of period                         $  (29,204)   $  (48,888)
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------

    Earnings per share:
      Basic                                         $     0.04    $    (0.12)
      Diluted                                       $     0.04    $    (0.12)

    Weighted average number of shares
     outstanding (000's):
      Basic                                            479,998       406,239
      Diluted                                          484,390       406,239



    URASIA ENERGY LTD.
    Consolidated Statements of Cash Flows
    (Unaudited)
    (United States dollars in thousands)

                                                      5 Months          Year
                                                         Ended         Ended
                                                   December 31,      July 31,
                                                          2006          2006
    -------------------------------------------------------------------------
    Operating activities
    Net income (loss) for the period                $   19,684    $  (48,939)
    Items not involving cash:
      Depreciation and depletion                         8,449         5,107
      Stock-based compensation                          22,162         9,370
      Future income taxes                               (3,973)       (1,905)
      Unrealized foreign exchange (gain) loss          (22,622)       42,662
      Other                                                  -           120
    Changes in non-cash working capital:
      Accounts receivable                              (39,068)       (4,743)
      Accrued interest receivable on loans to
       joint ventures                                     (748)            -
      Prepaid expenses                                     309         1,012
      Inventory                                           (475)       (3,042)
      Accounts payable and accrued liabilities           7,019        (4,159)
      Income taxes payable                              (2,112)         3080
    -------------------------------------------------------------------------
    Cash used in operating activities                  (11,375)       (1,437)
    -------------------------------------------------------------------------
    Financing activities
      Issue of common shares, net of issue costs           483       570,859
      Repayment of short-term loan                           -          (106)
    -------------------------------------------------------------------------
      Cash provided by financing activities                483       570,753
    -------------------------------------------------------------------------
    Investing activities
      Acquisition of interest in Betpak, net of
       cash acquired                                         -      (356,224)
      Acquisition of interest in Kyzylkum, net
       of cash acquired                                      -       (38,925)
      Acquisition of Signature, net of cash acquired         -           465
      Cash advances to joint ventures                  (27,150)      (25,440)
      Acquisitions of mineral properties, plant and
       equipment                                       (13,509)      (12,319)
      Advance cash payment for other assets            (16,054)       (8,675)
      Restricted cash                                    2,000        (2,500)
    -------------------------------------------------------------------------
      Cash used in investing activities                (54,713)     (443,618)
    -------------------------------------------------------------------------

    Effect of exchange rate change on cash and cash
     equivalents                                          (885)            -
    Net cash (outflow) inflow for the period           (66,490)      125,698
    Cash and cash equivalents, beginning of period     128,328         2,630
    -------------------------------------------------------------------------
    Cash and cash equivalents, end of period        $   61,838    $  128,328
    -------------------------------------------------------------------------
    -------------------------------------------------------------------------


    Supplemental Information
      Income taxes paid                             $   13,530    $    6,136
      Interest paid                                 $        -    $       45
    Non-cash transactions
      Common shares, warrants and options issued
       to acquire Signature                         $        -    $      424
      Common shares issued to acquire the Kharassan
       project                                      $        -    $   37,500
    




For further information:

For further information: Investor Relations at 1-866-798-0824 or (604)
608-0824

Organization Profile

URASIA ENERGY LTD.

More on this organization


Custom Packages

Browse our custom packages or build your own to meet your unique communications needs.

Start today.

CNW Membership

Fill out a CNW membership form or contact us at 1 (877) 269-7890

Learn about CNW services

Request more information about CNW products and services or call us at 1 (877) 269-7890