NYSE Amex Equities Exchange Symbol - UEC
CORPUS CHRISTI, TX, June 21, 2011 /CNW/ - Uranium Energy Corp (NYSE
AMEX: UEC), (the 'Company') today issued a Mid-Year Shareholder Report.
The report from CEO Amir Adnani follows in its complete form:
I am pleased to present this mid-year report for Uranium Energy Corp.
I want to thank you for your continuing support as a UEC shareholder.
Your confidence in the Company and its management is truly valued and
appreciated. As an emerging uranium producer, UEC has demonstrated
excellent production results so far this year, and is squarely focused
on increasing production, expanding its uranium resources and
generating cash flow from operations in 2011.
The first half of 2011 has been a challenging time for the uranium
sector. I would like to take this opportunity to re-affirm our
expectations for the continued expansion of global nuclear capacity
leading to a long-term increase in uranium demand, and to address our
plans to capitalize on this growth. UEC is ideally positioned to
participate in the recovery of the uranium sector, as this report will
ACHIEVEMENTS AND HIGHLIGHTS IN THE FIRST HALF OF 2011
Production Results: Since commencement of production in November 2010 to May 2011, UEC has
produced approximately 100,000 pounds of U3O8 at a cash operating expense of approximately $15 per pound. Quarter
over quarter, Palangana production costs have declined while production
has more than doubled. Specifically, Palangana produced 49,000 lbs. of
U3O8 in FQ3 versus 21,000 lbs. in FQ2, with FQ4 starting off with 27,000
lbs. of production during May.
Production Ramp-Up: The initial three-phase start-up of Production Area-1 at the Palangana
Mine remains on schedule. In mid-April, Phase II wellfield production
commenced, adding to the Phase I wellfield already in production. Over
one-half of Phase II's 45 production and 30 injection wells are now
operating, with the remainder continuing to come on-line steadily.
Photos: Please click thumbnails to view full sized images:
Satellite Plant (Foreground)
Production Area One (Background)
Phase 3 (Foreground), Phase 2
(Middle), Phase 1 (Background)
First Sales Contract: In June 2011, the Company secured its first multi-year uranium sales
contract. The sales contract provides for the delivery of 300,000
pounds of U3O8 over a period of three years starting in August 2011 from its Hobson
processing facility, with the price to be based on published market
price indicators at the time of delivery.
Bolstering Expertise: Additions and fine-tuning have been implemented to bolster UEC's
management and technical capabilities. New appointments and postings
have been effected to provide for a better distribution of the
experience and talent inherent throughout the Company as UEC continues
to develop as a uranium producer.
Permitting Advances: The Texas Commission on Environmental Quality (TCEQ) has continued to
make progress with the one remaining state-level authorization needed
to initiate construction at Goliad, the Radioactive Materials License
Uranium Resource Increases: Based on Phase I of a two-phase drilling campaign at the Company's
Salvo project, an independent NI 43-101 technical report has identified
an inferred resource estimate of 2.839 MM lbs. of U3O8, almost doubling the previous historical resource of 1.5 MM lbs. The
Company is engaged in further resource expansion drilling with four
rigs at its Palangana and Salvo projects.
New Acquisitions: The Company has acquired a 247,000-acre uranium property located in
the area of Coronel Oviedo, Paraguay. Share dilution to acquire the
project was far below 1%. This property is geologically very similar to
the Company's projects in the South Texas uranium belt and is
anticipated to be ISR-amenable as initially indicated through our
pump-test studies. This opportunity profile is an excellent fit for our
technical team who has a distinctive track record of discovering and
advancing sandstone-hosted uranium deposits. While the Company's
primary focus remains on our production strategy in South Texas,
management continues to seek out new district-scale opportunities such
as this project in stable and business-friendly Paraguay.
Strong Treasury: The Company remains debt-free with over $30 million and only 72.3
million shares outstanding.
ADDITIONAL MILESTONES FOR 2011 AND BEYOND
During the first half of 2011, we continue to demonstrate that UEC has
the technical and management experience at all levels to carry through
to successful operations. Our key objectives for the balance of 2011
are to expand uranium production from South Texas, to grow our resource
base and to generate cash flow.
Palangana ISR Project: Production ramp-up from the third and final phase at Production Area 1
is expected to commence from the Phase III wellfield in September 2011.
Moving forward, production growth at Palangana is expected to come from
additional production areas. The Company's permitting and development
teams are working to bring Palangana's Production Area 2 closer to
production. Meanwhile, the Company's exploration group commenced a
drilling program during FQ3 consisting of approximately 50 holes at the
proposed Production Area 3 wellfield. Resource expansion efforts are
continuing in other areas at Palangana.
Goliad ISR Project: The Company expects Goliad to become its second uranium-producing asset
in South Texas. UEC will commence construction at Goliad upon approval
of the Radioactive Materials License. The Company anticipates this one
remaining license to be approved in July this year.
Salvo Project: Phase II drilling is ongoing and expected to continue through the summer
of 2011 to further expand the resource by drilling prospective new
zones and to bring much of the current Inferred Resource Estimate into
the Measured and Indicated categories. Metallurgical and other tests
will also be performed to reaffirm ISR amenability at Salvo.
Coronel Oviedo, Paraguay: Exploration is expected to begin in the next 60 to 90 days on this new
district-scale opportunity. We look forward to reporting further on its
potential. Our objective here is to achieve an initial NI
43-101-compliant resource as quickly as possible.
Initial Cash Flow: With close to 100,000 pounds of U3O8 in inventory at a cash operating expense of approximately $15 per
pound, UEC is well positioned to generate cash flow from operations in
2011. We anticipate that our production will be sold through a
combination of spot market sales and long-term contracts towards
establishing a balanced portfolio of sales points and prices for our
NUCLEAR POWER EXPANSION
Nuclear power remains the only technology available today to generate
carbon-free, reliable, low-cost and base-load electricity for a rapidly
We acknowledge the tragic events in Japan and the short-term challenges
that the nuclear industry is facing. Despite sensationalized headlines,
we are confident that the long-term fundamentals for the nuclear sector
have been only marginally impacted.
Since the accident at Fukushima, Germany's current plan to close its
nuclear reactors by 2022 has been the main planned reduction in nuclear
capacity. However, this is more than offset by nuclear expansion
programs in other countries. China, France, India, Russia, the UK and
the USA remain resolutely committed to nuclear power, given appropriate
revisions to safety regimes. China, on its own, is adding almost five
times the capacity that Germany plans to shut by 2020.
As reported in the Wall Street Journal on June 16, China's government has announced that it has completed its
inspections of all of its operating facilities and that all are safe.
China has 27 new nuclear plants under construction with an additional
52 planned. Saudi Arabia has now announced plans to build 16 new
As of June 2011, 29 countries worldwide are operating 425 nuclear
reactors for electricity generation. With 65 new nuclear plants under
construction in 15 countries and an additional 155 planned, growth
remains nuclear's future.
THE PRICE OF URANIUM
Towards the end of May, the spot uranium market was buoyed by news that
a buyer emerged for the nearly 13 million pounds of U3O8-equivalent that the US Department of Energy (DOE) had planned to
auction over the next three and a half years on a quarterly basis. The
funds from these sales are to be used for environmental cleanup work in
Ohio. The Company believes this is constructive for uranium market
fundamentals because the buyer of this DOE material is anticipated to
sell it in a more disciplined fashion than the auction approach that
DOE was planning.
Post-Fukushima, the spot price of uranium is $54.50/lb. today, which is
notably higher than $40/lb., the price at this time last year. The term
price is $68/lb., modestly lower than before the incident in Japan.
Both spot and long-term prices are in a viable range for UEC because
the Company's recently reported cash operating expense is just $15/lb.,
and our focus is very low-cost production using in-situ recovery
methods and our centralized 'hub-and-spoke' strategy in South Texas.
Looking forward, despite concerns generated by the Japanese
developments, the underlying fundamentals still point to insufficient
supply relative to current and growing demand on a longer-term basis.
We look forward to achieving our milestones and adding value to our
Company during the balance of 2011. Thank you again for your confidence
in management. We welcome your further participation.
Stay tuned by calling us at 1-866-748-1030, emailing firstname.lastname@example.org and visiting www.uraniumenergy.com.
President and CEO
Uranium Energy Corp
About Uranium Energy Corp
Uranium Energy Corp (NYSE-AMEX: UEC) is a U.S.-based uranium production,
development and exploration company operating North America's newest
emerging uranium mine. The Company's fully licensed and permitted
Hobson processing facility is central to all of its projects in South
Texas, including the Palangana in-situ recovery project, which is
ramping up to full production this year, and the Goliad in-situ
recovery project which has been granted its Mine Permit and is in the
final stages of mine permitting for production. The Company's
operations are managed by professionals with a recognized profile for
excellence in their industry, a profile based on many decades of
hands-on experience in the key facets of uranium exploration,
development and mining.
Stock Exchange Information:
Frankfurt Stock Exchange Symbol: U6Z
Notice to U.S. Investors
The mineral resources referred to herein have been estimated in
accordance with the definition standards on mineral resources of the
Canadian Institute of Mining, Metallurgy and Petroleum referred to in
NI 43-101 and are not compliant with U.S. Securities and Exchange
Commission (the "SEC") Industry Guide 7 guidelines. In addition,
measured mineral resources, indicated mineral resources and inferred
mineral resources, while recognized and required by Canadian
regulations, are not defined terms under SEC Industry Guide 7 and are
normally not permitted to be used in reports and registration
statements filed with the SEC. Accordingly, we have not reported them
in the United States. Investors are cautioned not to assume that any
part or all of the mineral resources in these categories will ever be
converted into mineral reserves. These terms have a great amount of
uncertainty as to their existence, and great uncertainty as to their
economic and legal feasibility. In particular, it should be noted that
mineral resources which are not mineral reserves do not have
demonstrated economic viability. It cannot be assumed that all or any
part of measured mineral resources, indicated mineral resources or
inferred mineral resources will ever be upgraded to a higher category.
In accordance with Canadian rules, estimates of inferred mineral
resources cannot form the basis of feasibility or other economic
studies. Investors are cautioned not to assume that any part of the
reported measured mineral resources, indicated mineral resources or
inferred mineral resources referred to in this news release are
economically or legally mineable.
Under NI 43-101 an issuer may disclose an estimate of the quantity and
grade of a historical mineral resource made before the instrument came
into force if the estimate is an estimate of mineral resources prepared
by or on behalf of a person or company other than the issuer and the
disclosure identifies the source and date of the historical estimate,
confirms that the historical estimate is relevant, comments on its
reliability, and explains any differences between the categories used
in the historical resource and those permitted by NI 43-101. Any such resources are historical in nature and were compiled before the
implementation of NI 43-101 reporting standards, and the Company may not have independently verified any such resource so is
not treating them as current resources. Any such historical resources were prepared to industry standards in place at
the time and are considered relevant today. Any such estimate, although prepared by experienced personnel and considered
relevant should not be relied on.
Safe Harbor Statement
Except for the statements of historical fact contained herein, the
information presented in this news release constitutes "forward-looking
statements" as such term is used in applicable United States and
Canadian laws. These statements relate to analyses and other
information that are based on forecasts of future results, estimates of
amounts not yet determinable and assumptions of management. Any other
statements that express or involve discussions with respect to
predictions, expectations, beliefs, plans, projections, objectives,
assumptions or future events or performance (often, but not always,
using words or phrases such as "expects" or "does not expect", "is
expected", "anticipates" or "does not anticipate", "plans, "estimates"
or "intends", or stating that certain actions, events or results "may",
"could", "would", "might" or "will" be taken, occur or be achieved) are
not statements of historical fact and should be viewed as
"forward-looking statements". Such forward looking statements involve
known and unknown risks, uncertainties and other factors which may
cause the actual results, performance or achievements of the Company to
be materially different from any future results, performance or
achievements expressed or implied by such forward-looking statements.
Such risks and other factors include, among others, the actual results
of exploration activities, variations in the underlying assumptions
associated with the estimation or realization of mineral resources, the
availability of capital to fund programs and the resulting dilution
caused by the raising of capital through the sale of shares, accidents,
labor disputes and other risks of the mining industry including,
without limitation, those associated with the environment, delays in
obtaining governmental approvals, permits or financing or in the
completion of development or construction activities, title disputes or
claims limitations on insurance coverage. Although the Company 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 such 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 contained in
this news release and in any document referred to in this news release.
Certain matters discussed in this news release and oral statements made
from time to time by representatives of the Company may constitute
forward-looking statements within the meaning of the Private Securities
Litigation Reform Act of 1995 and the Federal securities laws. Although
the Company believes that the expectations reflected in such
forward-looking statements are based upon reasonable assumptions, it
can give no assurance that its expectations will be achieved.
Forward-looking information is subject to certain risks, trends and
uncertainties that could cause actual results to differ materially from
those projected. Many of these factors are beyond the Company's ability
to control or predict. Important factors that may cause actual results
to differ materially and that could impact the Company and the
statements contained in this news release can be found in the Company's
filings with the Securities and Exchange Commission. For
forward-looking statements in this news release, the Company claims the
protection of the safe harbor for forward-looking statements contained
in the Private Securities Litigation Reform Act of 1995. The Company
assumes no obligation to update or supplement any forward-looking
statements whether as a result of new information, future events or
otherwise. This press release shall not constitute an offer to sell or
the solicitation of an offer to buy securities.
Important Additional Information Will Be Filed With the SEC
In connection with the previously announced proposed merger (the
"Merger") between the Company and Concentric Energy Corp.
("Concentric"), the Company intends to file relevant materials with the
United States Securities and Exchange Commission (the "SEC"), including
a registration statement on Form S-4 (the "Registration Statement"),
which will include a preliminary prospectus and related materials to
register the securities of the Company to be issued in exchange for
securities of Concentric. The Registration Statement will incorporate a
proxy statement (the "Proxy Statement") that Concentric plans to mail
to its stockholders in connection with obtaining stockholder approval
of the Merger. The Registration Statement and the Proxy Statement will
contain important information about the Company, Concentric, the Merger
and related matters. Investors and security holders are urged to read
the Registration Statement and the Proxy Statement carefully when they
are available. Investors and security holders will be able to obtain
free copies of the Registration Statement and the Proxy Statement when
they become available, and other documents filed with the SEC by the
Company, through the web site maintained by the SEC at www.sec.gov. Documents filed by the Company with the SEC may be obtained free of
charge by contacting the Company at: Uranium Energy Corp.; attention:
Mr. Mark Katsumata, CFO; 500 North Shoreline, Suite 800N, Corpus
Christi, Texas, 78401; Tel: (866) 748-1030.
Concentric, and its directors and executive officers, may be deemed to
be participants in the solicitation of proxies from Concentric's
stockholders in connection with the Merger. Information regarding any
special interests of these directors and executive officers in the
Merger will be included in the Proxy Statement.
SOURCE Uranium Energy Corp
For further information:
Contact North America: Investor Relations, Uranium Energy Corp:
Toll Free: (866) 748-1030
Fax: (361) 888-5041