UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934
March 16, 2015
Date of Report (Date of
earliest event reported)
Uranerz Energy Corporation
(Exact name of registrant as specified in its charter)
Nevada |
001-32974 |
98-0365605 |
(State or other jurisdiction of |
(Commission File Number) |
(IRS Employer |
incorporation) |
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Identification No.) |
1701 East E Street |
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PO Box 50850 |
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Casper, Wyoming, USA |
82605 |
(Address of principal executive offices) |
(Zip Code) |
(307) 265-8900
Registrant's telephone
number, including area code
Not Applicable
(Former name or former
address, if changed since last report)
Check the appropriate box below if the Form 8-K is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions:
[ ] |
Written communications pursuant to Rule
425 under the Securities Act (17 CFR 230.425) |
[X] |
Soliciting material pursuant to Rule 14a-12
under the Exchange Act (17 CFR 240.14a-12) |
[ ] |
Pre-commencement communications pursuant to
Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
[ ] |
Pre-commencement communications pursuant to
Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
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Item 7.01 |
Regulation FD Disclosure
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On March 16, 2015, Uranerz Energy Corporation (the
Company or Uranerz) filed the following technical reports with
certain securities regulatory authorities in Canada pursuant to Canadian
securities laws:
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a technical report entitled Nichols Ranch Uranium
Project 43-101 Technical Report - Preliminary Economic Assessment
Campbell and Johnson Counties, Wyoming , USA dated February 28, 2015 (the
Nichols Ranch PEA); and |
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a technical report entitled Arkose Uranium Project
Mineral Resource and Exploration Target 43-101 Technical Report
Wyoming, USA dated February 28, 2015 (the Arkose Technical
Report). |
The Nichols Ranch PEA was prepared in accordance with the
requirements of National Instrument 43-101 of the Canadian Securities
Administrators (NI 43-101) by Douglas L. Beahm, P.E., P.G., of BRS,
Inc. and Mr. Paul Goranson, P.E., Chief Operating Officer of the Company, who
are both Qualified Persons as defined by NI 43-101. The Arkose Technical Report
was prepared in accordance with the requirements of NI 43-101 by Douglas L.
Beahm, P.E., P.G., of BRS, Inc., a Qualified Person as defined by NI 43-101. As
a company listed on the Toronto Stock Exchange and a reporting issuer under
the securities laws of certain Canadian provinces, the Company was required to
prepare the Nichols Ranch PEA and the Arkose Technical Report in accordance with
NI 43-101 pursuant to Canadian securities laws.
The information presented in the Nichols Ranch PEA and the
Arkose Technical Report is summarized below. Investors should review the
Cautionary Note to U.S. Investors below in reviewing this
information:
Summary of the Nichols Ranch PEA
The Nichols Ranch PEA was prepared in accordance with NI 43-101
and in accordance with Canadian Institute Mining (CIM) Best Practice
Guidelines for the Estimation of Mineral Resources and Mineral Reserves (CIM
standards) and has an effective date for mineral resources and pertinent
data of January 1, 2015. The effective date of the Nichols Ranch PEA is the same
as the overall report, February 28, 2015.
The Nichols Ranch PEA updates the initial 43-101 Technical
Report on the Nichols Ranch Uranium Project entitled Preliminary Assessment,
Nichols Ranch Uranium In-Situ Recovery Project, Powder River Basin, Wyoming,
U.S.A. dated July 25, 2008. This updated report incorporates:
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an update to the Companys original mining plan for the
Project to include production from the Jane Dough Unit; |
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the revised mining plan to complete construction and
commencement of production from Jane Dough Unit in advance of development
of the Hank Unit; |
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production from approximately 593,000 tons of inferred
resources commencing in year 2021, representing approximately 8% of
anticipated production; and |
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construction of a pipeline to the Hank Unit to enable
fluids to be processed at the Nichols Ranch processing plant in order to
eliminate the construction of a separate ion exchange facility at the Hank
Unit. |
Although the Company has commenced extraction operations from
the Nichols Ranch Unit, extraction operations remain at an early stage and
economic viability has not yet been demonstrated. Extraction from the Jane Dough
Unit remains subject to completion of licensing and permitting, and the Hank
Unit will require additional drilling. There is no certainty that the results of
the Nichols Ranch PEA will be achieved.
The Nichols Ranch Uranium Project (Project) is an advanced
stage project which is licensed to operate by the US Nuclear Regulatory
commission (NRC) and the Wyoming Department of Environmental Quality (WDEQ).
Construction of the processing facility began in 2011. Plant construction and
initial wellfield installation was competed in 2014 and operations were
initiated in April, 2014. Extraction of approximately 199,000 pounds of uranium
oxide has been reported for 2014 via In Situ Recovery (ISR) mining. The Nichols
Ranch facility is licensed at an annual capacity of 2 million pounds uranium
oxide.
The Nichols Ranch PEA includes disclosure permitted under
Section 2.3(3) of NI 43-101 as the Nichols Ranch PEA includes a portion of the
inferred mineral resources reported in the Nichols Ranch PEA. Mineral resources
are not mineral reserves and do not have demonstrated economic viability. The
Nichols Ranch PEA is preliminary in nature, and includes inferred mineral
resources that are considered too speculative geologically to have economic
considerations applied to them that would enable them to be categorized as
mineral reserves, and there is no certainty that the preliminary economic
assessment will be realized.
1.1 Project Overview
The Project is located within the Powder River Basin (PRB) of
Wyoming approximately 80 miles northeast of Casper, Wyoming. The PRB is one of
the largest uranium mining districts in Wyoming and currently accounts for the
majority of Wyomings uranium production. Current uranium production in the PRB
of Wyoming and at Nichols Ranch is completed via in situ recovery (ISR) mining
methods. This report addresses mineral resources and provides a PEA of the
project.
1.2 Project Description and Ownership
The Nichols Ranch Project area includes three areas: Nichols
Ranch, Jane Dough, and Hank. Mineral tenure consists of unpatented mining lode
claims and mineral leases covering approximately 5,434 acres including:
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Nichols Ranch Area: mining claims and fee lands
covering approximately 920 acres. |
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Jane Dough Area: mining claims and fee lands
covering approximately 3,121 acres. |
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Hank Area: mining claims and fee lands covering
approximately 1,393 acres. |
1.3 Development Status
Nichols Ranch is an operating ISR extraction project. Jane
Dough and Hank have been extensively drilled but as yet are undeveloped.
1.4 History
The project is located within the Pumpkin Buttes Mining
District within the PRB which was the first commercial uranium production center
in Wyoming. Uranium was discovered in the area in 1951 and production for small
open pit mines proceeded intermittently from 1953 through 1967. Beginning in the
1970s and operating into the 1980s several large scale open pit and
underground mines with conventional uranium processing facilities (mills) were
developed and operated in the PRB. With falling uranium prices in the 1980s the
conventional operations ceased and the first uranium production using ISR
methods was developed in the PRB.
Mineral rights in the project area were held by several mining
companies who explored the area by drilling. In December 2005, Uranerz purchased
the Nichols Ranch, Jane Dough, and Hank claims groups as part of a six property
agreement to option from Excalibur Industries. Uranerz then expanded the
properties by staking additional claims, through the Arkose Joint Venture, in
the immediate and surrounding areas.
1.5 Regulatory Status
Nichols Ranch and Hank are fully licensed and permitted for ISR
mining by major licenses and permits issued by the US Nuclear Regulatory
Commission (NRC) and the State of Wyoming Department of Environmental Quality,
Land Quality Division (WDEQ/LDQ). Hank does have 280 acres of federal surface
that is currently undergoing the Plan of Operations (POO) permitting process by
the Bureau of Land Management (BLM). Until the POO is completed, no mining
activities may occur on the BLM land. Environmental baseline studies have been
completed at Jane Dough and amendments to the NRC and WDEQ/LQD licenses and
permits have been submitted.
Nichols Ranch and Hank have some 3,370 acres permitted and Jane
Dough has an additional 3,680 acres approximately applied for and under
review.
1.6 Geology and Mineralization
Uranium mineralization in the Project area is hosted by
sandstone units within the Tertiary Wasatch and Fort Union Formations. Uranium
deposits which have been delineated within the Project are classified sandstone
roll front sandstone uranium deposits. Mineralization is interpreted to be
dominantly roll front type mineralization which was deposited along an interface
between oxidizing ground water solutions and reducing conditions within the host
sandstone unit. This boundary between oxidizing and reducing conditions is often
referred to as the REDOX interface or front.
Roll front mineralization tends to be continuous for thousands
of feet along the REDOX front but may have limited width and continuity
perpendicular to the front. Roll fronts are often present in multiple sand
horizons and may occur as multiple or stacked fronts.
Uranium mineralization at Nichols Ranch and Jane Dough is
hosted primarily by the 100 Sand of the Wasatch Formation while the uranium
mineralization at Hank is hosted primarily by the 150 Sand of the Wasatch
Formation.
1.7 Mineral Resources
For this investigation drill data was available for some 1,979
drillholes. The effective date of the mineral resource estimate is January 1,
2015. Mineral resources were estimated using the GT Contour method. The primary
data used in evaluation is equivalent uranium values as quantified by downhole
geophysical logging reported as %eU3O8. Radiometric equilibrium was evaluated
and a disequilibrium factor (DEF) of 1 was used. The minimum uranium grade
included in the estimate was 0.02 %eU3O8. Mineral resources are reported at a
cutoff of 0.20 GT which is the cutoff applied at the Nichols Ranch operation.
The following table provides a summary of mineral resource by
classification following CIM guidelines. Detailed mineral resource estimates are
provided in the Nichols Ranch PEA.
Cautionary Note to Investors Concerning Estimates
of Measured, Indicated and Inferred Resources |
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The following table uses the terms measured resources,
indicated resources and inferred resources. Uranerz advises investors
that while these terms are recognized and required by Canadian securities
regulations (under National Instrument 43-101 Standards of Disclosure
for Mineral Projects), the U.S. Securities and Exchange Commission
does not recognize these terms. Investors are cautioned not to
assume that any part or all of mineral deposits in these categories
will ever be converted into reserves. |
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Further, inferred resources have a great amount of
uncertainty as to their existence, and great uncertainty as to their
economic and legal feasibility. It cannot be assumed that all or any part
of an inferred mineral Resource will ever be upgraded to a higher
category. Under Canadian rules, estimates of inferred mineral resources
may not form the basis of feasibility or pre-feasibility studies, except
in rare cases. Investors are cautioned not to assume that part or all
of an inferred resource exists, or is economically or legally
mineable. |
Mineral Resources
Project Total Remaining
Measured and Indicated Mineral Resources** |
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Tons |
%eU3
O8 |
Pounds |
URZ Pounds* |
Measured |
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604,000 |
0.132 |
1,694,000 |
1,596,000 |
Indicated |
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2,770,000 |
0.111 |
6,171,000 |
5,500,000 |
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M&I Total |
3,410,000 |
0.115 |
7,865,000 |
7,194,000 |
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Project Total Inferred Mineral
Resources |
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Tons |
%eU3 O8 |
Pounds |
URZ Pounds* |
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Inferred Total |
593.000 |
0.100 |
1,184,000 |
1,112,000 |
*Uranerz Pounds 100% of Nichols Ranch and Hank; Jane Dough 100%
in part and 81% in part.
**Remaining Measured Mineral Resource includes
reduction for production from startup through January 1, 2015.
**All numbers
are rounded.
The Nichols Ranch PEA includes disclosure permitted under
Section 2.3(3) of NI 43-101 as the Nichols Ranch PEA includes a portion of the
inferred mineral resources reported in the Nichols Ranch PEA. Mineral resources
are not mineral reserves and do not have demonstrated economic viability. The
Nichols Ranch PEA is preliminary in nature, and includes inferred mineral
resources that are considered too speculative geologically to have economic
considerations applied to them that would enable them to be categorized as
mineral reserves, and there is no certainty that the preliminary economic
assessment will be realized.
1.8 Conclusions
The data available for this report is considered, by the
authors of the Nichols Ranch PEA, to be accurate and reliable for the purposes
of estimating mineral resources for the Project. Significant mineral resources
remain within the Project which can be developed by ISR methods and processed
through the Central Processing Plant (CPP) located at Nichols Ranch.
In the opinion of the authors of the Nichols Ranch PEA, Uranerz
has recruited a well-qualified and experienced staff with respect to ISR mine
operations and uranium exploration and development. Although the project is in
the production start-up phase and has not been in operation long enough to
assess actual recovery, the project has demonstrated the ability to extract
uranium.
Mineral resources have been estimated in accordance with CIM
standards and definitions. Mineral resources are classified as measured,
indicated and inferred as summarized above in the table entitled Mineral
Resources.
The Nichols Ranch Unit processing facility and the allocation
of resources to the production areas within Nichols Ranch, Jane Dough and Hank
Units are designed to generate between 500,000 and 1,000,000 lbs U3O8 per year
of production for approximately 10 years according to the current schedule.
Assuming an overall recovery of 70%, approximately 6.5 million pounds of uranium
oxide will be recovered from all three Units of the Nichols Ranch Project.
The base cost model is in constant US dollars (2015) and
utilizes a constant commodity price of US$65 per pound of uranium oxide.
However, Uranerz has existing contracts for uranium delivery and the price
forecast for the period of 2015-2020 is based on the weighted average of current
contracts and the forward price assumption of US$65/lb.
Key project costs include:
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Sunk costs total US$53.5 million; |
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Forward capital costs are estimated at US$89.8
million; and |
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Total operating cost including taxes and
royalties are estimated at US$20.76/lb. |
This analysis considers the fact that certain expenditures have
already been made to date to construct the processing plant, initial wellfields
and related infrastructure that are sunk costs and are not relevant to future
decision making in connection with Nichols Ranch Project. Accordingly, sunk
costs are not included in the NPV calculations and as a result, presentation of
an Internal Rate of Return is not appropriate.
After-tax returns are expected to be similar to before-tax
returns for the Nichols Ranch Project as Uranerz files federal tax returns in
the United States and had a tax loss carry-forward of US$56.7 million at the end
of 2014. This loss carry-forward will be utilized in future years as profits
offset the prior losses. Federal income taxes have not been included in the cash
flow model due to the uncertain timing in the loss carry forward usage,
uncertain tax rates, and related impacts of alternative minimum tax.
1.9 Recommendations
The authors of the Nichols Ranch PEA recommended that Uranerz
continue its current focus on the Nichols Ranch portion of the Nichols Ranch
Project, including further delineation of the mineralized trends proceeding
southward from the current wellfield operations both east and west of the plant
site. This should be followed by systematic delineation and/or exploratory
drilling at Jane Dough beginning in the areas most proximate to Nichols Ranch
and proceeding southward. Assuming that the exploration and delineation drilling
program were successful, the project could move forward in a phased approach
ultimately to the development of a satellite ISR production facility, which is
an alternative identified in the Nichols Ranch PEA. The Nichols Ranch PEA
includes a phased budget. Each step in the process is contingent on the outcome
of the previous step. If fully implanted this alternative would require
approximately US$33.9 million and would essentially double the current
extraction capacity at Nichols Ranch.
Additional drilling is needed at the Hank Unit to assess
mineral resources. As part of the planning process for additional drilling at
the Hank Unit, detailed interpretation of the mineralized fronts within the
overall 150 sand should be completed. Once the mineral resource base at the Hank
Unit can be better assessed, cost/benefits studies should be completed to
evaluate the current option of piping wellfield solution from Hank to Nichols
Ranch as compared to construction of a satellite facility. Table 26.2 (Section
26) provides a summary of estimated costs for further evaluation of Hank which
total approximately US$600,000 US.
1.10 Summary of Risks
It is the opinion of the authors of the Nichols Ranch PEA that
the risks associated are low as the Nichols Ranch Project has operating permits
and facilities in place. Each new wellfield will require additional permitting
as will any satellite operations. However, Uranerz has demonstrated the ability
to obtain the necessary operating permits.
The Nichols Ranch Project does have some risks similar in
nature to other mining projects in general and uranium mining projects
specially. Risks common to mining projects include:
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Future commodity demand and pricing; |
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Environmental and political acceptance of the
project; |
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Variance in capital and operating costs; and
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Mine and mineral processing recovery.
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There is a risk that mineralization may not be found and/or be
continuous along the REDOX boundary and that the actual GT along the trends will
fall outside the estimated range, either higher or lower.
The authors of the Nichols Ranch PEA are not aware of
environmental, permitting, legal, title, taxation, socio-economic, marketing,
political, or other relevant factors which would materially affect the mineral
resource estimates. To the knowledge of the authors of the Nichols Ranch PEA
there are no other significant factors that may affect access, title, or the
right or ability to perform work on the property, provided the conditions of all
mineral leases and options, and relevant operating permits and licenses are met.
The reader is cautioned that additional drilling on the project may or may not
result in discovery of additional mineral resources on the property.
Uranerz made a determination to proceed with extraction
activities at the Nichols Ranch in 2013. The production decision was not based
on a feasibility study of mineral reserves demonstrating economic and technical
viability, and as a result, there may be an increased uncertainty in achieving
any particular level of recovery of minerals or the cost of such recovery,
including increased risks associated with developing a commercially mineable
deposit. Historically, such projects have a much higher risk of economic and
technical failure. There is no guarantee that production will continue as
anticipated or at all or that anticipated production costs will be achieved.
Failure to achieve anticipated production results and production costs may have
a material adverse impact on Uranerzs ability to generate revenue and its
future profitability. The Nichols Ranch PEA is preliminary in nature. Mineral
resources are not mineral reserves and do not have demonstrated economic
viability. There is no certainty that the Nichols Ranch PEA will be
realized.
Summary of the Arkose Technical Report
The Arkose Technical Report was prepared in accordance with NI
43-101 and CIM standards and has an effective data for mineral resources and
pertinent data the same as the overall report, February 28, 2015.
The Arkose Technical Report provides estimates of inferred
mineral resources and an exploration target for the Arkose Uranium Project
(Arkose) located in the Powder River Basin of Wyoming.
Mineral resources are not mineral reserves and do not have
demonstrated economic viability in accordance with CIM standards. Inferred
Mineral Resources are too speculative geologically to have the economic
considerations applied to them which would enable them to be categorized as
mineral reserves.
Reporting exploration targets is allowed as a restricted
disclosure, as allowed under NI 43-101 Part 2.3.2, which defines, disclosing the
potential quantity and grade of mineralization, expressed as ranges, for further
exploration. All tonnages, grade, and contained pounds of uranium, as stated in
the Arkose Technical Report, for exploration targets should not be construed to
reflect a calculated mineral resource (inferred, indicated, or measured). The
potential quantities and grades for exploration targets are conceptual in nature
and there has been insufficient work to date to define a NI 43-101 compliant
resource. Furthermore, it is uncertain if additional exploration will result in
discovery of an economic mineral resource within these areas.
1.1 Project Overview
The total area of the Arkose Mining Venture Properties which
comprise the Arkose project is approximately 49,138.00 acres. The Arkose project
is located in various sections of Townships 41-44 North, Ranges 74-78 West; and
falls between Latitudes 43° 47 and 43° 31 North, and Longitudes 106° 10 and
105° 18 West, approximately 60 air miles north from Casper, Wyoming. Mineral
tenure consists of unpatented mining claims, mineral leases (fee and state), and
Surface Use Agreements as identified on Appendix A to the Arkose Technical
Report. Uranerz holds an 81% undivided interest in the mineral title to the
Arkose project subject to its joint venture with United Nuclear, LLC successor
in interest to NAMMCO.
1.2 Project Description
The Arkose project has been subdivided into 12 exploration
areas. The following table summarizes the areas, lists whether an exploration
target and/or inferred mineral resource was estimated for that area.
Arkose Area Summary
Area |
Exploration Target |
Inferred Mineral Resource
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East Buck |
Estimated |
Estimated |
Kermit |
Estimated |
No Estimate |
Little Butte |
Estimated |
Estimated |
Sand Rock |
Estimated |
No Estimate |
Monument |
Estimated |
Estimated
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South Collins Draw |
Estimated |
No Estimate |
Cedar Canyon |
Estimated |
No Estimate |
Sough Doughstick |
Estimated |
No Estimate |
Lone Bull |
No Estimate |
No Estimate |
Stage |
No Estimate |
No Estimate |
Beecher Creek |
Estimated |
No Estimate |
House Creek |
No Estimate |
No Estimate |
The Arkose project is an early stage exploration project.
1.3 Development and Regulatory Status
There has been no development activity on the Arkose project.
The only permits necessary for the Project are for exploration by drilling.
Uranerz has a Drilling Notification approved by the State of Wyoming Department
of Environmental Quality, Land Quality Division (WDEQ/LQD) and the BLM.
1.4 History
The Arkose project is located within the Pumpkin Buttes Mining
District within the PRB which was the first commercial uranium production center
in Wyoming. Uranium was discovered in the area in 1951 and production from small
open pit mines proceeded intermittently from 1953 through 1967. Beginning in the
1970s and operating into the 1980s several large scale open pit and
underground mines with conventional uranium processing facilities (mills) were
developed and operated in the PRB. With falling uranium prices in the 1980s the
conventional operations ceased and the first uranium production using ISR
methods was developed in the PRB. Historically, mineral rights in the project
area were held by several mining companies who explored the area by
drilling.
NAMMCO commenced acquiring rights to the properties comprising
the Arkose Property in 2005, and continued to do so through 2006 and 2007. On
January 15, 2008, Uranerz completed an acquisition of an undivided eighty-one
percent interest in the Arkose Property and formed the Arkose Mining Venture
with United Nuclear, LLC successor in interest to the vendors of these
properties, NAMMCO.
Uranerz holds an 81% undivided interest in the mineral title to
Arkose subject to its joint venture with United Nuclear, LLC successor in
interest to NAMMCO.
1.5 Geology and Mineralization
In the project area uranium mineralization is hosted by
sandstone units within the Tertiary Wasatch and Fort Union Formations. Uranium
deposits which have been delineated within the Arkose project are classified
sandstone roll front uranium deposits. Mineralization is interpreted to be
dominantly roll front type mineralization which was deposited along an interface
between oxidizing ground water solutions and reducing conditions within the host
sandstone unit. This boundary between oxidizing and reducing conditions is often
referred to as the REDOX interface or front.
Roll front mineralization tends to be continuous for thousands
of feet along the REDOX front but may have limited width and continuity
perpendicular to the front. Roll fronts are often present in multiple sand
horizons and may occur as multiple or stacked fronts.
Uranium mineralization is hosted within the Arkose project area
within sand horizons of the Tertiary Wasatch and Fort Union formations. The
stratigraphic section provides the naming convention used for Arkose with the
sand horizons in the Wasatch beginning with the lowest sand designated as the
100 sand and increasing by increments of 10 upward in the section to the 150
sand. Sand horizons in the Fort Union begin with the 90 sand in the upper
portions of the formation and count downward by increments of 10 to the 50 sand.
The boundary between the Wasatch and Fort Union Formation is marked by a coal
and/or lignite horizon. The Arkose project focuses primarily on the 50 to 140
sands.
1.6 Exploration Targets
The Arkose Technical Report identified those portions of the
Arkose project which could be identified as exploration targets on the basis
that there is sufficient geologic evidence from limited drilling to interpret
that mineralization may extend from areas of resource production and/or defined
mineral resources and/or is present within the drillholes themselves. In these
areas favorable conditions for the occurrence of mineralization was determined
based on the presence of host sand units and evidence of REDOX interfaces within
those host sand units. No estimate of mineral resources or reserves in
accordance with CIM guidelines has been made for exploration target areas. The
Arkose Technical Report includes a quantification of the exploration target
portions of the Arkose Project, as allowed under NI 43-101. All tonnages, grade,
and contained pounds of uranium associated with the exploration targets, as
stated in the Arkose Technical Report, should not be construed to reflect a
calculated mineral resource (inferred, indicated, or measured). The potential
quantities and grades, as stated in the Arkose Technical Report, are conceptual
in nature and there has been insufficient work to date to define a NI 43-101
compliant resource. Furthermore, it is uncertain if additional exploration will
result in discovery of an economic mineral resource on the property.
1.7 Mineral Resources
For this investigation drill data was available in over 2,000
drillholes. Inferred mineral resources were estimated by projecting average
width and GT along a measured REDOX trend defined by drillholes. The effective
date of the mineral resource estimate is February 28, 2015. Radiometric
equilibrium was evaluated and a disequilibrium factor (DEF) of 1 was used. The
minimum uranium grade included in the estimate was 0.02 %eU3O8. Mineral
resources are reported at a cutoff of 0.20 GT. The following table provides a
summary of estimated mineral resources by classification following CIM
guidelines. Detailed mineral resource estimates are provided in the Arkose
Technical Report.
Cautionary Note to Investors Concerning Estimates
of Measured, Indicated and Inferred Resources |
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The following table uses the term inferred resources.
Uranerz advises investors that while this term is recognized and required
by Canadian securities regulations (under National Instrument 43-101
Standards of Disclosure for Mineral Projects), the U.S. Securities
and Exchange Commission does not recognize this term. Further, inferred
resources have a great amount of uncertainty as to their existence, and
great uncertainty as to their economic and legal feasibility. It cannot be
assumed that all or any part of an inferred mineral Resource will ever be
upgraded to a higher category. Under Canadian rules, estimates of inferred
mineral resources may not form the basis of feasibility or pre-feasibility
studies, except in rare cases. Investors are cautioned not to assume
that part or all of an inferred resource exists, or is economically
or legally mineable. |
Inferred Mineral Resources**
Project Total Inferred Mineral
Resources |
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Tons |
%eU3O8 |
Pounds |
URZ Pounds* |
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Inferred Total |
2,058.000 |
0.100 |
4,066,000 |
3,294,000
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*Uranerz Pounds 81% of total.
**All numbers are
rounded.
Mineral resources are not mineral reserves and do not have
demonstrated economic viability in accordance with CIM standards. Inferred
mineral resources are too speculative geologically to have the economic
considerations applied to them which would enable them to be categorized as
mineral reserves. Inferred mineral resources have been assessed in the context
of preliminary economic assessment (PEA) in this report which is allowed as a
restricted disclosure under section 2.3(3) of NI 43-101.
1.8 Conclusions
The data available for this report is considered, by the
authors of the Arkose Technical Report, to be accurate and reliable for the
purposes of estimating mineral resources and exploration targets for the
Project.
Mineralization within the project is considered to have a
reasonable prospect for economic extraction via is in situ recovery methods
(ISR).
Mineral resources have been estimated in accordance with CIM
standards and definitions and are summarized. Mineral resources are classified
as inferred as summarized in the table above entitled Inferred Mineral
Resources.
1.9 Recommendations
It is recommended that exploration and development of the
Arkose project be continued. The areas considered of highest priority for
development would include:
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The South Doughstick area as it is adjacent to
the Jane Dough area which is currently being permitted for ISR mining as
part of the Nichols Ranch facility. |
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The Monument area as it has a significant
exploration target. |
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The East Buck area which has both estimated
inferred mineral resources and exploration targets which are significant.
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The Little Butte area which has both estimated
inferred mineral resources and exploration targets which are significant.
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Expenditures for exploration and development of Arkose will be
significant as the primary exploration method will consist of drilling and the
area to be explored is extensive. Average depths of mineralization defined be
drilling to date are in the range of 500 to 1,000 feet. The Arkose Technical
Report provides an estimate for additional exploration at South Doughstick,
Monument, East Buck Little Butte, specifically, and other areas in general. The
Arkose Technical Report also provides an estimate for delineation drilling in at
least two of these areas. It is recommended that the drilling be done in phases
with each phase evaluated as work progresses before proceeding to the next
phase. Recommended exploration drilling costs are estimated at US$3 million and
delineation of two of the target areas at US$3.3 million.
The other areas within Arkose remain prospective. Exploration
targets have been estimated for Kermit, Sand Rock, South Collins Draw, Cedar
Canyon, and Beecher Creek. Drilling at Lone Bull, Stage, and House Creek to date
is insufficient to define an exploration target but these areas remain
perspective.
1.10 Summary of Risks
It is the opinion of the authors of the Arkose Technical Report
that the risks associated are low considering the project is in an early
exploration stage. The Arkose project is located within a geologic environment
that is known to host uranium mineralization and has and continues to be mined
within the vicinity. Drilling to date at the Arkose project has defined uranium
mineralization in several areas.
The Arkose project does have some risks similar in nature to
other mining projects in general and uranium mining projects specially, i.e.,
risks common to mining projects include:
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future commodity demand and pricing; |
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environmental and political acceptance of the
project; |
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variance in capital and operating costs; |
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mine and mineral processing recovery; and
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it is uncertain if additional exploration will
result in discovery of an economic mineral resource within these areas.
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Expenditures for exploration and development of the Arkose
project will be significant as the primary exploration method will consist of
drilling. Average depths of mineralization defined by drilling to date are in
the range of 500 to 1,000 feet.
There is a risk that mineralization may not be found and/or be
continuous along the REDOX boundary and that the actual GT along the trends will
fall outside the estimated range, either higher or lower.
There is a risk that additional drilling will not increase
mineral resources or validate exploration targets.
Cautionary Note for U.S. Investors
All mineral resources have been estimated in accordance with
the definition standards on mineral resources and mineral reserves of the
Canadian Institute of Mining, Metallurgy and Petroleum referred to in NI 43-101.
U.S. reporting requirements for disclosure of mineral properties are governed by
the United States Securities and Exchange Commission (SEC) Industry
Guide 7 (Guide 7). NI 43-101 and Guide 7 standards are substantially
different. The terms mineral reserve, proven mineral reserve and probable
mineral reserve are Canadian mining terms as defined in accordance with NI
43-101. These definitions differ from the definitions in Guide 7. Under Guide 7
standards, a final or bankable feasibility study is required to report
reserves, the three-year historical average price is used in any reserve or cash
flow analysis to designate reserves and the primary environmental analysis or
report must be filed with the appropriate governmental authority.
The Nichols Ranch PEA and the Arkose Technical Report use the
terms mineral resource, measured mineral resource, indicated mineral
resource and inferred mineral resource. We advise investors that these terms
are defined in and required to be disclosed by NI 43-101; however, these terms
are not defined terms under Guide 7 and are normally not permitted to be used in
reports and registration statements filed with the SEC. Investors are cautioned
not to assume that any part or all of mineral deposits in these categories will
ever be converted into reserves. Inferred mineral resources have a great
amount of uncertainty as to their existence, and great uncertainty as to their
economic and legal feasibility. It cannot be assumed that all or any part of an
inferred mineral resource will ever be upgraded to a higher category. Under
Canadian rules, estimates of inferred mineral resources may not form the basis
of feasibility or pre-feasibility studies, except in rare cases. Investors are
cautioned not to assume that all or any part of an inferred mineral resource
exists or is economically or legally mineable. Disclosure of contained pounds
in a resource is permitted disclosure under Canadian regulations; however, the
SEC normally only permits issuers to report mineralization that does not
constitute reserves by SEC standards as in place tonnage and grade without
reference to unit measures.
The Nichols Ranch PEA and the Arkose Technical Report are
furnished and not filed pursuant to Item 7.01. Such information shall not be
deemed to be filed for purposes of Section 18 of the Exchange Act, or
otherwise subject to the liabilities of that section, and shall not be deemed to
be incorporated by reference into any of the Companys filings under the
Securities Act or the Exchange Act whether made before or after the date hereof
and regardless of any general incorporation language in such filings, except to
the extent expressly set forth by specific reference in such a filing.
The complete Nichols Ranch PEA and the Arkose Technical Report
may been found on the website of the Canadian Securities Administrators at
www.sedar.com and on the Companys website at www.uranerz.com. The contents of
these websites, and the information accessible through them, are not part of
this current report on Form 8-K.
Qualified Person
Mr. Paul Goranson, President and Chief Operating Officer of
Uranerz and a Qualified Person under NI 43-101 has approved the written
disclosure in this Form 8-K relating to the Nichols Ranch PEA and the Arkose
Technical Report.
Please see the disclosures set forth under Item 7.01
Regulation FD Disclosure, which are incorporated by reference into this Item
8.01.
The summary information for Nichols Ranch PEA and the Arkose
Technical Report is furnished and not filed pursuant to Item 8.01. Such
information shall not be deemed to be filed for purposes of Section 18 of the
Exchange Act, or otherwise subject to the liabilities of that section, and shall
not be deemed to be incorporated by reference into any of the Companys filings
under the Securities Act or the Exchange Act whether made before or after the
date hereof and regardless of any general incorporation language in such
filings, except to the extent expressly set forth by specific reference in such
a filing.
Additional Information
As previously disclosed, on January 5, 2015, the Company
entered into an Agreement and Plan of Merger (the Merger Agreement)
with Energy Fuels Inc., an Ontario corporation (Energy Fuels), and EFR
Nevada Corp., a Nevada corporation and wholly owned subsidiary of a subsidiary
of Energy Fuels (Merger Sub). The Merger Agreement provides for a
business combination whereby Merger Sub will merge with and into the Company
(the Merger), and as a result the Company will continue as the
surviving operating corporation and as an indirectly wholly owned subsidiary of
Energy Fuels.
This communication may be deemed to be solicitation material in
respect of the proposed business combination of the Company and Energy Fuels. In
connection with the proposed Merger, Energy Fuels intends to file relevant
materials with the SEC, including a registration statement on Form F-4 that will
include a proxy statement of the Company that also constitutes a prospectus of
Energy Fuels. STOCKHOLDERS OF THE COMPANY ARE URGED TO READ ALL RELEVANT
DOCUMENTS FILED WITH THE SEC, INCLUDING THE REGISTRATION STATEMENT AND THE PROXY
STATEMENT AND PROSPECTUS INCLUDED THEREIN, BECAUSE THEY WILL CONTAIN IMPORTANT
INFORMATION ABOUT THE PROPOSED MERGER. Investors and security holders will be
able to obtain the documents free of charge at the SECs web site,
http://www.sec.gov, and the Companys stockholders will receive information at
an appropriate time on how to obtain transaction-related documents for free from
the Company. Such documents are not currently available.
This communication shall not constitute an offer to sell or the
solicitation of an offer to buy any securities, nor shall there be any sale of
securities in any jurisdiction in which such offer, solicitation or sale would
be unlawful prior to registration or qualification under the securities laws of
any such jurisdiction. No offering of securities shall be made except by means
of a prospectus meeting the requirements of Section 10 of the Securities Act.
Safe Harbor Statement
This Current Report on Form 8-K contains forward-looking
statements that involve risks, uncertainties, and assumptions that are difficult
to predict. Actual results and the timing of events could differ materially from
those anticipated in such forward-looking statements as a result of risks and
uncertainties including, without limitation, the Company has not
established reserves under Guide 7 for any of its properties, the operating
results (including revenues, operating and capital costs) and the economic value
of the Nichols Ranch ISR property may differ from projections, the parties'
ability to consummate the Merger; the conditions to the completion of the
Merger, including the receipt of shareholder and regulatory approvals required
for the Merger may not be obtained on the terms expected or on the anticipated
schedule; the parties' ability to meet expectations regarding the timing,
completion and accounting and tax treatments of the Merger; the volatility of
the international marketplace; future uranium prices; the ability to raise
capital to fund project development; the ability to complete future acquisitions
and other risk factors as described from time to time in the Companys periodic
reports filed with the Securities and Exchange Commission. The Company
undertakes no obligation to update any forward-looking statement, whether
written or oral, that may be made from time to time, whether as a result of new
information, future developments or otherwise.
Item 9.01 |
Financial Statements and Exhibits.
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None
SIGNATURES
In accordance with the requirements of the Securities Exchange
Act of 1934, the registrant has duly caused this report to be signed on its
behalf by the undersigned thereunto duly authorized.
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URANERZ ENERGY CORPORATION
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/s/ Glenn Catchpole |
DATE: March 18, 2015 |
By: |
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Glenn Catchpole |
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Chief Executive Officer
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