Ur-Energy Inc. (URE) Earnings Call Transcript & Summary

Greetings and welcome to the Annual General and Special Meeting of Shareholders of Ur-Energy Inc. [Operator Instructions] please note, this conference is being recorded. I will now turn the conference over to Ur-Energy's CEO, John Cash. Sir, you may begin.

Thank you, and good afternoon, everyone. Welcome to Ur-Energy's Annual General and Special Meeting of shareholders. My name is John Cash, and I am the CEO and a member of the Board of Directors of the company. I would also like to greet everyone who is listening on the telephone lines and webcast today. I would like to introduce the nonmanagement directors of Ur-Energy who are with us today: Bill Boberg, Rob Chang, Jim Franklin, Gary Huber, Thomas Parker and Kathy Walker. I would now like to introduce the officers of Ur-Energy, who are with us today, Roger Smith, who is our Chief Financial Officer and Chief Administrative Officer; Steven Hatten, Vice President, Operations; and Penne Goplerud, General Counsel and Corporate Secretary. Additionally, I would like to introduce Virginia Schweitzer of Fasken Martineau, our Canadian Legal Counsel; and Len Wadsworth, our audit partner for PricewaterhouseCoopers, both of whom joined us by telephone today. I now call to order this Annual General and Special Meeting of the shareholders of Ur-Energy, and I am pleased to welcome you to the meeting. At today's meeting, holders of common shares are entitled to be present and to vote. I will be acting as Chair for the meeting, and Penne Goplerud will act as Secretary. I hereby appoint with your consent, Computershare Investor Services, Inc. to serve as scrutineer for the meeting. I now table statutory declaration of Computershare Investor Services, Inc. and Broadridge, certifying the due mailing of the Notice on intent -- [indiscernible] Internet availability pursuant to applicable rules of notice and access and to those who had requested a full mailing and mailing of the notice calling the meeting, the management proxy circular and form of proxy and the annual report, including the audited consolidated financial statements of the company for the year ended December 31, 2021. I will dispense with reading the notice call for meeting. I direct that a copy of the statutory declaration confirming the mailing of the aforementioned documents and copies of those documents be kept by the secretary as part of the records of the meeting. I'm advised by the secretary that there is a quorum present. As notice has been duly provided and a quorum of shareholders is present, I declare the meeting to be regularly called and properly constituted for the transaction of business. Before we proceed to the business of the meeting, I will ask the secretary to read the customary caution with respect to forward-looking statements. So Penne.

Thank you, John. During the meeting, there may be reference to forward-looking statements for the remaining of Section 27A of Securities Act of 1933 and Section 21E of the Securities Exchange Act of 1934. The forward-looking statements contain information that is generally stated to be anticipated, expected or projected by Ur-Energy and involve known and unknown risks, uncertainties and other factors that may cause the actual results and performance of Ur-Energy to be materially different from any future results and performance expressed or implied by such forward-looking information. With regard to forward-looking statements, risk factors and projections as well as other cautionary notes to investors, we direct your attention to the legal disclaimers, which are contained in the corporate presentation to be made later in this meeting. The disclaimers apply equally through the oral presentation this afternoon and the corporate PowerPoint presentation. We ask that you read and consider carefully these disclaimers before investing or trading in our shares as well as the risk factors inherent in the forward-looking statements and projections are set forth and discussed in the corporation's annual reports on Form 10-K filed with the U.S. Securities and Exchange EDGAR system and the Canadian SEDAR system on March 9 of this year. Ur-Energy undertakes no obligation to update publicly or review any forward-looking statements, whether as a result of new information, future events or otherwise, except as may be required under applicable securities laws.

All right. Thank you, Penne. The Canada Business Corporations Act and the bylaws of the corporation entitled any shareholder present in person at the meeting to request a vote by ballot rather than a show of hands. We will be conducting the voting by ballot for those present in person at the meeting on the special matters to be voted upon today. I will ask the secretary to read the scrutineer's report on attendance and voting by proxy.

The scrutineer's report shows that there are no registered shareholders at the meeting. There are present at the meeting 102 proxyholders representing 117,979,867 common shares for a total representation in person and by proxy of 117,979,867 common shares or 53.97% of the issued common shares of the corporation.

All right. Thank you, Penne. A copy of the audited consolidated financial statements of the corporation for the year ended December 31, 2021, together with the report of the auditors thereon has been made available on the Internet, including on the Ur-Energy website pursuant to the applicable rules of notice and access and mailed to shareholders of the corporation who requested a copy of the financial statements. Our CFO, Roger Smith, is available to answer any questions on the financial statements. Are there any questions on the financial statements? All right. Hearing none. In view of the need to attend to former corporate matters, certain shareholders have volunteered to move and second resolutions where required. While this procedure will facilitate the handling of formal matters, it should not discourage any shareholder or proxy holder present from speaking on any matter before the meeting. When I recognize you, please give your name and state whether you are a shareholder or a proxy holder. The next item of business is the election of directors. I declare the meeting open for nominations for the election of directors for the ensuing year or until their successors are elected or appointed.

I nominate W. William Boberg, John W. Cash, Rob Chang, James M. Franklin, Gary C. Huber, Thomas H. Parker, and Kathy E. Walker.

As there are no further nominations, then I declare the nominations closed and it is now in order for someone to move and someone to second a resolution electing those nominated as directors of the corporation.

I move that the persons who have been nominated for election as directors are elected directors of the corporation [ for the ensuing year ] or until their successors are elected or appointed.

I now put the motion to the meeting. All those in favor of the motion, please signify in the usual manner by raising your hand. [Voting]

Any contrary. [Voting]

And it is carried. I declare those nominated to have been elected as directors of the corporation for the ensuing year or until their successors are elected or appointed. The next item of business is the appointment of auditors for the current year and authorization for the directors to fix the remuneration. It is now in order for a motion to be made appointing auditors for the current year.

I move that PricewaterhouseCoopers LLP Chartered Professional Accountants auditors of the corporation to hold office until the close of the next annual meeting of shareholders or until their successors are appointed [indiscernible] as maybe fixed by the directors and the directors are authorized to fix such [indiscernible].

May I have a second?

I second.

A motion has been made and seconded to appoint PricewaterhouseCoopers LLP as the corporation's auditors. Is there any discussion? All those in favor of the motion, please signify in the usual manner by raising your hand. [Voting]

Any contrary? [Voting]

Carried. The next item of business is the nonbinding advisory proposal on executive compensation or say-on-pay. For approval, the executive compensation proposal must receive the affirmative vote of the majority of the shares that are represented in person or by proxy at the meeting. The Board of Directors recommends that the shareholders approve this proposal. The vote on this proposal is advisory only and will be taken into consideration by the Board of Directors in establishing executive compensation in the future. Does anyone have any questions concerning this proposal? It is therefore now in order for a motion to be made on the advisory nonbinding resolution on executive compensation.

I move that the company's executive compensation [indiscernible].

May I have a second?

I second.

A motion has been made and seconded to put the advisory nonbinding vote on executive compensation to the shareholders. I now put the motion to the meeting. Voting on this resolution will be conducted by ballot. Upon registration, the scrutineer has identified those shareholders and proxy appointees who are eligible to vote on this and our special matters and has provided those individuals with a ballot. If you have not registered with the scrutineer, please do so now. Please complete the ballot marked say-on-pay by indicating a vote for or against the resolution and signing your ballot. We will collect all ballots at the conclusion of balloted voting. The next item of business for consideration at this meeting is Ur-Energy's amended and restated restricted share unit or RSU and equity incentive plan resolution to ratify confirm and approve the renewal of the plan. The plan is part of the company's overall share-based compensation plan for the employees and the Board of Directors believes that the plan is in the best interest of the company and the shareholders. A majority of the votes must be cast in favor of the amended and restated restricted share unit and equity incentive plan resolution, excluding 6,201,821 common shares held by certain insiders of the company and their affiliates. I now ask for a motion in this regard.

I move that the amended and restated restricted [indiscernible] equity [indiscernible] as set out in the management proxy circular [indiscernible].

May I have a second.

I second the motion.

The resolution has been moved. Are there any questions from the floor? I now put the motion to the meeting. Voting on this resolution will be conducted by ballot. Please complete the ballot marked amended and restricted -- restated restricted share unit and equity incentive plan resolution by indicating a vote for or against the resolution and signing your ballot. The scrutineer will now collect all of the ballots, and I would ask everyone to hand all of your ballots to the scrutineer. We will take a few moments to finalize the accounting of the balance. [Voting]

We now have the results of the voting by ballot. Penne?

With respect to the advisory vote on executive compensation or say-on-pay, the proposal has been approved by approximately 79.07% of the votes cast for the resolution. The advisory vote on executive compensation is therefore approved. With respect to the amended and restated restricted share unit and equity incentive plan solution, the proposal has been approved by a vote of approximately 60.52% of the votes cast for the resolution. The amended and restated restricted share unit and equity incentive plan resolution has been approved.

As there is no other business, I will entertain a motion to conclude the meeting.

I move the meeting [indiscernible].

May I have a second?

I second the motion.

All those in favor of the motion, please signify by raising your hand. [Voting]

All [indiscernible]. And it's carried. I now declare the formal part of the meeting concluded and we'll move on to some remarks. Give me just a few seconds to get set up here. We've got a presentation to begin. Hold the microphone so everyone can hear me, a little far to bend over to it. So -- So I wanted to start off just on a personal note and from the company's perspective, we really appreciate all of the work that Jeff Klenda has done for the company over the years and wanted to take the opportunity to acknowledge that. And I know Jeff is watching today or listening in today. And so Jeff, thank you for everything you've done over the years for the company. Many of you may not know, especially those listening in that Jeff has been with the company for over 18 years. He was there very early on nearly at the founding of the company and has been at the helm ever since. And it's -- there's been a lot of ups and downs in the uranium industry over that time. We've gone through a bit of a bear market. We've gone through a bull market, a lot of volatility, a lot of excitement that's occurred. During that time period, especially in the early to mid-2000s, there were several hundred uranium companies that were starting globally. And I think one of the things that Jeff should be very proud of and this company should be very proud of, of those many hundreds of companies that were formed at that time, only a very small handful exist to date. And at least here in the U.S., there are only 2 mines that got in production during that time period in a meaningful and commercial way and Lost Creek is one of them. And that speaks very highly of Jeff's management of the company and getting that project up and running. During that same time period, we also acquired the Pathfinder Mines Corporation, Shirley Basin and Lucky Mc mines. Jeff was integral in that. And then going back to Lost Creek, Jeff was responsible for the financing that enabled the company to keep going to permit the project, to get it designed, to get it constructed and to get it up into operation. Very, very few people in our industry can say that. So Jeff, we just want to say thank you very much for all of that. We greatly appreciate it. And on a personal note, Jeff has been a great mentor to me over the years, but especially these last few months. I've talked with him a lot, just about every day, and he's always been willing to take the call and take the time with me to explain especially on the financial end, ATMs, banking and all of those things and working through those. So Jeff, from me, from the bottom of my heart, thank you for everything you've done for the company and for me. So with that, we'd like to talk a little bit about the company and where we see things going in the future. I know our shareholders are going to be very interested in that. And we'll start off with the obligatory disclaimer. I'll change the slide there, Slide 2. And to give you guys a chance to read that, but there is a pretty strong possibility much to Penne's chagrin, that I will make some forward-looking statements. do be aware of that, and we encourage you to do your own homework. Changing slides. I'll start off with just a bit of a summary of the company. We have 2 flagship properties that you hear us talk about a lot. The first one is Lost Creek. Of course, it's been in production for quite some time now and over 8 years. And in that time, we produced greater than 2.7 million pounds of uranium. Much of that has been shipped to ConverDyn as in storage -- in storage or has been sold into contracts that we've had for a number of years. Right now, production at the mine site, we've allowed it to decline to a controlled rate in recognition that market conditions are not that great, and we don't have contracts to sell into. But I do want to be clear, we are in production. We have staff at the site, water is flowing today, and we are producing pounds. We do have the ability to ramp up the facility quite quickly. And I think that really sets us apart from a lot of our competitors here in the U.S. and globally is that ability to ramp up very quickly. To that end, in the fall of last year, we started the drilling program. And that drilling program now is getting wrapped up. We have the wells installed in the next header house, header house 2-4, and we are moving on to construction of that header house, which we expect to be completed in the third quarter. And when it comes time to ramp up, we believe we can be ramped up to that 1 million-pound a year run rate in about 6 to 8 months. So very quickly. And once we ramp up, we'll be able to continue to draw down on that great resource that we have out at Lost Creek, 11.9 million pounds of measured and indicated remaining and an additional 6.6 million pounds of inferred resource that we can go to. So we have a long life yet at Lost Creek, a very long life. Probably the other factor that we're really known for, quite famous for, really, is our low cost of production, and we're really proud of that. Our staff works very hard to keep our costs down and to work as efficiently as possible. But when we were in production, producing upwards of nearly 800,000 pounds a year. Our production costs were a little over $16 a pound. And we believe that's some of the lowest cost in the world, perhaps the lowest cost outside of Kazakhstan. We are working at expanding Lost Creek through the LC East and the KM amendments, those are in progress, and we expect to have those complete by the end of this year. And that will allow us to expand into a fairly significantly larger geographic area and address additional pounds at the site. The second flagship property that we have is Shirley Basin. We've received all 3 of the major permits we need to operate and construct there and that effectively doubles the capacity of the company because Lost Creek, its license allows 1.2 million pounds of production from the well field. And at Shirley Basin, there's an additional 1 million pounds of capacity in the license there. Beyond that, at Lost Creek, there's another 1 million pounds that we can pull process from another facility. Shirley Basin is a historic mine. There are still open pits there that have been largely reclaimed but it was also the first in situ mine or uranium that we're aware of globally. Back in 1963, they initiated really a pilot project, but it turned into a commercial project because it was so successful, and they mine well over 1 million pounds of uranium using in situ techniques, and they proved that it was amenable and that the technology would work. Since it is a brownfield property, a lot of the infrastructure is already in place and that's going to help us reduce the cost at that site. The roads are there, power lines, substation, waste disposal cell and even a couple of really nice buildings that we can utilize are in place. So when we do go to construct at Shirley Basin, we'll need to build out the well field. We'll need to do some upgrading on some of the infrastructure that's there, but also build out the back end of the plant. Our intent at this point is to take loaded resins from Shirley Basin and ship them over to Lost Creek for processing. By doing that, we don't have to build out a whole plant at Shirley Basin. We only will build out the back end. Switching to some of the business that we've had over the years in contracting. That's a very important part of the story, obviously. In 2013 to 2020, we delivered to customers about 2.4 million pounds of production from Lost Creek. In addition to that, we were able to go out into the market, and we purchased over 1 million pounds and sold into contracts as well, at a nice profit. We have substantial drummed inventory that is ready to sell, sitting at ConverDyn, that's 284,000 pounds. And at today's price, that's probably about $13.5 million, maybe pushing $14 million worth of inventory. I happened to see just a little bit ago, the price of uranium went up another dollar today. So good to see that. And changing slides. [indiscernible] can you change slides. [indiscernible]. There we go. So I'm going to switch away from the 2 flagship properties. And I'd like to talk about some of the catalysts we see going forward for our company and for the broader uranium industry in the U.S. and globally. The first one that really began, probably 2 years ago, is the world really began to recognize that if we're going to go carbon-free or carbon neutral that nuclear has got to be a part of the story. We can't just rely on renewables. They're expensive, and we put away the Sun every night, so we can't get power from it. And so we have to have good quality baseload energy and nuclear fits that bill and is carbon-free. We already get a lot of our electricity in the U.S. from nuclear power, about 20%, and that represents about 50% of our carbon-free electricity. Globally, about 10% of the world's electricity is derived from nuclear and about 1/3 of our carbon-free electricity. There's a tremendous push right now to build out the nuclear fleet globally. We already have 440 reactors in operation, 55 are in construction. There are about 100 reactors on order and about 300 reactors proposed. Now I'll be clear here that those numbers I just gave you, those are for the older style conventional large reactors, typically 1,000 megawatts or even larger. Now I'll talk about the small modular reactors here shortly, which are beginning to have an impact on the market as we go forward. The World Nuclear Association is projecting demand growth in our industry through 2040. In their base case, they're looking at 4.2% annual growth. In their upper end reference case, they're looking at 7.9% annual growth. So fantastic opportunity going forward for our commodity. But uranium is not only used just production of electricity, we're beginning to see other uses and other demands for it, specifically in hydrogen here in the U.S. and globally. A lot of people are beginning to design plants and engineer to move toward not just electric generation but also the production of hydrogen, which can be used for fuel for vehicles and for other processes. Also, the crypto miners in the electrical vehicle market, the EV market, people are beginning to understand, hey, if you're fueling these industries with fossil fuels, we're really not making progress with green energy. We've got to find an alternate supply of electricity. And so those industries are looking to nuclear for the energy that they need to run their businesses. But looking at small modular reactors, SMRs. We are beginning to see tremendous growth and the interest in those, not just talking about them, but actually engineering of them and the licensing of them and even moving into construction. In Wyoming, where our operations are based, Bill Gates, his company is moving into the western margin of the state, in a town called Kemmerer, and they are planning on replacing a coal-fired power plant with a small modular reactor within 8 years. That's a very aggressive time line, but they're going to be looking for fuel for that reactor in the near term. So not just there, but there's another reactor that's being built or being -- talked about being built in Idaho at the National Lab. Rolls-Royce is another company that's involved. New Scale is another company. Russia is involved with this, China is involved, India, you name it. There's tremendous growth potential. We don't expect it to have a dramatic impact on the market for a few years, perhaps 5 to 8 years. But as they begin to get these built out, they need to get the fuel online several years before the reactors get started. So we do expect to begin to see tremendous growth there. I heard a number from NEI just a few days ago, that potentially as many as 300 small modular reactors could be built out within the next few years as they're designed and those designs are approved by the regulators. Switching slides. Globally, the acceptance of nuclear is better than it's ever been. China is probably the gorilla in the room. They are looking at building out 150 new reactors in the next 15 years. About 6 weeks ago, they came out and said they are on track to meet that goal. And if anyone can do it, China can do it. They are very aggressive in that planning and they've got full support from their government to do that. England is also jumping in, even before Russia invaded Ukraine, their Prime Minister Johnson said that they were going to make a big bet on nuclear. After the invasion, they say they're going to double down on that big bet. And so they are looking at building a number of reactors in England. And I'll switch then to France, a bit of the same story there. I mean they already get about 70% of their electricity from nuclear. But even before the invasion, Macron was saying that they were going to extend the life of a number of their reactors, and they were looking at building out an additional 6 to 14 reactors in France. After Russia invaded Ukraine, again, they're going to double down on that and advance that aggressively. South Korea, they've elected a strong and pro-nuclear President. He is looking to continue on with their nuclear program there. They had planned to phase out their plants, is reversing that decision and intends to keep as many online as possible in Korea and also begin to export their technology. They used to be a very large exporter of nuclear utility, engineering and science, and they're going to pick that back up. But there are a number of other countries around the world that are looking at nuclear and are aggressively building out programs in those countries. And switching slides. So let's take a look at the U.S., what's going on here. I've been in the industry since 1994. I have never seen this level of support across the political aisles. Both Republicans and Democrats are really beginning to jump on the bandwagon and support nuclear power. In fact, there have been 2 bills that have been passed in the recent past. The first is the U.S. uranium reserve. It allocates $75 million to buy domestic material and hold that in a stockpile for the U.S. government to be able to DOE out in case there is a disruption of supply. Ironically, this was passed before Russia invaded Ukraine, and I think there was a little bit of foresight there. Just a few weeks ago, Secretary Granholm, from the Department of Energy, announced that, that program is being stood up. It's been a little bit slow getting stood up, but they expect that they will go out for RFPs to buy uranium this June. So we are in June now. We're expecting that at any time. They have been working with us in the background as well as other uranium mining companies in the background to get stood up with their SAMs program so that we can be a contractor or a vendor for the U.S. government, and we can respond to that RFP. So I believe that this is going to happen, hopefully, in June. But I think much sooner than later, DOE will be out looking to buy pounds. We stand ready to sell into that program. Recall, we do have the inventory, 284,000 pounds, the vast majority of which we produced at Lost Creek. The 100% of which is U.S. produced, it's all domestic, and we believe we'll be able to sell into that program. And we believe we're very unique in that regard, probably maybe only one other company in the U.S. has got U.S. produced inventory. The other legislation that has been passed is the civil nuclear credit program. Congress in a bipartisan manner, they allocated $6 billion to extend the life of the existing reactor fleet. What's important about that is, first of all, it keeps that demand online instead of it being shut down. But second, there's language within it that says there is a priority for the funding given to companies that buy domestic uranium. So again, that program is being stood up. Right now, it's an active program. The utilities are responding to the Department of Energy, and we hope that we can see some benefit from that going forward. But it is just now being stood up. There's also a lot of pending legislation, again, from both sides of the aisle. First is the Russia uranium ban, that Senate and House versions. It's bipartisan, that's being pushed forward. The no-Russia act of 2022 puts a ban on Russian imports of uranium and supports the domestic fuel cycle. That's a Barrasso bill. And then the last one on our list, which is the Manchin bill, Democrat from West Virginia is the International Nuclear Energy Act and it proposes to halt Russian imports by 2025. So we're seeing tremendous support there. And switching slides. So the next catalyst that we want to look at is the demand that was really brought on by the investment players, the financial players in the market. And looking back at the green energy, when that started to move the price upward, the financial players saw that, and they were trying to look into the future and they recognize the value of nuclear and carbon free and they said, we need to jump in early and be involved in that so we can maximize our profits. So they begin to move in. So we have hedge funds like MMCAP, Anchorage, Light Sky and Tribeca jumping in making investments. Some ETFs were formed NorthShore, Global X and also some of the big mining companies started buying pounds during COVID and when prices were depressed. They said, hey, we can't mine it this cheap, let's simply go out and buy it on the market, and that's exactly what they did. So these are some of the big guys. Cameco, Kazatomprom, Denison and a lot of the juniors went out and started buying pounds off the market. But the real game changer was in July of last year. That's when Sprott stood up their Physical Uranium Trust, effectually known as the SPUT, but they utilize an ATM function, they go out and raise money, and then they allocate those funds to the purchase of physical pounds of uranium that they put into the trust. Since July 19 of last year, they've grown that inventory to in excess of 55 million pounds of uranium. That's a tremendous pressure, especially on the spot market. And we believe that those mobile inventories that are available in the spot market are really beginning to dry up. And as Sprott jumps back in, we believe they're going to put a lot more pressure on that going forward. After Sprott put together that Physical Uranium Trust, Kazakhstan jumped in the game as well. They developed their own uranium fund and they have said they'll be dedicating $500 million to that fund. So changing slides. Moving to the third catalyst, Geopolitical risk. And I don't need to talk a whole lot about this because everyone is familiar with what's going on with Russia and Ukraine. But we have to appreciate that Russia is a major supplier of nuclear fuel not just to the U.S. but globally. In the U.S., they fill about 20% of our demand. Globally, it's about 43% of enrichment capacity and 38% of conversion capacity is based in Russia. And I've seen all kinds of numbers on that, but I believe that those are probably pretty realistic numbers as far as their supply capacity in Russia. Kazakhstan is an important part of the story as well because they supply 46% of primary supply or mine material, and they are one of our direct competitors. But they're heavily influenced by Russia. And it's very easy to envision a number of scenarios where that supply out of Kazakhstan could get cut off because of direct or indirect sanctions. We're already seeing that the logistics of shipping material out of Kazakhstan are becoming very difficult and is delaying material shipments out of the country. They are currently looking for alternate ways besides going through Russia because Russia has become a very difficult trade route. Going up through Saint Petersburg and into the Baltic Sea. Part of that is because no one wants to ship anything out of Russia. They don't want to be subject to direct or indirect sanctions. And insurance is a problem as well. Nobody wants to play in that part of the world. And so it's becoming very challenging. So the question we have to ask is, if that supply gets shut down from Russia and/or if it gets shut down out of Kazakhstan, where is the replacement. And quite frankly, there's not a good answer to that. If you take a look at some of the historic producers globally, take a look at Canada, for example, Cameco is one of the major players in the market. They've got 2 great mines up there, but they've got a limited capacity to ramp up. In the case of Cigar Lake, a limited lifetime. And so there's a limited ability to backfill from Canada. Yes, there are some other good deposits that could be brought online out of Canada to help backfill that supply gap. But the fact is there are probably many, many years out before they can be brought online. If you take a look at Australia, the story is pretty similar there to Canada. Yes, they've got a couple of mines up and running, good mines, good producers, but they have a limited ability to ramp up. There are -- there is some opportunity to bring some additional mines on there, but they're going to be relatively small compared to that supply coming out of Russia and Kazakhstan. So limited ability there. Then if you switch gears one more time to Africa and you say, okay, Africa, they used to be a big supplier and they still are. They still produce a lot of pounds in Africa. But you have to keep in mind that 2 of those mines are directly owned by China. A third mine, which is a large mine, China controls the debt on that. So they have a lot to say what happens there. And the other mines are owned by France, the [indiscernible]. So if there's a pinch, where are those pounds going to go? Well, those 3 mines that have -- are largely controlled by China, those pounds are going to go to China. They're not going to come to the U.S. And I suspect France will want to claim their own pounds if the market gets tight. So we think there's a limited ability to get pounds out of Africa. The next slide. So we'll switch gears to the U.S., what's the capacity here in the U.S. to backfill a supply gap, not great right now. If you take a look at the chart produced by the EIA, it shows that uranium production in the U.S. has declined over the last many years. And effectively, today, it's 0. A very minimal production here. Most of the uranium we're burning in the U.S. is coming from foreign sources, nearly 100%. Changing slides. But that's where we come in. That's where Ur-Energy comes in because we've got a producing mine. We've got Lost Creek, again, with a great resource in the ground, proven production, not hypothetical production, not something we need to build out. It's there and it exists. We've got a lot of manpower there and the ability to ramp it up. My statements are backed up by 8 years of production, where we've had an average recovery rate of 90%. In our industry, typically, if you get 60% to 80% recovery, that's pretty good. You're pretty happy with that. At loss Creek, we've had 90% of recovery. We also had a great exploration area around the known resource. Every time we've gone out and had an exploration program we've done drilling, we've been able to expand the resource. And we believe that we can go out do that again on the 35,000 acres that we have there in the immediate area of Lost Creek. Changing slides. So taking a look back historically at our production rates, and taking a look at our cost of production, I'd like to call everyone's attention to the year 2015 because that's when we had nearly 800,000 pounds of production. And if you follow the column down to the bottom, you'll see that our cash cost in mine site cash cost was $16.27 a pound. That's fantastic. And we believe, again, that, that's some of the best in the world. And you can see that projection from 2014 through 2019, real production, real pounds that we're getting out of the ground and producing at a very, very low cost. We believe we can return to very nearly those cost again when we ramp back up. Changing slides. Pathfinder, the Shirley Basin project. We also believe that we have an opportunity to get some very low-cost production there as well from the 8.8 million pounds of measured and indicated resources that are there. So the most recent economic analysis we did, we've estimated that production cost there will be actually less than at Lost Creek at about $15.86 a pound. And that's because the ore body is shallow. It is well drilled. It's all in the measured and indicated, so we don't have to go out and do exploration and delineation drilling. We've got all of the historic records. So when we go out there, we can go straight away right into the installation of wells or production. Land holding costs out there are minimal as well because we own much of the land. We have 3 of the major permits we need to begin construction there. And we can do that very quickly, get it built out, get it ramped up to 1 million pound a year run rate in about 15 to 18 months. Switching slides. I already called out the development program that's ongoing at Lost Creek. Again, the objective there is to be able to ramp up production as quickly as we possibly can. And that program is coming to its end. That will allow us to turn on header house 2-4 very quickly when the time comes for it. We're also continuing to drill and do delineation drilling and additional header houses to be able to expedite production there going forward. And everyone is aware of shortages of materials, and we're very keenly aware of that. Not a surprise to us. Our VP of Operations, Steve Hatten, he can talk to you all day about some of the challenges there. But some time ago, we implemented a program where we keep track of each of the parts we need. We keep track of the cost and the time it's going to take to get those materials in. And any time that lead time gets out too far, and it looks like it could impede our ability to ramp up within 6 to 8 months, we go ahead and get it ordered, get it on the ground. So we believe we're ahead of the game there. and that, that supply disruptions will not interrupt or disrupt our ability to ramp up production. We've also been able to keep our key staff out of the site. Most of our guys have been in the industry for many, many years, a lot of them several decades. They know how to make pounds. They've made pounds at Lost Creek. They've made pounds at other in situ mines across the U.S. And so we know how to construct, we know how to operate. We're also looking at optimizing our facility to further drive down our costs, and I'll speak a little bit more to that shortly. Now switching slides. ESG is becoming more and more prevalent in discussions with publicly traded companies. And as far as the environmental aspect of that and having green operations, we really believe we are leading the industry and leading the ESG movement, especially with regard to CO2. One of the statistics that I'd like to put out there that's just mind boggling is if you take a look at the resource in the ground at Lost Creek and at Shirley Basin and you produce that to make electricity and you compare the CO2 emissions from that versus the same energy generation from coal-fired it will offset more than 312 million metric tons of CO2 compared to coal power. That's equivalent to taking 67 million cars off the road for a year. That's incredible. And something that we should be proud of, and we'll be talking more about in the future. So we're taking other steps to reduce our footprint. In December, we purchased a plot of land and office in cash, for Wyoming, and we're going to be building out a shop there so that we can do -- have a chemistry lab and construction in town. And that will hopefully minimize the need for many of our employees to drive out to the mine site every day. Our mine site is remote, and we'd like to be able to reduce the emissions related to driving out as well as improve the safety and the quality of life for our employees. So that's ongoing, and we'll be talking about that more as the year goes on. As far as mining technique, we don't use the conventional technique. Ur-Energy is an in situ minor, which is now the prevalent method for uranium recovery globally. The great thing about it is it's not energy-intensive. And when we're done, we pull up stakes, we clean up and we leave where we've been and it can be used for anything. It's free release and you won't even be able to tell we're there. So the surface impact is absolutely minimal. One other thing we've been working on is to reduce our amount of wastewater that we generate. And we've made great strides on that in the past, and we're going to continue to work on that. Our goal is to get up to a recycle rate of 99.8% of our water. To do that, innovation is going to be key. And we are well known for our innovation. There are a number of things that we've done over the years that really proved that our staff and we know what we're doing, and we can bring new and exciting ideas to the industry. Some of those ideas are the ion exchange vessel design that's been working great for us. We've instituted a Class V water treatment disposal system that's helped reduce our wastewater generation. We are currently -- I'm sorry, historically, we developed a new well abandonment method for our industry, and that's used across the industry now. And we've also developed an aquifer exemption technology and some calculations associated with that are now used across the industry as well. Going forward, there are 2 projects that we're working on right now that we've disclosed. We're working on some others. But the 2 that we've talked about, the first is a well casing and installation methodology that's ongoing. We've gotten a patent for that. And we worked our way through the permitting process and actually got our permits, and we're ready to go out and do installation on that. So we'll be testing that in the coming weeks. But if we can prove that out, we believe we can reduce our drill time related to injection wells by 70%. That's real money that will have an impact on the bottom line. At the same time, it will reduce our footprint in the field because there will be less noise, less fuel consumption, less activity out there. The second R&D project is an advanced water treatment filtration system. Again, the goal here is to reduce the amount of water -- wastewater that we generate. That's ongoing. We expect to have some finality on that on the engineering design late this year. And the goal is to reduce the number of deep disposal wells because we have less wastewater that we're generating. Switching slides. When companies do presentations, and I go into a lot of investor relations conferences and meetings, and I hear a lot of other companies talk about their management and everyone brags that we've got the most senior management, they're the best. They really know what they're doing. They're innovative, low-cost producers, sounds a lot like what I've said today. But I really like to bring up this chart because I think it really puts this into perspective, and it's about dilution. In our company, when Jeff was running the company and as I take the reins and move forward, dilution is a dirty word. Jeff is a big shareholder, me not so much, but I've got a lot of shares and dilution is a dirty word. I don't want my shares diluted. And so we've run a very tight ship over the years. And you can see that our dilution compared to our competitors is minuscule. And that's because we run a tight ship. It's because we've got a quality ore body that we've been working on. Our staff, they know what they're doing. And we've been able to produce pounds, meaningful pounds, sell those into contracts to offset our costs. So we're not out in the market raising money all the time. And we're going to continue to operate the same way. Changing slides. Now taking a look at our market position. Market cap has been quite volatile lately. And this slide is a day old, and it's already out of date because today has been a big mover on the market. So I suspect we're beginning to push upwards of $300 million on our market cap to date. And we've got a great cash position. And at the 28th of last month, we had a little bit over $45 million of cash at our disposal to be able to use. And we're hoping to be able to use that money to ramp up Lost Creek and ultimately, Shirley Basin. Beyond that, recall, we've got the inventory that we can sell and bring in another hopefully, about $14 million. So we'll see where the price goes. But we're well cashed up. We're in a good, strong position going forward. We've got great analyst coverage, both in Canada and in the U.S. We've got 5 different companies covering us of Alliance Global Partners, B. Riley, H.C. Wainwright, ROTH and Cantor are all covering us. So great coverage. So in conclusion, a few takeaways, a number of catalysts out there that we want to keep an eye on going forward. But when you look at Ur-Energy, keep in mind that we are well cashed, we're well ready to ramp up our Lost Creek mine. We've got that good strong cash position of over $45 million, 284,000 pounds of inventory to sell, and we are a proven producer. We've put pounds in the can, and we know that we can ramp up and do it again. We've got the staff on hand. We've got the wells installed to be able to begin that ramp-up process, and we'll be keeping an eye on those catalysts that we talked about going forward that will enable us to sign contracts and help us to ramp up. So our new model that we've been using is Ur-Energy, we have the solution. So Steve, there's our new model. We have the solution. With that, I'll pause there. And if there are any shareholders that have any questions, we'd be glad to entertain any questions.

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What we'd like to see is north of $100 a pound. I get asked that all the time. Yes, I get asked that all the time. And we're careful not to tell the exact number. We are working with utilities right now, working towards contracting as we've got those prices worked out, where we want to be. Just a couple of comments I would make short of giving you an exact answer is, number one, we're not going to give away the pounds. We've been in a long downturn. We've got a lot of long-suffering shareholders, and we want to reward those shareholders. And we're a low-cost producer. And we can probably sell lower -- at a lower price than anybody in the U.S. and have a higher profit margin. But we want to take advantage of that. So I'll say that -- and then the other comments that I commonly make is when we were signing contracts back in 2012, '13, '14, in that era, we were signing contracts on the order of $50 a pound. So if you want to kind of get in the ballpark of where we want to be, take those numbers and multiply them buy inflation, and you're going to start to get into the ballpark of where we want to be with contracting going forward. Hopefully, that gives you a little bit of light on that without directly answering the question. Any other questions that I can answer? We got a lot of people in the audience that have been with Ur-Energy for a long time. So they already know the answers to the questions. Okay. With that, I'll conclude my remarks, and thank you, everybody, both listening in on the line and also here in person for attending. We really appreciate you being here. We appreciate your continued support and just keep watching the press releases. Hopefully, we'll have some good news here in the coming weeks as those catalysts come to fruition. So thank you, everyone.

Thank you. Ladies and gentlemen, this does conclude today's call. You may disconnect your lines at this time, and have a wonderful day. Thank you for your participation.