How AAA Might Fund Construction
One of my other holdings just did an interesting deal to fund uranium mining construction, without dilution to shareholders:
Ur-Energy Raises Funds for Ongoing Lost Creek Construction
Littleton, Colorado (PR Newswire – March 25, 2013) Ur-Energy Inc. (TSX:URE, NYSE MKT:URG) (“Ur-Energy” or the “Company”) is pleased to announce the closing of a uranium sales transaction that provides an immediate payment to the Company of approximately US$5.1 million. Proceeds from the transaction will support the ongoing construction at the Company’s flagship Lost Creek Project.
Ur-Energy, with the cooperation of one its utility customers, assigned a portion of its contractual delivery obligations to Traxys, a large uranium and natural resource trading company, in exchange for a current cash payment. Ur-Energy has retained additional future delivery obligations under this and other previously announced uranium sales agreements.
Ur-Energy President and CEO Wayne Heili commented, “The Company is pleased to have the assistance and support of our counter-parties in this transaction. The transaction, which might best be understood as a sale of contractual future product deliveries, has allowed the Company to raise funds without dilution to our shareholder’s interests or repayment obligations. The cash infusion will help Ur-Energy in maintaining a steady construction pace at Lost Creek while we await the finalization of the Wyoming Industrial Revenue Bond approval process.”
The construction efforts at the fully licensed Lost Creek project are continuing on-schedule for initial production this year. Electrical and pipe-fitting work has been initiated within the plant building. Construction of an auxiliary shop building is also underway. Two disposal wells have been installed and developed. The construction of the first mine unit also remains on schedule while the pipeline between the plant and mine unit facilities is being installed. Updated photographs of the progress of construction at Lost Creek are available at our website: www.ur-energy.com.
