Ur-Energy (URE-T) Cost-Saving Measures
Aug 6, '19 - NR
Ur-Energy announces it has implemented an additional reduction in force, primarily affecting employees at its Lost Creek facility
On July 12, 2019, the President responded to our Section 232 Trade Action with a Memorandum establishing the United States Nuclear Fuel Working Group (the "Working Group") to develop recommendations for reviving and expanding domestic uranium production. The Memorandum did not, however, offer any current relief in response to the Trade Action, such as the domestic quotas suggested by our Petition. As a result of the White House decision to not take action at this time, we were compelled to respond and initiate significant cost-saving measures which, unfortunately, included a reduction in force affecting ten of our Wyoming employees. Other, additional, measures will be taken to streamline our expenditures even further while we await the outcome of the Working Group's efforts and pursue other avenues of relief.
Ur-Energy Chairman and CEO, Jeff Klenda, said, "We are determined to succeed in our work alongside the Trump Administration and with our customers to find solutions to correct this dysfunctional uranium market, and we remain optimistic that a positive outcome will be reached through these efforts. We must, however, at the same time take aggressive proactive measures to further control costs. We are taking these measures to maximize the amount of time, or 'runway,' available to the Company to avoid dilution of our shareholders or other needs for financing. During this time, we will avail ourselves of any and all remedies to ensure the continued viability of our Company. Sadly, these measures include the difficult decision to lay off ten of our Wyoming staff."
Several remaining employees have been asked to change job responsibilities and/or carry additional duties. The affected employees have been offered severance arrangements in order to assist with their transition to other employment opportunities. Implementation of the adjustments necessitated by the reorganization has begun and will be complete in coming weeks. The nominal operational modifications required at Lost Creek will be overseen closely to assure continued safe and compliant operations. Together with other measures slated to be implemented, including lower production rates and no development activities, these measures represent an expected annual savings of approximately $4 million, beginning in 2020.
We provided further guidance for 2019 in our Form 10-Q and Earnings Release, August 2, 2019, confirming that production estimates for Lost Creek have been lowered to between 50,000 and 75,000 pounds U3O8 during 2019. We can no longer justify the added cost of maintaining full operational readiness as it relates to labor, and have accordingly reduced staffing to the minimum levels necessary to maintain operations. We have retained core operational personnel who possess the critical knowledge necessary for the Company to ramp up when conditions warrant. This enables the Company to preserve our ability to react swiftly and efficiently to changing market conditions when incentivized, while simultaneously minimizing the need for additional funding during this continuing period of uncertainty.
About Ur-Energy
Ur-Energy is a uranium mining company operating the Lost Creek in-situ recovery uranium facility in south-central Wyoming. We have produced, packaged and shipped approximately 2.5 million pounds from Lost Creek since the commencement of operations. Applications are under review by various agencies to incorporate our LC East project area into the Lost Creek permits, and to construct and operate at our Shirley Basin Project. Ur-Energy is engaged in uranium mining, recovery and processing activities, including the acquisition, exploration, development and operation of uranium mineral properties in the United States. Shares of Ur-Energy trade on NYSE American under the symbol "URG" and on the Toronto Stock Exchange under the symbol "URE." Ur-Energy's corporate office is in Littleton, Colorado; its registered office is in Ottawa, Ontario. Ur-Energy's website is www.ur-energy.com.
FOR FURTHER INFORMATION, PLEASE CONTACT
Jeffrey Klenda, Chair and CEO
+1 720.981.4588
Jeff.Klenda@Ur-Energy.com |
