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Uranium One

South Inkai Mine

South Inkai is an operating in situ recovery uranium mine located in the Chu-Sarysu basin in the Suzak region, South Kazakhstan province, approximately 250 km northwest of Shymkent, Kazakhstan.  The mine is owned by the Betpak Dala joint venture, a Kazakh registered limited liability partnership in which Uranium One has a 70% interest. The other 30% interest in Betpak Dala is owned by JSC NAC Kazatomprom, Kazakhstan’s state-owned company responsible for the mining and exporting of uranium.

Production

Commercial production at the South Inkai mine commenced on January 1, 2009, following a 15 month pilot plant program conducted during the period from October 2007 to December 2008.

Pursuant to the terms of its subsoil use contract, the current production capacity of the South Inkai mine is 5,200,000 lbs U3O8 (2,000 t U) per year.  It is expected that the annualized rate of production will reach this level in 2012.

Uranium is extracted at the South Inkai mine using the in situ recovery method, and processed using ion exchange technology at a processing facility on site.

Most recently, in 2013, the South Inkai mine produced 5,277,600 lbs U3O8 (2,030 t U), of which 3,694,300 lbs U3O8 (1,421 t U) was attributable to Uranium One.

Mineral Resources and Mineral Reserves

The following table sets out the mineral resource and mineral reserve estimates for the South Inkai mine as of December 31, 2013.


SOUTH INKAI MINE

(as at December 31, 2013)

Ore

(000s tonnes)

Grade

(% U)

Tonnes U

Grade (%U3O8)

Uranium

(M lbs U3O8)

Reserves

100%

100%

70%

100%

70%

Proven

81,372

0.012

9,733

6,813

0.014

25,303

17,712

Probable

55,272

0.018

9,686

6,780

0.021

25,182

17,627

Proven and Probable

136,644

0.014

19,419

13,593

0.017

50,485

35,340

Resources




Measured

42,925

0.025

10,814

7,570

0.030

28,114

19,680

Indicated

46,116

0.041

19,059

13,341

0.049

49,549

34,684

Measured and Indicated

89,041

0.034

29,872

20,911

0.040

77,663

54,364

Inferred

69,604

0.039

26,967

18,877

0.046

70,108

49,076

Notes:

(1)   Mineral Resources that are not Mineral Reserves do not have demonstrated economic viability.  Inferred Mineral Resources have a great amount of uncertainty as to their existence and as to their economic feasibility.  Under no circumstances can it be assumed that all or any part of an Inferred Mineral Resource will ever be upgraded to a higher Mineral Resource category or converted to Mineral Reserves.

(2)   The foregoing Mineral Resource and Mineral Reserve estimates are taken from Uranium One’s Summary of Mineral Resources and Mineral Reserves at June 30th 2013 outlined in "Uranium One Announces a 5% Increase in Q3 2013 Production to 3.2 Million Pounds at an Average Total Cash Cost of $16 per Pound Sold" on November 4, 2013, and are subject to the methods, parameters, assumptions, qualifications and procedures which are set out in such document. For a complete description of such methods, parameters, assumptions, qualifications and procedures, reference should be made to the full text of the foregoing document, which is available for review on SEDAR under Uranium One’s profile located at the following website:www.sedar.com.  Mineral Resources and Mineral Reserves are reported in accordance with Definition Standards on Mineral Resources and Mineral Reserves adopted by the Council of the Canadian Institute of Mining, Metallurgy and Petroleum and National Instrument 43-101 –Standards of Disclosure for Mineral Projects promulgated by the Canadian Securities Administrators.

(3)   The second column for “Tonnes U” and “U3O8” represents the portion of total Mineral Reserves and/or Mineral Resources notionally attributable to Uranium One’s equity interest in the joint venture through which the property is owned in the percentage indicated in this column.