Business Overview


The following discussion is designed to provide information that we believe is
necessary for an understanding of our financial condition, changes in financial
condition, and results of our operations. The following discussion and analysis
should be read in conjunction with the MD&A contained in our Annual Report on
Form 10-K for the year ended December 31, 2020.



Incorporated on March 22, 2004, Ur-Energy is an exploration stage mining
company, as that term is defined by the SEC. We are engaged in uranium mining,
recovery and processing activities, including the acquisition, exploration,
development and operation of uranium mineral properties in the U.S. We are
operating our first in situ recovery uranium mine at our Lost Creek Project in
Wyoming. Ur-Energy is a corporation continued under the Canada Business
Corporations Act on August 8, 2006. Our Common Shares are listed on the TSX
under the symbol "URE" and on the NYSE American under the symbol "URG."



Ur-Energy has one wholly owned subsidiary, Ur-Energy USA Inc., incorporated
under the laws of the State of Colorado. Ur-Energy USA Inc. has three
wholly-owned subsidiaries: NFU Wyoming, LLC, a limited liability company formed
under the laws of the State of Wyoming which acts as our land holding and
exploration entity; Lost Creek ISR, LLC, a limited liability company formed
under the laws of the State of Wyoming to operate our Lost Creek Project and
hold our Lost Creek properties and assets; and Pathfinder Mines Corporation
("Pathfinder"), incorporated under the laws of the State of Delaware, which
holds, among other assets, the Shirley Basin and Lucky Mc properties in Wyoming.
Our material U.S. subsidiaries remain unchanged since the filing of our Annual
Report on Form 10-K, dated February 26, 2021.



We utilize in situ recovery ("ISR") of the uranium at our flagship project, Lost
Creek, and will do so at other projects where possible. The ISR technique is
employed in uranium extraction because it allows for an effective recovery of
roll front uranium mineralization at a lower cost. At Lost Creek, we extract and
process uranium oxide ("U3O8") for shipping to a third-party conversion facility
to be weighed, assayed and stored until sold.



Our Lost Creek processing facility, which includes all circuits for the
production, drying and packaging of U3O8 for delivery into sales transactions,
is designed and anticipated under current licensing to process up to 1.2 million
pounds of U3O8 annually from the Lost Creek mine. The processing facility has
the physical design capacity and is licensed to process 2.2 million pounds of
U3O8 annually, which provides additional capacity, of up to one million pounds
U3O8, to process material from other sources. We expect that the Lost Creek
processing facility may be utilized to process captured U3O8 from our Shirley
Basin Project. However, the Shirley Basin permit and license allow for the
construction of a full processing facility, providing greater construction and
operating flexibility as may be dictated by market conditions.



COVID-19



During the quarter, we continued to monitor updated State, Federal and public
health guidance related to COVID-19 and have adapted to continuing changes in
the guidance and restrictions. We have experienced no cases of COVID-19 among
our staff which have had a material impact on our operations.




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Uranium Market Update



With global climate initiatives being advanced by numerous countries, there has
been a great deal of support for nuclear energy in the news during Q3 and
subsequent to quarter-end. Growing numbers of countries are making commitments
to net-zero emissions, including on more accelerated schedules than previously
announced. In the process, many nations are endorsing nuclear energy to meet
such objectives. This support, and projections for sustained growth of nuclear
power globally in coming years, has incentivized much investment in the fuel
cycle industries, through legislative programs and private and industrial
capital. These and other market influences have been accompanied by significant
developments among purchasers of uranium. In addition to the financial firms,
ETFs and uranium producers and developers who have purchased substantial uranium
inventories in 2021, the newly formed Sprott Physical Uranium Trust began making
significant purchases of uranium during Q3, as well as establishing the means in
the equity markets to raise more than $1 billion for such purchases. Subsequent
to quarter-end, the most recent participant in the long-term investment in
uranium is the physical uranium fund formed by the Kazakhs, including
Kazatomprom, the national uranium operator of Kazakhstan.



The U.S. Department of Energy ("DOE") continues its work to implement the new
national uranium reserve which was established in December 2020. DOE published
requests for information for stakeholders to respond with data and input to
support and define the establishment of the uranium reserve. Following an
extension, all such responses were due to DOE in mid-October. DOE has not yet
publicly provided a timeline of the remaining process to launch the reserve.



In addition to the DOE uranium reserve, the Biden Administration continues to
prioritize climate change initiatives and, like many other governments, has
expressed an understanding that clean, carbon-free nuclear energy must be an
integral part of those initiatives. Several pieces of federal legislation have
been proposed which would support nuclear energy and the nuclear fuel cycle

industries.



Mineral Rights and Properties



We have 12 U.S. uranium properties. Ten of our uranium properties are located in
the Great Divide Basin, Wyoming, including Lost Creek. Currently, we control
nearly 1,800 unpatented mining claims and three State of Wyoming mineral leases
for a total of approximately 36,000 acres in the area of the Lost Creek
Property, including the Lost Creek permit area (the "Lost Creek Project" or
"Project"), and certain adjoining properties referred to as LC East, LC West, LC
North, LC South and EN Project areas (collectively, with the Lost Creek Project,
the "Lost Creek Property"). Our Shirley Basin Project, also in Wyoming,
comprises more than 3,700 Company-controlled acres. Our Lucky Mc Project holds
1,800 acres in the Gas Hills Mine District, Wyoming. As set forth elsewhere in
this report, we received final approvals of reclamation at the Lucky Mc project
in Q3 and confirmation of the termination of the permit to mine and associated
bond requirements. Our Excel gold project holds approximately 2,400 acres of
mining claims in the Excelsior Mountains of Mineral County, Nevada.



Lost Creek Property



Lost Creek continues to operate at reduced production levels while we await
additional positive developments in the uranium markets. The reduced production
operations have allowed us to sustain operating cost reductions at Lost Creek,
while continuing to conduct preventative maintenance and optimize processes in
preparation for ramp up to full production rates.



Previously, we disclosed that such preparations included advanced planning for
further development of our fully permitted Mine Unit 2 ("MU2"). Subsequent to
quarter-end, we commenced a drilling and construction program for the
development of the fourth header house in MU2 (HH2-4). HH 2-4, and its
associated drilling and wellfield development, is expected to be complete early
in 2022, at which time HH 2-4 will be ready for production. A delineation drill
program to support geologic design in the following four header houses is
planned for 2022 H1. Together, the two programs will significantly advance our
readiness when production ramp-up occurs.




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Applications for amendment to the Lost Creek licenses and permits were submitted
in 2014 in order to include recovery from the uranium resource in the LC East
Project (HJ and KM horizons) immediately adjacent to the Lost Creek Project. In
2021 Q1, the Wyoming Uranium Recovery Program ("URP") approved the amendment to
the Lost Creek source material license to include recovery from these areas.
This license approval grants the Company access to six planned mine units in
addition to the already licensed three mine units at Lost Creek. The approval
also increases the license limit for annual plant production to 2.2 million
pounds U3O8 which includes wellfield production of up to 1.2 million pounds U3O8
and toll processing up to one million pounds U3O8. The BLM previously completed
its review and granted approval for this expansion at Lost Creek.



The Wyoming Department of Environmental Quality, Land Quality Division,
continues its review of the application for amendment to the Lost Creek permit
to mine which will add the LC East and KM mine units. We anticipate that the
Land Quality Division review will be complete in 2021.



Shirley Basin Project
During 2021 Q2 the State of Wyoming and the EPA completed their respective
reviews of our Shirley Basin Project and issued the source material license,
permit to mine, and aquifer exemption for the project. These three approvals
represent the final major permits required to begin construction of the Shirley
Basin Project. We received BLM final approval of the project, following its

NEPA
review process, in 2020.



The Company plans three relatively shallow mining units at the project, where we
have the option to build out a complete processing plant with drying facilities
or a satellite plant with the ability to send loaded ion exchange resin to Lost
Creek for processing. As approved, the Shirley Basin processing facility is
allowed to recover up to one million pounds U3O8 annually from the wellfield.
The annual production of U3O8 from wellfield production and toll processing of
loaded resin or yellowcake slurry will not exceed two million pounds equivalent
of dried U3O8 product.



Situated in an historic mining district, the project has existing access roads,
power, waste disposal facility and shop buildings onsite. Because delineation
and exploration drilling were completed historically, the project is
construction ready. All wellfield, pipeline and header house layouts are
finalized and additional, minor on-the-ground preparations were initiated in
2021 Q3. We anticipate up to nine years of production at the site.



Results of Operations


The following table provides information on our production and ending inventory of U3O8 pounds.

Reconciliation of Non-GAAP measures with US GAAP financial statement presentation


The U3O8 and cost per pound measures included in the following table do not have
a standardized meaning within US GAAP or a defined basis of calculation. These
measures are used by management to assess business performance and determine
production and pricing strategies. They may also be used by certain investors to
evaluate performance.




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U3O8 Production and Ending Inventory





                      Unit       2020 Q4       2021 Q1       2021 Q2       2021 Q3        2021-09 YTD

U3O8 Production

Pounds captured       lb               54            49            58            70                177
Pounds drummed        lb            6,622             -             -             -                  -
Pounds shipped        lb                -        15,873             -             -             15,873
Pounds purchased      lb                -             -             -             -                  -

U3O8 Ending
Inventory

Pounds
In-process            lb
inventory                             303           318           365           999
Plant inventory       lb           15,873             -             -             -
Conversion
inventory -           lb
produced                          219,735       235,608       267,617       267,049
Conversion
inventory -           lb
purchased                          48,750        48,750        16,741        16,741
                      lb          284,661       284,676       284,723       284,789

Value
In-process
inventory           $   000     $       -     $       -     $       -     $       -
Plant inventory     $   000     $     463     $       -     $       -     $       -
Conversion
inventory -
produced            $   000     $   6,083     $   6,592     $   7,487     $   7,486
Conversion
inventory -
purchased           $   000     $   1,268     $   1,268     $     435     $     435
                    $   000     $   7,814     $   7,860     $   7,922     $   7,921

Cost per Pound
In-process           $/lb
inventory                       $       -     $       -     $       -     $       -
Plant inventory      $/lb       $   29.17     $       -     $       -     $       -
Conversion
inventory -          $/lb
produced                        $   27.68     $   27.98     $   27.98     $   28.03
Conversion
inventory -          $/lb
purchased                       $   26.01     $   26.01     $   25.98     $   25.98
                     $/lb       $   27.45     $   27.61     $   27.82     $   27.81

Produced
conversion
inventory detail:
Ad valorem and       $/lb
severance tax                   $    0.75     $    0.67     $    0.59     $    0.59
Cash cost            $/lb       $   17.50     $   17.28     $   18.56     $   18.59
Non-cash cost        $/lb       $    9.43     $   10.03     $    8.83     $    8.85
                     $/lb       $   27.68     $   27.98     $   27.98     $   28.03




During 2020, we took steps to reduce production operations at Lost Creek and
adjust to the continued depressed state of the uranium markets while we awaited
the recommended relief from the Working Group and further positive developments
in the uranium markets. As a result, production rates at Lost Creek declined
significantly since that decision was made. Pounds captured decreased nearly 80
percent during that year and will remain low until a decision to ramp up is
made.



As of September 30, we had approximately 283,790 pounds of U3O8 at the
conversion facility including 267,049 produced pounds at an average cost per
pound of $28.03, and 16,741 purchased pounds at an average cost of $25.98 per
pound. In April 2021, we exchanged purchased U3O8 in our inventory for an equal
number of pounds of U3O8 with a trader who held Lost Creek origin pounds
pursuant to an earlier agreement.




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Three and nine months ended September 30, 2021, compared to the three and nine months ended September 30, 2020

The following table summarizes the results of operations for the three months ended September 30, 2021, and 2020:





(expressed in thousands of U.S. dollars, except
per share and pound data)

                                                               Three months ended
                                                                 September 30,
                                                       2021          2020         Change

Sales                                                        9             -             9
Cost of sales                                           (1,703 )      (1,840 )         137
Gross profit (loss)                                     (1,694 )      (1,840 )         146

Operating costs                                         (2,585 )      (2,157 )        (428 )
Loss from operations                                    (4,279 )      (3,997 )        (282 )

Net interest expense                                      (182 )        (195 )          13
Warrant mark to market gain                             (5,060 )         550        (5,610 )
Foreign exchange gain (loss)                                15           (53 )          68
Other income (expense)                                       3            (1 )           4
Net loss                                                (9,503 )      (3,696 )      (5,807 )

Foreign currency translation adjustment                    219            36           183
Comprehensive loss                                      (9,284 )      (3,660 )      (5,624 )

Loss per common share:
Basic                                                    (0.05 )       (0.02 )       (0.03 )
Diluted                                                  (0.05 )       (0.02 )       (0.03 )

U3O8 pounds sold                                             -             -             -

U3O8 price per pounds sold                                   -             -             -

U3O8 cost per pounds sold                                    -             -             -

U3O8 gross profit per pounds sold                            -            

-             -





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The following table summarizes the results of operations for the nine months ended September 30, 2021, and 2020:





(expressed in thousands of U.S. dollars, except
per share and pound data)

                                                              Nine months ended
                                                                September 30,
                                                      2021          2020          Change

Sales                                                      16         8,304         (8,288 )
Cost of sales                                          (5,211 )     (11,462 )        6,251
Gross profit (loss)                                    (5,195 )      (3,158 )       (2,037 )

Operating costs                                        (7,174 )      (6,446 )         (728 )
Loss from operations                                  (12,369 )      (9,604 )       (2,765 )

Net interest expense                                     (558 )        (522 )          (36 )
Warrant mark to market gain                           (11,384 )         592        (11,976 )
Foreign exchange gain (loss)                             (352 )         (46 )         (306 )
Other income (expense)                                    909            16            893
Net loss                                              (23,754 )      (9,564 )      (14,190 )

Foreign currency translation adjustment                   472            67

           405
Comprehensive loss                                    (23,282 )      (9,497 )      (13,785 )

Loss per common share:
Basic                                                   (0.13 )       (0.06 )        (0.07 )
Diluted                                                 (0.13 )       (0.06 )        (0.07 )

U3O8 pounds sold                                            -       200,000       (200,000 )

U3O8 price per pounds sold                                  -         41.50         (41.50 )

U3O8 cost per pounds sold                                   -         25.83         (25.83 )

U3O8 gross profit per pounds sold                           -         15.67

        (15.67 )




Sales



There were no sales of U3O8 in the first nine months of 2021, and we do not
anticipate making any U3O8 sales in 2021. We sold 200,000 pounds of U3O8 during
the nine months ended September 30, 2020, for an average price of $41.50 per
pound. There were no sales in 2020 Q3. The sales were all into term contracts
using purchased pounds.



Cost of Sales



Cost of sales per the financial statements includes ad valorem and severance
taxes related to the extraction of uranium, all costs of wellfield and plant
operations including the related depreciation and amortization of capitalized
assets, reclamation, and mineral property costs, plus product distribution
costs. These costs are also used to value inventory. The resulting inventoried
cost per pound is compared to the NRV of the product, which is based on the
estimated sales price of the product, net of any necessary costs to finish the
product. Any inventory value in excess of the NRV is charged to cost of sales
per the financial statements. These NRV adjustments are excluded from the U3O8
cost of sales and U3O8 cost per pound sold figures because they relate to the
pounds of U3O8 in ending inventory and do not relate to the pounds of U3O8

sold
during the period.




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In the three and nine months ended September 30, 2021, cost of sales per the
financial statements included $1.7 million and $5.2 million, respectively, in
lower of cost or NRV adjustments. With production rates held to these
intentionally lower levels, virtually all production costs during 2021 will be
charged to cost of sales as NRV adjustments. In the three and nine months ended
September 30, 2020, cost of sales per the financial statements included $1.8
million and $6.3 million, respectively, in lower of cost or NRV adjustments.



All sales in 2020 were from purchased product. The weighted average purchase price was $25.83 per pound.





Gross Profit



The gross loss per the financial statements for the three and nine months ended
September 30, 2021, was $1.7 million and $5.2 million, respectively. As there
were no U3O8 sales during the nine months ended September 30, 2021, the losses
were composed of NRV adjustments. The gross loss per the financial statements
for the three and nine months ended September 30, 2020, was $1.8 million and
$6.3 million, respectively. Excluding the lower of cost or NRV adjustments, the
U3O8 gross profit was $3.1 million for the nine months ended September 30, 2020,
which represents a gross profit margin of approximately 38 percent.



Operating Costs


Operating costs include exploration and evaluation expense, development expense, general and administration expense, and accretion expense.

The following table summarizes the operating costs for the three and nine months ended September 30, 2021, and 2020:






                               Three months ended          Nine months ended
                                  September 30,              September 30,
     Operating Costs            2021          2020          2021         2020

Exploration and evaluation          515          474          1,671       1,419
Development                         583          284          1,048         900
General and administration        1,368        1,254          4,090       3,694
Accretion                           119          145            365         433

                                  2,585        2,157          7,174       6,446




Total operating costs for the three and nine months ended September 30, 2021,
were $2.6 million and $7.2 million, respectively. Total operating expenses for
the three and nine months ended September 30, 2020, were $2.2 million and $6.4
million, respectively. The increase in 2021 was primarily related to the payment
of bonuses in 2021. There were no bonuses paid in 2020.



Exploration and evaluation expense consists of labor and the associated costs of
the exploration, evaluation, and regulatory departments, as well as land holding
and exploration costs on properties that have not reached the development or
operations stage. The total expense for the three months ended September 30,
2021, and 2020 were similar. The $0.3 million increase in the nine months ended
September 30, 2021, was primarily due to bonus payments in 2021, which were
partially offset by savings realized from labor reductions and relocating the
Casper operations office to a smaller, less expensive, office building.




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Development expense includes costs incurred at the Lost Creek Project not
directly attributable to production activities, including wellfield
construction, drilling, and development costs. It also includes costs associated
with the Shirley Basin Project, which is in a more advanced stage. Lucky Mc,
which is an historic mine site, has also been classified as a development
project. During 2021 Q3, all remaining reclamation obligations on the Lucky Mc
property were satisfied and the permit to mine and related bond requirements
were terminated. The $0.3 million and $0.1 million increases in development
expense during the three and nine months ended September 30, 2021, respectively,
related to repair costs of drainage channels at Shirley Basin that were damaged
by a heavy rainstorm.


General and administration expense relates to the administration, finance, investor relations, land, and legal functions, and consists principally of personnel, facility, and support costs. The $0.1 million and $0.4 million increases in the three and nine months ended September 30, 2021, were primarily related to the 2021 bonus payments, which were partially offset by savings realized from labor reductions in 2020.





Other Income and Expenses


Net interest expense increased slightly in 2021 because of lower interest income received from restricted cash deposit accounts as compared to 2020.





For the three months ended September 30, 2021, the warrant liability mark to
market adjustment changed from a gain of $0.6 million in the comparable period
in 2020 to a loss of $5.1 million in 2021. For the nine months ended September
30, 2021, the warrant liability mark to market adjustment changed from a gain of
$0.6 million in the comparable period in 2020 to a loss of $11.4 million in
2021. As a part of the September 2018 underwritten public offering, the August
2020 registered direct offering, and the February 2021 underwritten public
offering, we sold warrants that were priced in U.S. dollars. Because the
functional currency of the Ur-Energy Inc. entity is Canadian dollars, a
derivative financial liability was created. The liability was originally
calculated, and is revalued monthly, using the Black-Scholes model as there is
no active market for the warrants. Any gain or loss resulting from the
revaluation of the liability is reflected in other income and expenses for the
period.  During 2021, the Company's stock price, volatility, and other factors
used in the Black-Scholes model rose significantly, leading to a significant
increase in the warrant liability and corresponding mark to market losses.



As a result of the February 2021 underwritten public offering, the Company
received approximately $13.9 million in net proceeds from the offering. Because
the functional currency of the Ur­Energy Inc. entity is Canadian dollars, the
entity's USD bank account is revalued into Canadian dollars and any gain or loss
resulting from changes in the currency rates is reflected in other income and
expenses for the period. For the nine months ended September 30, 2021, the
foreign exchange loss was primarily due to the revaluation of the Canadian
entity's USD bank account.



On April 16, 2020, we obtained two SBA PPP loans (one for each of our
subsidiaries with U.S. payroll obligations) through the BOKF. Under the program,
as modified by the Flexibility Act and SBA and Treasury rulemakings, the
repayment of our loans, including interest, would be forgiven based on eligible
payroll, payroll-related, and other allowable costs incurred in a
twenty-four-week period following the funding of the loans. In December 2020, we
applied for loan forgiveness with the BOKF. The BOKF, after reviewing the loan
forgiveness applications, submitted them to the SBA for approval. The Company
received notifications in 2021 Q2 that the principal amount of $893 thousand and
accrued interest of approximately $10 thousand were forgiven under the terms of
the PPP. This was treated as a forgiveness of debt on the Consolidated
Statements of Operations for the nine-months ended September 30, 2021, and a
$903 thousand gain on debt forgiveness was recognized in other income.




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Earnings (loss) per Common Share





The basic and diluted loss per common share for the three and nine months ended
September 30, 2021, was $0.05 and $0.13, respectively. For 2020, the losses per
share were $0.02 and $0.06, respectively. The diluted loss per common share is
equal to the basic loss per common share due to the anti-dilutive effect of all
convertible securities in periods of loss.



Liquidity and Capital Resources





Cash and cash equivalents increased $29.1 million from the December 31, 2020,
balance of $4.3 million to $33.4 million as of September 30, 2021. Cash
resources consist of Canadian and U.S. dollar denominated deposit accounts and
money market funds. During the nine months ended September 30, 2021, we used
$9.1 million for operating activities, had minimal investing activities, and
generated $38.3 million from financing activities.



Operating activities used $9.1 million of cash for the nine months ended September 30, 2021. We spent $2.5 million on production related cash costs, operating costs consumed $5.6 million of cash, and we paid $0.6 million for interest payments on our state bond loan and $0.4 million for insurance premiums.

Investing activities used less than $0.1 million during the period.





Financing activities provided $38.3 million of cash in 2021. As described below,
on February 4, 2021, we closed a $15.2 million underwritten public offering.
After share issue costs, we received net proceeds of $13.9 million. During 2021,
we have received net proceeds of $16.6 million through our At Market facility.
We also received $7.8 million from the exercise of warrants and stock options.



Wyoming State Bond Loan



On October 23, 2013, we closed a $34.0 million Sweetwater County, State of
Wyoming, Taxable Industrial Development Revenue Bond financing program loan
("State Bond Loan"). The State Bond Loan calls for payments of interest at a
fixed rate of 5.75% per annum on a quarterly basis, which commenced January 1,
2014. The principal was to be payable in 28 quarterly installments, which
commenced January 1, 2015. The State Bond Loan is secured by all the assets at
the Lost Creek Project. As of September 30, 2021, the balance of the State

Bond
Loan was $12.4 million.



On October 1, 2019, the Sweetwater County Commissioners and the State of Wyoming
approved an eighteen-month deferral of principal payments beginning October 1,
2019. On October 6, 2020, the State Bond Loan was again modified to defer
principal payments for an additional eighteen months. Quarterly principal
payments are scheduled to resume on October 1, 2022, and the last payment will
be due on October 1, 2024.


Small Business Administration Loans

On April 16, 2020, we obtained two SBA PPP loans (one for each of our subsidiaries with U.S. payroll obligations) through the Bank of Oklahoma Financial ("BOKF"). The program was a part of the CARES Act enacted by Congress on March 27, 2020, in response to the COVID-19 (Coronavirus) pandemic. The combined loan amount was $0.9 million.





On June 5, 2020, the Flexibility Act became law. The Flexibility Act changes key
provisions of the PPP, including maturity of the loans, deferral of loan
payments, and the forgiveness of the PPP loans, with revisions being retroactive
to the date of the CARES Act.




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Under the PPP, as modified by the Flexibility Act, the repayment of our loans,
including interest, may be forgiven based on eligible payroll, payroll-related,
and other allowable costs incurred in a twenty-four-week period following the
funding of the loans. In December 2020, we applied for loan forgiveness with the
BOKF. After reviewing the loan forgiveness applications, BOKF submitted them to
the SBA for approval. The Company received notifications in 2021 Q2 that the
principal amount of $893 thousand and accrued interest of approximately $10
thousand were forgiven under the terms of the PPP. This was treated as a
forgiveness of debt on the Consolidated Statements of Operations for the
nine-months ended September 30, 2021, and a $903 thousand gain on debt
forgiveness was recognized in other income.



Universal Shelf Registration and At Market Facility


On May 15, 2020, we filed a universal shelf registration statement on Form S-3
with the SEC in order that we may offer and sell, from time to time, in one or
more offerings, at prices and terms to be determined, up to $100 million of our
Common Shares, warrants to purchase our Common Shares, our senior and
subordinated debt securities, and rights to purchase our Common Shares and/or
senior and subordinated debt securities. The registration statement became
effective May 27, 2020, for a three-year period.



On May 29, 2020, we entered into an At Market Issuance Sales Agreement (the
"Sales Agreement") with B. Riley Securities, Inc. (formerly, B. Riley FBR,
Inc.). On June 7, 2021, we amended and restated the Sales Agreement to include
Cantor Fitzgerald & Co. as a co-agent. Under the Sales Agreement, as amended, we
may, from time to time, issue and sell Common Shares at market prices on the
NYSE American or other U.S. market through the agents for aggregate sales
proceeds of up to $50 million.



In 2021 through September 30, we utilized the Sales Agreement for gross proceeds
of $16.6 million. In 2020 Q4, we utilized the Sales Agreement and received

gross
proceeds of $0.1 million.


2020 Registered Direct Offering





On August 4, 2020, the Company closed a $4.68 million registered direct offering
of 9,000,000 common shares and accompanying one-half common share warrants to
purchase up to 4,500,000 common shares, at a combined public offering price of
$0.52 per common share and accompanying warrant, with gross proceeds to the
Company of $4.68 million. After fees and expenses of $0.4 million, net proceeds
to the Company were $4.3 million.



2021 Underwritten Public Offering


The Company closed on February 4, 2021, a $15.2 million underwritten public
offering of 16,930,530 common shares and accompanying one-half common share
warrants to purchase up to 8,465,265 common shares, at a combined public
offering price of $0.90 per common share and accompanying one-half common share
warrant. The gross proceeds to Ur­Energy from this offering were approximately
$15.2 million. After fees and expenses of $1.3 million, net proceeds to the
Company were approximately $13.9 million.



Liquidity Outlook



As of October 27, 2021, we had $40.9 million of cash and cash equivalents
including an additional $8.2 million received from ATM sales and warrant
exercises which took place after September 30, 2021. In addition to our cash
position, our finished, ready-to-sell, conversion facility inventory, worth
$13.4 million at recent spot prices, is immediately realizable, if necessary. We
do not anticipate selling our existing finished-product inventory in the next 12
months unless it is advantageous to do so.




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Looking Ahead



Global recognition of nuclear energy's role in achieving net-zero carbon
emissions continues to foster renewed interest in the uranium sector in 2021.
The Paris Climate Agreement calls for net-zero carbon emissions by 2050, and
certain nations are now targeting earlier realization of net-zero. The U.S.
rejoined the agreement this year, and the Biden Administration continues to
voice support for the nuclear industry. Japan, several member nations of the
European Union, and the United Kingdom have all recently made announcements of
action plans placing nuclear energy as an integral part of the climate change
solution.



The support for nuclear energy this year has prompted financial funds and
uranium ETFs, as well as uranium developers and producers, to purchase uranium
inventories further supporting the uranium spot price. In July 2021, the newly
formed Sprott Physical Uranium Trust began its purchases of uranium and has
established the means in the equity markets to raise more than $1 billion for
such purchases. Subsequent to quarter-end, the most recent participant in the
long-term investment in uranium is the physical uranium fund formed by the
Kazakhs. That physical fund announced plans to raise as much as $500 million for
purchasing uranium. These events during Q3 and early Q4 have moved the spot
price more than 70 percent over 2021 lows and uranium equities have benefited.
Uranium spot prices marked a daily high of $50.50 in mid-September, before
holding in the mid- and upper-$40s more recently.



To date in 2021, the Company has raised $46.5 million. Our cash position as of
October 27, 2021, is $40.9 million. In addition to our strong cash position, we
have nearly 285,000 pounds of finished, U.S. produced U3O8 inventory, worth
approximately $13.4 million at recent spot prices. Our financial position
provides us with adequate funds to maintain and enhance operational readiness at
Lost Creek, as well as allowing us to preserve our existing inventory to sell
into higher prices. To further heighten our readiness to return to production
operations at Lost Creek, we commenced a drill and development program in
October. Initially, we are drilling, developing  and constructing an additional
header house (HH2-4) in our fully permitted MU2. We anticipate that when this
work is complete, we will advance a delineation drill program in MU2 in
preparation of operations beyond the fourth MU2 header house. The estimated cost
of these development programs is $2.2 million.



We continue to diligently work to optimize processes and refine production plans
to strengthen our operational readiness at Lost Creek. Our experienced Lost
Creek operational staff is prepared to expand uranium production to an
annualized run rate of up to 1.2 million pounds upon a "go" decision for ramp
up. Our current and planned development initiatives will further enhance our
operational readiness for a production ramp up, which will then include further
development work in both of the first two mine units, followed by the ten
additional mining areas as defined in the Lost Creek Property Preliminary
Economic Assessment, as amended. Following receipt of an approved license
amendment in 2021 Q2, the Lost Creek facility now has the constructed and
licensed capacity to process up to 2.2 million pounds of U3O8 per year and
sufficient mineral resources to feed the processing plant for many years to
come.



Lost Creek operations can increase to full production rates in as little as nine
months following a "go" decision, simply by developing additional header houses
within the fully permitted MU2. The ongoing development and construction will
shorten the time to production in HH2-4. Development expenses during the full
period of ramp up are estimated to be approximately $14 million. These planned
costs are nearly all related to MU2 drilling and header house construction of
HH2-4 and beyond. Our long-tenured operational and professional staff have
significant levels of experience and adaptability which will allow for an easier
transition back to full operations. Among our recent hires, we have been
fortunate to return three former employees to work. Having knowledgeable and
experienced staff return further enhances our preparations for production. We
are prepared to ramp up and to deliver future Lost Creek production inventory
into new sales contracts and the national uranium reserve when markets and the
implementation of the reserve permit.




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With all major permits and authorizations for our Shirley Basin Project now in
hand, we also stand ready to construct at the mine site when market conditions
warrant. We estimate up to nine years production at the project based upon the
mineral resources reported in the Shirley Basin Preliminary Economic Assessment.



We will continue to closely monitor the uranium market, the implementation of
the uranium reserve program, and other developments in the markets or from
Congress, which may positively impact the uranium production industry. Until
market conditions signal a decision for the return to production operations, we
will focus on maintaining safe and compliant operations while continuing to
enhance and leverage our operational readiness.



Transactions with Related Parties

There were no transactions with related parties during the quarter.





Proposed Transactions



A non-core, unpermitted, non-operating property held by Pathfinder is presently
considered to be an asset held for sale. The Company has a plan to sell the
asset and is considering an offer consisting of cash and mineral properties. The
asset's mineral property cost is shown in note 4 to the accompanying Unaudited
Consolidated Financial Statements.



Other than the proposed transaction, as is typical of the mineral exploration,
development, and mining industry, we will consider and review potential merger,
acquisition, investment and venture transactions and opportunities that could
enhance shareholder value. Timely disclosure of such transactions is made as
soon as reportable events arise.



Critical Accounting Policies and Estimates





We have established the existence of uranium resources at the Lost Creek
Property, but because of the unique nature of in situ recovery mines, we have
not established, and have no plans to establish, the existence of proven and
probable reserves at this project. Accordingly, we have adopted an accounting
policy with respect to the nature of items that qualify for capitalization for
in situ U3O8 mining operations to align our policy to the accounting treatment
that has been established as best practice for these types of mining operations.



The development of the wellfield includes injection, production and monitor well drilling and completion, piping within the wellfield and to the processing facility and header houses used to monitor production and disposal wells associated with the operation of the mine. These costs are expensed when incurred.

Mineral Properties

Acquisition costs of mineral properties are capitalized. When production is attained at a property, these costs will be amortized over a period of estimated benefit.

Development costs including, but not limited to, production wells, header houses, piping and power will be expensed as incurred as we have no proven and probable reserves.






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Inventory and Cost of Sales



Our inventories are valued at the lower of cost and net realizable value based
on projected revenues from the sale of that product. We are allocating all costs
of operations of the Lost Creek facility to the inventory valuation at various
stages of production with the exception of wellfield and disposal well costs
which are treated as development expenses when incurred. Depreciation of
facility enclosures, equipment and asset retirement obligations as well as
amortization of the acquisition cost of the related property is also included in
the inventory valuation. We do not allocate any administrative or other overhead
to the cost of the product.



Share-Based Expense


We are required to initially record all equity instruments including warrants, restricted share units and stock options at fair value in the financial statements.


Management utilizes the Black-Scholes model to calculate the fair value of the
warrants and stock options at the time they are issued. In addition, the fair
value of derivative warrant liability is recalculated monthly using the
Black-Scholes model with any gain or loss being reflected in the net income for
the period. Use of the Black-Scholes model requires management to make estimates
regarding the expected volatility of the Company's stock over the future life of
the equity instrument, the estimate of the expected life of the equity
instrument and the number of options that are expected to be forfeited.
Determination of these estimates requires significant judgment and requires
management to formulate estimates of future events based on a limited history of
actual results.


Off Balance Sheet Arrangements





We have not entered into any material off balance sheet arrangements such as
guaranteed contracts, contingent interests in assets transferred to
unconsolidated entities, derivative instrument obligations, or with respect to
any obligations under a variable interest entity arrangement.



Outstanding Share Data


As of October 27, 2021, we had outstanding 210,820,732 Common Shares and 11,102,167 options to acquire Common Shares.

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