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 and provides information through July
28, 2021. 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 and SBA Paycheck Protection Program

During the quarter, we have adapted accordingly to continuing changes in COVID-19 related restrictions and guidance. We continue to monitor State, Federal and public health guidance as it evolves. Following one case of COVID-19 among our staff in 2020 Q4, staff have experienced no further cases of COVID-19.





In response to the COVID-19 pandemic, Congress enacted the CARES Act on March
27, 2020, which created the Paycheck Protection Program ("PPP") through the
Small Business Administration ("SBA"). As an eligible borrower under the
program, we secured two loans, one for each of our subsidiaries with U.S.
payroll obligations. The combined loan amount of $0.9 million was received

on
April 16, 2020.




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We applied for forgiveness of the full amount of the two loans under the program and, during 2021 Q2, we received notices that our applications had been approved. Both loans were fully forgiven. See note 10 to the accompanying Unaudited Consolidated Financial Statements.





Uranium Market Update



The Biden Administration is prioritizing climate change initiatives and 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.

The U.S. Department of Energy continues its work to implement the new national uranium reserve which was established in December 2020.


During the quarter, Wyoming Governor Mark Gordon, together with TerraPower and
PacifiCorp power company, announced the selection of Wyoming for the launch of
an advanced modular nuclear reactor demonstration project.



Supply-demand fundamentals continue to strengthen with projections for sustained
growth of global nuclear power in coming years through traditional uses and the
construction of advanced reactors of various types. Additionally, growing
numbers of countries are making commitments to net-zero emissions, which will
likely require nuclear energy to meet such objectives.



Russell Index



The Company joined the Russell 3000Ò Index at the conclusion of the 2021 Russell
indexes annual reconstitution, effective after the U.S. market opened on June
28, 2021. Annual Russell indexes reconstitution captures the 4,000 largest U.S.
stocks as of May 7, ranking them by total market capitalization. Membership in
the U.S. all-cap Russell 3000Ò Index, which remains in place for one year, means
automatic inclusion in the large-cap Russell 1000Ò Index or small-cap Russell
2000Ò Index as well as the appropriate growth and value style indexes. FTSE
Russell determines membership for its Russell indexes primarily by objective,
market-capitalization rankings and style attributes.

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. 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 the
implementation of the national uranium reserve, further relief pursuant to the
recommendations of the United States Nuclear Fuel Working Group (the "Working
Group") and 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. These
preparations include advanced planning for anticipated drilling and production
well installation in our fully permitted Mine Unit 2 ("MU2").




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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.
During 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



As previously disclosed, during 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 have been initiated
in 2021 Q3. We anticipate up to nine years production at the site.




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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.

U3O8 Production and Ending Inventory





                       Unit       2020 Q3       2020 Q4       2021 Q1       2021 Q2       2021-06 YTD

U3O8 Production

Pounds captured         lb           2,503            54            49            58               107
Pounds drummed          lb           4,926         6,622             -             -                 -
Pounds shipped          lb               -             -        15,873             -            15,873
Pounds purchased        lb               -             -             -             -                 -

U3O8 Ending
Inventory

Pounds
In-process              lb
inventory                            6,901           303           318           365
Plant inventory         lb           9,251        15,873             -             -
Conversion
inventory -             lb
produced                           219,735       219,735       235,608       267,617
Conversion
inventory -             lb
purchased                           48,750        48,750        48,750        16,741
                        lb         284,637       284,661       284,676       284,723

Value
In-process
inventory              $000      $       -     $       -     $       -     $       -
Plant inventory        $000      $     268     $     463     $       -     $       -
Conversion
inventory -
produced               $000      $   6,083     $   6,083     $   6,592     $   7,487
Conversion
inventory -
purchased              $000      $   1,268     $   1,268     $   1,268     $     435
                       $000      $   7,619     $   7,814     $   7,860     $   7,922

Cost per Pound
In-process             $/lb
inventory                        $       -     $       -     $       -     $       -
Plant inventory        $/lb      $   28.97     $   29.17     $       -     $       -
Conversion
inventory -            $/lb
produced                         $   27.68     $   27.68     $   27.98     $   27.98
Conversion
inventory -            $/lb
purchased                        $   26.01     $   26.01     $   26.01     $   25.98
                       $/lb      $   26.77     $   27.45     $   27.61     $   27.82

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




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 during the year. Pounds captured decreased nearly 80 percent
during the year and will remain low until a decision to ramp up is made.




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As of June 30, we had approximately 284,358 pounds of U3O8 at the conversion
facility including 267,617 produced pounds at an average cost per pound of
$27.98, 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.

Three and six months ended June 30, 2021 compared to the three and six months ended June 30, 2020

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





                                                   Three months ended
                                                        June 30,
                                            2021         2020          Change

Sales                                            7         6,934         (6,927 )
Cost of sales                               (1,835 )      (6,517 )        4,682
Gross profit (loss)                         (1,828 )         417         (2,245 )

Operating costs                             (2,777 )      (2,227 )         (550 )
Profit (loss) from operations               (4,605 )      (1,810 )

(2,795 )


Net interest expense                          (187 )        (195 )

8


Warrant mark to market gain                 (2,920 )        (231 )       (2,689 )
Foreign exchange gain (loss)                   (71 )          (8 )         

(63 )
Other income (expense)                         904            17            887
Net income (loss)                           (6,879 )      (2,227 )       (4,652 )


Foreign currency translation adjustment         34             4

30


Comprehensive income (loss)                 (6,845 )      (2,223 )

(4,622 )



Income (loss) per common share:
Basic                                        (0.04 )       (0.02 )        (0.02 )
Diluted                                      (0.04 )       (0.02 )        (0.02 )

U3O8 pounds sold                                 -       167,000       (167,000 )

U3O8 price per pounds sold                       -         41.50         (41.50 )

U3O8 cost per pounds sold                        -         26.01         (26.01 )

U3O8 gross profit per pounds sold                -         15.49         (15.49 )





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





                                                     Six months ended
                                                         June 30,
                                            2021          2020          Change

Sales                                             7         8,304         (8,297 )
Cost of sales                                (3,508 )      (9,622 )        6,114
Gross profit (loss)                          (3,501 )      (1,318 )       (2,183 )

Operating costs                              (4,589 )      (4,289 )         (300 )
Profit (loss) from operations                (8,090 )      (5,607 )

(2,483 )


Net interest expense                           (376 )        (327 )          (49 )
Warrant mark to market gain                  (6,324 )          42         (6,366 )
Foreign exchange gain (loss)                   (367 )           7          

(374 )
Other income (expense)                          906            17            889
Net income (loss)                           (14,251 )      (5,868 )       (8,383 )


Foreign currency translation adjustment         253            31

222


Comprehensive income (loss)                 (13,998 )      (5,837 )

(8,161 )



Income (loss) per common share:
Basic                                         (0.08 )       (0.04 )        (0.04 )
Diluted                                       (0.08 )       (0.04 )        (0.04 )

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 in the first six months of 2021 and we do not anticipate
making any sales in 2021. We sold 167,000 and 200,000 pounds of U3O8 during the
three and six months ended June 30, 2020, respectively, for an average price of
$41.50 per pound. 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 months and six months ended June 30, 2021, cost of sales per the
financial statements included $1.8 million and $3.5 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 six months ended
June 30, 2020, cost of sales per the financial statements included $2.2 million
and $4.5 million, respectively, in lower of cost or NRV adjustments.

All sales in 2020 were from purchased product. The weighted average purchase price was $26.01 and $25.83 for the three and six months, respectively, per pound.





Gross Profit



The gross loss per the financial statements for the three and six months ended
June 30, 2021 was $1.8 million and $3.5 million, respectively. As there were no
U3O8 sales during the six months ended June 30, 2021, the losses were composed
of NRV adjustments. The gross profit (loss) per the financial statements for the
three and six months ended June 30, 2020 was a profit of $0.4 million and a loss
of $1.3 million, respectively. Excluding the lower of cost or NRV adjustments,
the U3O8 gross profit was $2.6 million and $3.1 million for the three and six
months, respectively, which represents gross profit margins of approximately 37
percent and 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 six months ended June 30, 2021 and 2020:





                               Three months ended          Six months ended
                                    June 30,                   June 30,
     Operating Costs            2021          2020         2021         2020

Exploration and evaluation          693          554         1,156         945
Development                         333          343           465         616
General and administration        1,628        1,185         2,722       2,439
Accretion                           123          145           246         289

                                  2,777        2,227         4,589       4,289





Total operating costs for the three and six months ended June 30, 2021 were $2.8
million and $4.6 million, respectively. Total operating expenses for the three
and six months ended June 30, 2020 were $2.2 million and $4.3 million,
respectively. The increase in 2021 was primarily related to the payment of
bonuses in Q2. 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 $0.1 million and $0.2 million increases in the three and
six months ended June 30, 2021 were primarily due to the bonus payments in Q2
and exploration activities on the Excel gold project in Nevada, 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, and Lucky Mc,
which is near the end of reclamation at the historic mine site. The $0.2 million
year to date decrease in 2021 primarily related to lower development labor costs
at Lost Creek partially offset by higher permitting costs at Shirley Basin.



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 $0.4 million and $0.3 million
increases in the three and six months ended June 30, 2021 were primarily related
to the bonus payments in Q2, partially offset by savings realized from labor
reduction.



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.


The warrant mark to market loss increased from $0.2 million in 2020 Q2 to a loss
of $2.9 million in 2021 Q2. For the six months ended June 30, 2021 the loss
increased $6.4 million from the same period in 2020. 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 quarterly, using the
Black-Scholes technique 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 calculation 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 six months ended June 30, 2021, the foreign
exchange loss was primarily due to the revaluation of the 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 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 three-months ended June 30, 2021 and a $903
thousand gain on debt forgiveness was recognized in other income.

Earnings (loss) per Common Share





The basic and diluted loss per common share for the three and six months ended
June 30, 2021 was $0.04 and $0.08, respectively. For 2020, the losses per share
were $0.02 and $0.04, 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.




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Liquidity and Capital Resources





Cash and cash equivalents increased $17.2 million from the December 31, 2020
balance of $4.3 million to $21.5 million as of June 30, 2021. Cash resources
consist of Canadian and U.S. dollar denominated deposit accounts and money
market funds. During the six months ended June, 30, 2021 we used $5.8 million
for operating activities, had minimal investing activities, and generated $23.0
million from financing activities.



Operating activities used $5.8 million of cash in 2021. We spent $1.7 million on
production related cash costs, operating costs consumed $3.8 million of cash and
we paid $0.3 million in interest payments on our state bond loan.

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





Financing activities provided $23.0 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 $6.7 million through our At Market facility. We
also received $2.4 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 June 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.



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 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
three-months ended June 30, 2021 and a $903 thousand gain on debt forgiveness
was recognized in other income.




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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 Q2, we utilized the Sales Agreement for gross proceeds of $6.9 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 July 28, 2021, our unrestricted cash position was $20.8 million.





In addition to our cash position, our finished, ready-to-sell, conversion
facility inventory, worth $9.2 million at recent spot prices, is immediately
realizable, if necessary. After completing the financing activities discussed
above, we do not anticipate selling our existing finished-product inventory in
2021 at spot market prices. As discussed below, we currently intend to preserve
our U.S. origin pounds for possible delivery into the U.S. uranium reserve
program, which has been signed into law but not yet implemented.



Looking Ahead



International recognition of nuclear power's role in achieving net-zero carbon
emissions goals has resulted in a renewed interest in the uranium sector in
2021. The Paris Climate Agreement calls for net-zero carbon emissions by 2050
and the U.S. has rejoined the agreement under the Biden Administration, which
continues to demonstrate support for the nuclear industry.




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In February 2021, we raised gross proceeds of $15.2 million through an
underwritten public offering. After fees and expenses of $1.3 million, net
proceeds to the Company were $13.9 million.  Our current cash position as of
July 28, 2021, is $20.8 million. In addition to our strong cash position, we
have nearly 285,000 pounds of finished, U.S. produced inventory, worth $9.2
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
preserve our existing inventory for higher prices.



We continue to optimize processes and refine production plans to strengthen our
operational readiness at the fully permitted Lost Creek mine and plant. After
recent receipt of an approved license amendment, 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. We remain prepared to expand uranium production at Lost
Creek to an annualized run rate of up to 1.2 million pounds. A ramp-up of
production at Lost Creek would initially include further development work in the
first two mine units, followed by the ten additional mining areas as defined in
the Lost Creek Property Preliminary Economic Assessment, as amended.



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. Lost Creek operations can increase to full production rates in
as little as six months following a go decision, simply by developing additional
header houses within the fully permitted MU2. Development expenses during this
six-month ramp up period are estimated to be approximately $14 million and are
almost entirely related to MU2 drilling and header house construction costs. We
are prepared to ramp up and to deliver our Lost Creek production inventory to
the new national uranium reserve.



Additionally, with all major permits and authorizations for our Shirley Basin
Project now in hand, we 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 and any actions or
remedies resulting from the Working Group's report, the implementation of the
uranium reserve program, or any further legislative actions, which may
positively impact the uranium production industry. Until such time, we will
continue to minimize costs and maximize the 'runway' to maintain our current
operations and the operational readiness needed to ramp-up production when
called upon.

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 and asset retirement obligation are 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.




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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.





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 warrants is recalculated quarterly 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 July 28, 2021, we had outstanding 195,407,043 Common Shares and 9,807,551 options to acquire Common Shares.






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