Honeymoon Mine

The Honeymoon uranium project is an in situ recovery uranium development project located in South Australia, approximately 75 kilometres northwest of the city of Broken Hill, New South Wales, Australia. Uranium One owns 100% of the Honeymoon uranium project.

Production

Pilot production (commissioning) at the Honeymoon project commenced in September 2011.  Commissioning will be completed when a pre-defined operating level, based on the design of the plant, is maintained.

The project has a design capacity of 880,000 lbs U₃O₈ (339 t U) per year.

Uranium is extracted at the Honeymoon project using the in situ recovery method, and processed using solvent extraction technology at a processing facility on site.

Most recently, in 2011, Honeymoon produced 100,000 lbs U₃O₈ (38 t U), of which 51,000 lbs U₃O₈ (20 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 Honeymoon project as at December 31, 2011.

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 were prepared using the polygonal (block) method and 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.  Mineral Reserve estimates are based on 64% extraction of Mineral Resources, a grade cut-off of 0.07% U3O8 and a long-term price of $60/lb U3O8 ($156/kg U). Mineral Resource estimates are based on a block cut-off grade of 0.03% U3O8 over 0.5 m minimum thickness and a price of $75/lb U3O8 ($195/kg U).  Since the estimation of the Mineral Resources and Mineral Reserves at a project intrinsically depends on the assessment of the economic viability of the project, any factor which affects the economic viability of the project, including factors which affect rights to the project or the operation of the project, will necessarily also affect the estimate of Mineral Resources and Mineral Reserves.  Mr. M.H.G. Heyns, Pr.SCI.Nat. (SACNASP), MSAIMM, MGSSA, Senior Vice-President of Uranium One, is the qualified person who prepared or supervised the preparation of the information that forms the basis of the foregoing scientific and technical disclosure on the Honeymoon Uranium Mine.

(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.