MINERAL RIGHTS AND PROPERTIES

9 Months Ended

Apr. 30, 2015

MINERAL RIGHTS AND PROPERTIES [Text Block]

NOTE 4: MINERAL RIGHTS AND PROPERTIES

Mineral Rights

At April 30, 2015, the Company had mineral rights in the States of Arizona, Colorado, New Mexico, Texas and Wyoming and the Republic of Paraguay. These mineral rights were acquired through staking and purchase, lease or option agreements and are subject to varying royalty interests, some of which are indexed to the sale price of uranium. At April 30, 2015, annual maintenance payments of approximately $1,016,000 are required to maintain these mineral rights.

Mineral rights and property acquisition costs consisted of the following:

		April 30, 2015			July 31, 2014
Mineral Rights and Properties, Unproven
Palangana Mine	$	6,587,135		$	6,664,260
Goliad Project		8,689,127			8,689,127
Burke Hollow Project		1,495,750			1,495,750
Longhorn Project		116,870			116,870
Salvo Project		364,710			364,710
Nichols Project		154,774			154,774
Anderson Project		9,154,268			9,154,268
Workman Creek Project		1,422,008			1,372,008
Los Cuatros Project		257,250			257,250
Slick Rock Project		661,271			661,271
Yuty Project		11,947,144			11,947,144
Coronel Oviedo Project		1,133,412			1,133,412
Other Property Acquisitions		285,740			262,115
		42,269,459			42,272,959
Accumulated Depletion		(3,859,648	)		(3,454,533	)
		38,409,811			38,818,426
Databases		2,405,038			2,405,038
Accumulated Amortization		(2,113,581	)		(1,928,901	)
		291,457			476,137
Land Use Agreements		390,155			390,155
Accumulated Amortization		(225,278	)		(196,019	)
		164,877			194,136
	$	38,866,145		$	39,488,699

During the nine months ended April 30, 2015, the asset retirement obligations (“ARO”) of the Palangana Mine were revised due to changes in the estimated timing of restoration and reclamation of the Palangana Mine. As a result, ARO liabilities and the corresponding mineral rights and properties associated with the Palangana Mine were reduced by $77,125.

The Yuty Project located in Paraguay was advanced from exploration phase to exploitation phase upon approval from the Ministry of Public Works and Communication, the national agency that regulates mining in Paraguay.

The Company has not established proven or probable reserves, as defined by the SEC under Industry Guide 7, through the completion of a “final” or “bankable” feasibility study for any of its mineral projects. The Company has established the existence of mineralized materials for certain uranium projects, including the Palangana Mine. Since the Company commenced uranium extraction at the Palangana Mine without having established proven or probable reserves, there may be greater inherent uncertainty as to whether or not any mineralized material can be economically extracted as originally planned and anticipated.

No revenues were generated from the sale of uranium concentrates during the nine months ended April 30, 2015 or Fiscal 2014. Historically, the Palangana Mine has been the Company’s sole source for uranium concentrates sold to generate its revenues during Fiscal 2013 and 2012, with no revenues generated prior to Fiscal 2012. The economic viability of the Company’s mining activities, including the expected duration and profitability of the Palangana Mine and of any future satellite ISR mines, such as the Goliad and Burke Hollow Projects, located within the South Texas Uranium Belt, has many risks and uncertainties. These include, but are not limited to: (i) a significant, prolonged decrease in the market price of uranium; (ii) difficulty in marketing and/or selling uranium concentrates; (iii) significantly higher than expected capital costs to construct the mine and/or processing plant; (iv) significantly higher than expected extraction costs; (v) significantly lower than expected uranium extraction; (vi) significant delays, reductions or stoppages of uranium extraction activities; and (vii) the introduction of significantly more stringent regulatory laws and regulations. The Company’s mining activities may change as a result of any one or more of these risks and uncertainties and there is no assurance that any ore body that we extract mineralized materials from will result in profitable mining activities.

Mineral property expenditures incurred by major projects were as follows:

		Three Months Ended April 30,				Nine Months Ended April 30,
		2015		2014		2015		2014
Mineral Property Expenditures
Palangana Mine	$	500,535	$	668,307	$	1,621,391	$	1,975,766
Goliad Project		25,631		419,278		79,924		1,591,309
Burke Hollow Project		94,702		750,907		1,235,250		1,348,976
Longhorn Project		22,276		21,852		52,999		50,552
Salvo Project		16,751		4,358		39,590		5,374
Anderson Project		50,142		45,290		173,564		172,975
Workman Creek Project		-		1,440		31,300		31,651
Slick Rock Project		2,924		10,309		52,708		61,320
Yuty Project		41,274		148,248		301,035		228,997
Coronel Oviedo Project		132,315		457,527		428,077		601,723
Other Mineral Property Expenditures		159,292		211,833		544,403		842,869
	$	1,045,842	$	2,739,349	$	4,560,241	$	6,911,512