Property, Plant and Equipment

12 Months Ended

Dec. 31, 2016

Property, Plant and Equipment Assets Held-for-sale Disclosure [Abstract]

Property, Plant and Equipment

4. PROPERTY, PLANT AND EQUIPMENT

	Net Property, Plant and Equipment at December 31, 2016
(thousands of dollars)	Turkey	Texas	New Mexico	Corporate	Net book value
Uranium plant	$              -	$       8,459	$                    -	$               -	$            8,459
Mineral rights and properties	17,968	-	19,102	-	37,070
Other property, plant and equipment	22	1,224	-	141	1,387
Total net book value	$     17,990	$       9,683	$          19,102	$          141	$          46,916
	Net Property, Plant and Equipment at December 31, 2015
(thousands of dollars)	Turkey	Texas	New Mexico	Corporate	Net book value
Uranium plant	$              -	$       8,653	$                    -	$               -	$            8,653
Mineral rights and properties	17,968	1,513	19,102	-	38,583
Other property, plant and equipment	22	1,352	-	202	1,576
Total net book value	$     17,990	$     11,518	$          19,102	$          202	$          48,812

Lithium Properties

Columbus Basin project

As discussed in Note 3 above, the Company staked approximately 11,220 acres of unpatented placer mining claims in July and September 2016 in the Columbus Salt Marsh area of west-central Nevada. We hold these claims through the payment of annual claim maintenance fees to the U.S. Bureau of Land Management. There are no royalty obligations associated with this project.

Sal Rica project

As discussed in Note 3 above, the Company acquired approximately 9,900 acres of unpatented placer mining claims from Mesa. Additionally, subsequent to the purchase of these mining claims from Mesa, the Company staked an additional 3,360 acres of unpatented placer mining claims. We hold these claims through the payment of annual claim maintenance fees to the U.S. Bureau of Land Management. Additionally, the claims purchased from Mesa are subject to a 2% NSR royalty on future production. The remaining claims staked by the Company are not subject to any royalties or work commitments.

Uranium Properties

Temrezli project

As discussed in Note 3 above, the Temrezli project was acquired as part of the Anatolia Transaction. The Company controls five licenses that make up the Temrezli project area that were granted to our Turkey-based subsidiary Adur Madencilik Ltd Sti. by the Turkish General Directorate of Mining Affairs. The granted licenses cover an area of about 13,490 acres. We hold these licenses through the payment of fees to the Turkish government and the fulfillment of certain physical work obligations on an annual basis. Uranium production from the licenses is subject to the payment of a sliding scale royalty, ranging from 2% to 16% depending upon the sales price of uranium, as defined by Turkish mining law. The sliding scale royalty payments are to be made to certain agencies of the local and Turkish governments. A further 1% royalty is payable to the General Directorate of Mining Affairs, who discovered the Temrezli uranium deposit.

Kingsville Dome project

The Kingsville Dome project consists of mineral leases from private landowners on about 2,434 gross and 2,227 net acres located in central Kleberg County, Texas. The leases are held through the payment of annual rents, and the lease provide for the payment of production royalties ranging from 6.25% to 9.375%, based upon uranium sales from the respective leases. The leases have expiration dates ranging from 2000 to 2007 however we continue to hold most of these leases through our ongoing restoration activities. With a few minor exceptions, the leases contain clauses that permit us to extend the leases not held by production by payment of an annual per acre royalty ranging from $10 to $30. We have paid such royalties on all material acreage.

Rosita project

The Rosita project consists of mineral leases from private landowners on about 2,759 gross and net acres located in north-central Duval County, Texas. The Rosita South property consists of mineral leases from private land owners on about 1,795 gross acres and 1,479 net acres located in Duval County near the Company’s Rosita project. The leases provide for the payment to the landowners of sliding scale royalties based on a percentage of uranium sales. Royalty percentages on average increase from 6.25% up to 18.25% when uranium prices reach $80.00 per pound. Under the terms of the leases, the lands can be held after the expiration of the primary and secondary terms, as long as are carrying out restoration and reclamation activities. The leases have primary and secondary terms ranging from 2012 to 2015, and provisions to extend the leases beyond the initial terms. We are holding these leases by payment of rentals ranging from $10 to $30 per acre.

Vasquez project

The Vasquez project is comprised of a mineral lease on 872 gross and net acres located in southwestern Duval County, in South Texas. The primary term expired in February 2008; however we hold the lease by carrying out restoration and reclamation activities. We pay an annual rental fee to the landowner and the lease provides for the payment to the landowner royalties based upon 6.25% of uranium sales below $25.00 per pound and royalty rate increases on a sliding scale up to 10.25% for uranium sales occurring at or above $40.00 per pound.

Butler Ranch project

The Butler Ranch project was acquired as part of the Company’s Asset Exchange Agreement with Rio Grande Resources Corporation in November 2014. The property is comprised of nine fee leases that cover an area of about 1,322 gross or 1,262 net acres of mineral rights. We can hold the leases by payment of annual rental fees, ranging from $10 to $25 per acre. Each of the leases makes provision for the payment of royalties of 10% of sales to the property owners. Leases have initial terms of 8 to 10 years and have provisions to “hold by drilling” and identifying uranium mineralization on the specific properties.

Cebolleta project

In connection with the merger of Neutron (and its wholly-owned subsidiary Cibola Resources LLC (“Cibola”)) we acquired the Cebolleta Lease with La Merced del Pueblo de Cebolleta (the “Cebolleta Land Grant”), a privately held land grant, to lease the Cebolleta project, which is composed of approximately 6,717 acres of fee (deeded) surface and mineral rights. The Cebolleta Lease provides for: (i) a term of ten years and so long thereafter as Cibola is conducting operations on the Cebolleta project; (ii) initial payments to the Cebolleta Land Grant of $5.0 million; (iii) a recoverable reserve payment equal to $1.00 multiplied by the number of pounds of recoverable uranium reserves upon completion of a feasibility study to be completed within six years, less (a) the $5.0 million referred to in (ii) above, and (b) not more than $1.5 million in annual advance royalties previously paid pursuant to (iv); (iv) annual advanced royalty payments of $0.5 million; (v) gross proceeds royalties from 4.50% to 8.00% based on the then current price of uranium; (vi) employment opportunities and job-skills training for the members of the Cebolleta Land Grant and (vii) funding of annual higher education scholarships for the members of the Cebolleta Land Grant. The Cebolleta Lease provides Cibola with the right to explore for, mine, and process uranium deposits present on the Cebolleta project. In February 2012, Cibola entered into an Amendment of its Mining Lease Agreement (the “Cebolleta Lease Amendment”) amending the Cebolleta Lease, subject to approval of the Thirteenth Judicial District. Pursuant to the Cebolleta Lease Amendment, the date for the completion of the feasibility study was extended from April 2013 to April 2015. In addition, the date has been further extended subject to a reduction in the $6.5 million initial payment and annual advance royalty payments deduction to the recoverable reserve payment The Company intends to negotiate with the Cebolleta Land Grant on the terms for the continuation of the Cebolleta Lease.

Juan Tafoya project

In connection with the merger with Neutron we acquired the fee interest in 4,097 acres in northwestern New Mexico of fee (deeded) surface and mineral rights owned by the Juan Tafoya Land Corporation (“JTLC”) and 24 leases with private owners of small tracts covering a combined area of 115 acres. The lease has a term of ten years, and it can be extended on a year-to-year basis thereafter, so long as we are conducting operations on the property. Additionally, the lease required: (i) an initial payment of $1.25 million; (ii) annual rental payments of $0.2 million for the first five years of the lease and $0.3 million for the second five years; (iii) after the second five years, annual base rent of $75 per acre; (iv) a gross proceeds royalty of 4.65% to 6.5% based on the then current price of uranium; (v) employment opportunities and job-skills training programs for shareholders of the JTLC or its heirs, (vi) periodic contributions to a community projects fund if mineral production commences from the Juan Tafoya property and (vii) funding of a scholarship program for the shareholders of the JTLC or its heirs. The Company is obligated to make the first ten years’ annual rental payments notwithstanding the right to terminate the JTLC lease at any time, unless (a) the market value of uranium drops below $25 per pound, (b) a government authority bans uranium mining on the Juan Tafoya property, or (c) the deposit is deemed uneconomical by an independent engineering firm. The Company intends to negotiate with the JTLC on the terms for the continuation of the JTLC lease.

Impairment of Property, Plant and Equipment

The Company recorded the following impairment charges for 2016 and 2015 related to its uranium projects and processing facilities:

	For the years ended December 31,
	2016	2015
Kingsville Dome project	$                   160	$                   160
Butler Ranch project	579	-
Sejita Dome project	534	-
Nell project	209	-
Jack Pump project	191	-
Alta Mesa Este project	-	800
Total Impairment	$                1,673	$                   960

The Company’s recorded impairment charge for 2016 and 2015 of $0.2 million on its Kingsville Dome project was due to the physical deterioration of its processing plant equipment resulting from the plant’s idled status and its proximity to the Texas coastline. The net carrying value of the Kingsville Dome plant equipment after impairment is $0.2 million which is calculated as $2.2 million book value less a $2.0 million liability related to dismantling and decontaminating. The Company also used a third-party estimate of resale value to determine that no further impairment was needed as the Company’s third-party estimate of resale value exceeded the $0.2 million net carrying value of the Kingsville Dome plant equipment.

The Company’s recorded impairment charge for 2016 of $0.6 million on its Butler Ranch project was the result of declining uranium prices during 2016 as the carrying value exceeded the projects cash flows on an undiscounted and discounted basis. As a result, the entire carrying value of the Butler Ranch project was written to nil as it was determined that the entire investment was unrecoverable.

The Company’s recorded impairment charges for 2016 of $0.5 million on its Sejita Dome project, $0.2 million on its Nell project and $0.2 million on its Jack Pump project were the result of URI’s Board of Directors and management determining that exploration results indicated that these projects should be terminated. The Company’s impairment charge for 2015 of $0.8 million on its Alta Mesa Este project was the result of URI’s Board of Directors and management determining that recent exploration results indicated that the Alta Mesa Este project should be terminated. As a result, the carrying values of the projects were written down to nil.

Mineral Property Expenses

During the years ending December 31, 2016 and 2015, the Company’s mineral property expenses were $3.2 million and $4.5 million, respectively. Included within mineral property costs are standby costs for our three idled South Texas ISR projects along with holding, exploration and evaluation costs for all properties. The Company spent the following amounts for each of its material properties:

	For the year ended December 31,
	2016	2015
	(thousands of dollars)
Temrezli project, Turkey	$                  498	$                  407
Total Turkey projects	498	407
Kingsville Dome project, Texas	779	812
Rosita project, Texas	402	711
Vasquez project, Texas	461	510
Butler Ranch project, Texas	12	443
Other projects, Texas	94	553
Total Texas projects	1,748	3,029
Crownpoint project, New Mexico	5	5
Churchrock project, New Mexico	20	21
Cebolleta project, New Mexico	138	537
Juan Tafoya project, New Mexico	47	384
Other projects, New Mexico	5	87
Total New Mexico projects	215	1,034
Columbus Basin project, Nevada	232	-
Other projects, Nevada	31	-
Total Nevada projects	263	-
Sal Rica project, Utah	524	-
Total Utah projects	524	-
Total expense for the period	$               3,248	$               4,470