14. DISCONTINUED OPERATIONS

In the third quarter of 2020, the Company made the strategic decision to focus its resources on its graphite business, as further discussed below, and discontinue its investment in its lithium business. On December 31, 2020 the Company entered into a securities purchase agreement pursuant to which it agreed to sell its subsidiaries engaged in the uranium business in Texas and New Mexico to enCore Energy. The transaction closed on December 31, 2020. The Company’s lithium business included mineral leases and water rights in Nevada and Utah. The Company elected not to renew the annual lease rentals on the mineral properties, which also voids the water rights.

In accordance with ASC 205-20 – “Discontinued Operations,” the enCore transaction represents a major strategic shift for Westwater and indicates the need to re-classify the Company’s uranium activities as discontinued operations and disclose the associated profit/loss of the Company’s uranium business as a separate line-item on the Company’s statement of operations for all periods presented. Accordingly, the Company’s uranium segment has been classified as a discontinued operation and is reported separate from continuing operations on the Consolidated Statement of Operations for all periods presented.

The Company considers assets to be held for sale when management approves and commits to a formal plan to actively market the assets for sale at a price reasonable in relation to fair value, the asset is available for immediate sale in its present condition, an active program to locate a buyer and other actions required to complete the sale have been initiated, the sale of the asset is expected to be completed within one year and it is unlikely that significant changes will be made to the plan. As a result, the assets and liabilities in the disposal group are classified as held for sale for all periods presented on the Condensed Consolidated Balance Sheet.

The carrying amounts of the major classes of assets and liabilities related to the Company’s discontinued uranium and lithium operations and classified as held for sale as of December 31, 2020 and 2019 were as follows:


	December 31,		December 31,
(thousands of dollars)	2020		2019
Net property, plant and equipment	$	—	$	11,342
Operating lease right-of-use assets		—		14
Restricted cash		—		3,787
Assets Held for Sale, non-current		—		15,143

Total Assets Held for Sale	$	—	$	15,143

Asset retirement obligations - current	$	—	$	894
Operating lease liability - current		—		6
Current Liabilities Held for Sale		—		900

Asset retirement obligations, net of current		—		5,406
Operating lease liability, net of current		—		8
Liabilities Held for Sale, non-current		—		5,414

Total Liabilities Held for Sale	$	—	$	6,314

The results of the Company’s uranium and lithium business segments included in discontinued operations for the years ended December 31, 2020 and 2019 were as follows:



	For the Year Ended December 31,
(thousands of dollars)	2020		2019
Mineral property expenses	$	(2,606)	$	(2,416)
Product development expenses		—		—
General and administrative expenses		(1,665)		(1,612)
Arbitration costs		—		—
Accretion of asset retirement obligations		(201)		(390)
Depreciation and amortization		(38)		(67)
Impairment of uranium properties		(5,200)		(143)
Loss on sale of marketable securities
Interest income		10		65
Gain on sale of fixed assets		21		2
Other income (expense)		17		—
Net Loss from Discontinued Operations	$	(9,662)	$	(4,561)

LOSS PER SHARE FROM DISCONTINUED OPERATIONS	$	(1.10)	$	(2.33)
WEIGHTED AVERAGE NUMBER OF SHARES OUTSTANDING		8,799,190		1,961,086

Our cash flow information for 2020 and 2019 included the following activities related to discontinued operations:


	For the Year Ended
	December 31,
(thousands of dollars)		2020		2019
Depreciation and amortization	$	38	$	67
Capital Expenditures		81		-
Accretion of asset retirement obligations		201		390
Impairment of uranium properties		5,200		143