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Article Excerpt
Original Source: FD (FAIR DISCLOSURE) WIRE
OPERATOR: Good morning, ladies and gentlemen. Welcome to the Uranium One conference call. I would now like to turn the meeting over to Mr. Neal Froneman, President and CEO of Uranium One. Please go ahead, Mr. Froneman.
NEAL FRONEMAN, PRESIDENT, CEO, SXR URANIUM ONE INC.: Thank you, operator, and good morning, ladies and gentlemen. It's indeed a pleasure today to have the opportunity to present the combination of Uranium One and Energy Metals, a transaction that will result in the creation of the leading Uranium company in the United States and further will strengthen our position as a senior uranium producer. With me today on this call, we have Chris Sattler, our Senior Vice President of Investor Relations for Uranium One and from the Energy Metals side with me here in Toronto, I'm pleased to say we have William Sheriff, the Chairman of the Company, Paul Matysek, President and CEO and (inaudible) the V.P. of Strategic Communication. I'd like to now hand over to Chris Sattler just to take us through our legal disclaimer and some additional information about this transaction. Chris, thank you.
CHRIS SATTLER, SVP OF IR, SXR URANIUM ONE INC.: Thanks, Neal. Just on the cautionary statement, readers are advised to refer to in the technical report containing detailed information with respect to the material properties of both of URANIUM ONE and EMC. These technical reports are available under the profiles of Uranium One and UrAsia Energy in the case of Uranium ONE and EMC at SEDAR.com and provide the date of each resource and reserve estimate details of the key assumptions, methods, and parameters used in the estimate, details of quality and grade or quality of each resource or reserve and a general discussion to the extent to which the estimate may be materially affected by any known environmental permitting legal taxation, socio-political, marketing, or other relevant issue. These technical reports also provide information with respect to data verification and the estimation.
This presentation will be using the terms measured, indicated and inferred resources as defined in accordance with National Instrument 43101, Standards of Disclosure for Mineral Project. United States readers and listeners are advised that while these terms are recognized and required by Canadian Securities laws, the SEC does not recognize them. Readers are cautioned not to assume that all or any part of the mineral deposits in these categories will ever be converted into reserves. In addition, inferred resources have a great amount of uncertainty as to their existence into economic and legal feasibility and it cannot be assumed that all or any part of any inferred mineral resource will ever be upgraded to a higher category. Readers are cautioned not to assume that all or any part of an inferred resource exists or is economically or legally minable. Mineral resources are not mineral reserves and do not have demonstrated economic liability. Scientific and Technical information contained herein with respect to EMC's resources has been reviewed on behalf of EMC's by Dr. Art Ettlinger, a Chief Geologist for EMC and a qualified person for the purposes of 43101. Scientific and Technical information with respect to the Dominion Uranium project including the Dominion Dumps have been reviewed on behalf of Uranium One by Dr. Richard Stewart, Vice President Geology and Exploration. Scientific and Technical information in respect of the Honeymoon Project and the other Australian properties has been removed on behalf of Colin Skidmore -- on behalf of Uranium One by Colin Skidmore, Vice President of Exploration.
Both Dr. Stewart and Mr. Skidmore are qualified persons for the purposes of 43-101. Scientific and Technical information with respect to the Akdala Uranium Mine, the South Inkai and Kharasan projects in Kazakhstan as well as the Sheep Mountain property in the United States has been reviewed on behalf of Uranium One by Stewart Wallis,P. Geo, Consulting Geologist. Mr. Wallace is a qualified person for the purposes of 43101. All historical resource estimates included here in are based on prior data and reports obtained and prepared by previous operators in certain other information. These historical estimates should not be relied upon and no qualified person has done sufficient work to classify these historical resources as current estimate as current mineral resources or mineral reserves. Neither Uranium One nor EMC has completed the work necessary to verify the classification of the mineral resource estimates, neither EMC nor Uranium One is treating these historical estimates as current mineral resources or mineral reserves as defined in Sections 1.2 and 1.3 in National Instrument 43101.
Properties containing historical resource estimates will require further evaluation. Historical estimates referred to herein as Russian P1 resources are derived from Kazatomprom documents and entity of the government of Kazakhstan, although Russia P1 resources do not meet CIN's standards on mineral resource and reserve definitions, they are considered relevant because it's been demonstrated that within Uranium One's experience and similar types of deposits in Kazakhstan, that P1 resources can be reclassified through as inferred through additional drilling. However, there is less confidence to a Russian P1 resource since the P1 resource is estimated on the basis of a lower drill density. Certain statements herein, including any information as to the timing and completion of the proposed transaction, the potential benefits thereof, the future activities of and developments related to EMC and Uranium One prior to the proposed transaction and the combined company after the proposed transaction including market positions, future financial or operating performance are forward-looking statements and are subject to important risk factors and uncertainties. Forward-looking statements are necessarily based on a number of estimates and assumptions. Known and unknown factors could cause actual results to differ materially from those projected in the forward-looking statements.
Such factors include among others uranium and gold price volatility, the impact of any hedging activities, discrepancies between construction and the development of new deposits, success of exploration activities and permitting time lines, changes in national and local government legislation, taxation, control, regulation and political or economic developments in Canada, the United States, South Africa, Australia, Kazakhstan or other countries in which either corporation does or may carry out business in the future. Risks of sovereign investment, the speculative nature of uranium and gold exploration, development and mining, including the risks of obtaining necessary licenses and permits, dilution, competition, loss of key employees, additional funding, and defective title to mineral claims or property. In addition, there are risks and hazards associated with the business of uranium gold exploration, development, and mining, including environmental hazards, industrial accidents, unusual or unexpected formations, pressures, cave-ins, flooding and gold bullion losses, as well as the factors described or referred to in the sections entitled risk factors in Uranium One's AIF, which is available on SEDAR and a similar section entitled risk factors in EMC's AIF which is also available on SEDAR or the SEC on SEC.gov.
These should be reviewed in conjunction with this document. Accordingly, readers should not place undue reliance on forward-looking statements. Either corporation undertakes any obligation to update publicly or release any revisions to forward-looking statements to reflect events or circumstances after the date of this document or to reflect the occurrence of unanticipated events. There is additional information about this transaction subject to the terms and conditions set forth in the definitive agreement, EMC intends to file a notice of meeting managed information circular and related materials with Canadian Securities Regulatory Authority and the U.S. SEC relating to this proposed transaction. Uranium One intends to file a registration statement and prospectus with the SEC, including the EMC Management Information Circular and related materials relating to the proposed transaction. Shareholders are strongly advised to read these documents as well as any a amendments and supplements to these documents when they become available because they will contain important information. At that time, shareholders may obtain a free copy of the EMC Management Information Circular and related registration statements and prospectus at the SEC's Web site, www.SEC.gov. At that time free copies of these documents can also be obtained by directing a request to Uranium One at 390 Day Street, Suite 1610, Toronto, Ontario, M5H2Y2. You should read the Management Information Circular Prospectus and related materials carefully before making a decision concerning the proposed transaction.
NEAL FRONEMAN: Thank you, Chris. Ladies and gents, that's obviously important information. I would like to now move on to Slide Number 1, which is headed, Transaction Rationale. For Uranium One, this transaction is in-line with our well-documented strategy of value accretive external growth with a focus on the world's top five uranium resource jurisdictions, particularly the United States and Australia. The transaction also resulted enhanced geographic diversification for Uranium One and we believe creates a well balanced portfolio of assets around the world. We have long-stated publicly that we are focused on acquisition targets with advanced stage projects as well as companies with existing technical teams in place. The elite technical expertise at EMC in the United States is critical to deliver on the growth plans that we envisage for these assets. Importantly, this transaction is accretive to Uranium One's net asset value per share and to our medium to long-term cash flow per share. I would like to ask Paul Matysek to carry on with the Transaction Rationale from EMC's point of view?
PAUL MATYSEK, PRESIDENT, CEO OF EMC, SXR URANIUM ONE INC.: Thank you, Neal. From EMC's point of view, this transaction results in immediate exposure for EMC shareholders to you uranium production and cash flow. Uranium One's existing ISR key focus on Kazakhstan (inaudible) will enhance EMC's technical expertise in the United States. Furthermore, with a firm foundation in South Africa, Uranium One has in-house conventional money expertise that can be applied to EMC's conventional mining projects to the United States, which offers growth opportunities in addition to the ISR amenable projects. In summary, we believe this transaction results in the creation of a power house in the United States Uranium sector and goes a long ways towards realizing our goal to produce U.S. uranium for U.S. utilities. Slide 2, this a background for EMC. EMC has a very large and high quality profit of uranium resources throughout the United States with critical...
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