The following discussion and analysis should be read in conjunction with our unaudited condensed consolidated financial statements for the three and six-month period ended
June 30, 2022(the "Quarter"), and the related notes thereto, which have been prepared in accordance with U.S.GAAP. Additionally, the following discussion and analysis should be read in conjunction with Management's Discussion and Analysis of Financial Condition and Results of Operations and the audited consolidated financial statements included in Part II of our Annual Report on Form 10-K for the year ended December 31, 2021. This Discussion and Analysis contains forward-looking statements and forward-looking information that involve risks, uncertainties and assumptions. Our actual results may differ materially from those anticipated in these forward-looking statements as a result of many factors. See section heading "Cautionary Statement Regarding Forward-Looking Statements," above. While the Company has established the existence of multiple Mineral Resources and extracts and processes saleable uranium from these operations, the Company has only established Proven Mineral Reserves or Probable Mineral Reserves, as defined under SEC S-K 1300, at its Sheep Mountain Project. As a result, the Company is a "Development Stage Issuer" as defined by S-K 1300, as it is engaged in the preparation of Mineral Reserves for extraction on at least one material property. Under U.S.GAAP, for a property that has no Proven or Probable Reserves, the Company capitalizes the cost of acquiring the property (including mineral properties and rights) and expenses all costs related to the property incurred subsequent to the acquisition of such property. Acquisition costs of a property are depreciated over its estimated useful life for a revenue-generating property or expensed if the property is sold or abandoned. Acquisition costs are subject to impairment if so indicated. All dollar amounts stated herein are in U.S.dollars, except share and per share amounts and currency exchange rates unless specified otherwise. References to Cdn$ refer to Canadian currency, and $ to United Statescurrency.
We responsibly produce several of the raw materials needed for clean energy and
advanced technologies, including uranium, rare earth elements and vanadium.
Our primary product is U3O8 (also known as natural uranium concentrate or yellowcake), which, when further processed, becomes the fuel for the generation of clean nuclear energy. According to the
Nuclear Energy Institute, nuclear energy provides nearly 20% of the total electricity and more than 50% of the clean, carbon-free electricity generated in the U.S. The Companygenerates revenues from extracting and processing materials for the recovery of uranium, vanadium and REEsfor our own account, as well as from toll processing materials for others.
Our natural uranium concentrate is produced from multiple sources:
•Conventional recovery operations at the Mill, including:
•Processing ore from uranium mines; and
•Recycling of Alternate Feed Materials, which are uranium-bearing materials that
are not derived from conventional ore; and
The Company also has a long history of conventional vanadium recovery at the Mill when vanadium prices support those activities. The Company holds several existing mines that contain vanadium resources, and the Mill has produced considerable quantities of vanadium from area mines during its operating history. From late 2018 to early 2020, the Company completed a campaign to recover vanadium from solutions in the tailings management system at the Mill ("Pond Return") from which it recovered over 1.8 million pounds of high-purity V2O5. The Company has also recovered uranium from Pond Return since 2015 and continues to evaluate opportunities for copper recovery from our
Pinyon Plain Project. The Company is also currently producing an intermediate REE product called mixed RE Carbonate. In 2020, the Company began evaluating the potential to recover REEsat the Mill. By October 2020, the Company had produced a mixed RE Carbonate, ready for separation, on a pilot scale from natural monazite sands. In December 2020, the Company entered into a contract to acquire natural monazite sands from a heavy mineral sands operation in Georgia, for the recovery of uranium and production of a commercially salable mixed RE Carbonate containing approximately 71% total rare earth oxide ("TREO") on a dry basis. In March 2021, the Company began ramping up commercial-scale production of mixed RE Carbonate from these natural monazite sands. In July 2021, the Company announced the signing of a definitive supply agreement and began commercial shipments of RE Carbonate to...