MINERAL RIGHTS AND PROPERTIES

3 Months Ended

Oct. 31, 2012

MINERAL RIGHTS AND PROPERTIES [Text Block]

NOTE 5:              MINERAL RIGHTS AND PROPERTIES

Mineral Rights

At October 31, 2012, the Company had mineral rights in the States of Arizona, Colorado, New Mexico, Texas and Wyoming and in the Republic of Paraguay. These mineral rights were acquired for the purposes of uranium mining and related activities, including exploration, development, extraction and processing of uranium concentrates, at a cost of $42,433,076, including $33,018,768 representing the fair value of non-cash consideration and $2,365,456 representing the present value of the retirement obligation associated with the Palangana Mine, net of $1,713,504 in impairment charges. 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 October 31, 2012, annual maintenance payments of approximately $1,186,000 are required to maintain these mineral rights.

Mineral rights and property acquisition costs consist of the following:

		October 31, 2012			July 31, 2012
Mineral Rights and Properties, Unproven
Palangana Mine	$	6,610,453		$	6,610,453
Goliad Project		8,689,127			8,689,127
Burke Hollow Project		1,313,250			1,313,250
Channen Project		428,164			428,164
Salvo Project		363,645			363,645
Nichols Project		154,774			154,774
Anderson Project		9,154,268			9,154,268
Workman Creek Project		1,187,158			1,187,158
Los Cuatros Project		257,250			257,250
Slick Rock Project		163,213			163,213
Todilto Project		166,720			166,720
Yuty Project		11,947,144			11,947,144
Coronel Oviedo Project		1,133,412			1,133,412
Other property acquisitions		864,498			857,119
		42,433,076			42,425,697
Accumulated depletion		(1,321,032	)		(1,057,495	)
		41,112,044			41,368,202
Databases		2,345,038			2,345,038
Accumulated amortization		(1,463,366	)		(1,374,484	)
		881,672			970,554
Land Use Agreements		375,155			375,155
Accumulated amortization		(128,370	)		(118,991	)
		246,785			256,164
	$	42,240,501		$	42,594,920

The Company has not established proven or probable reserves on any of its mineral projects.

Mineral property expenditures incurred by major projects during the three months ended October 31, 2012 and 2011 are as follows:

		Three Months Ended October 31,
		2012		2011
Mineral Property Expenditures
Palangana Mine	$	1,823,863	$	1,835,709
Goliad Project		104,002		96,938
Burke Hollow Project		1,102,932		-
Channen Project		691,262		-
Salvo Project		17,861		104,577
Nichols Project		13,635		150,000
Land work - Texas		61,342		96,477
Anderson Project		74,722		119,458
Workman Creek Project		30,936		-
Slick Rock Project		55,010		12,571
Yuty Project		91,270		-
Coronel Oviedo Project		199,801		263,218
Other Mineral Property Expenditures		110,649		53,652
	$	4,377,285	$	2,732,600

During the three months ended October 31, 2012 and 2011, the Company did not incur any impairment charges.

Yuty Project

The Company acquired the Yuty Project located in southeastern Paraguay in March 2012 through the acquisition of Cue Resources Ltd. (“Cue”).

During the three months ended October 31, 2012, the Company made cash payments totaling $42,850 as full settlements of a total $53,759 in accounts payable and accrued liabilities assumed from Cue, resulting in the recognition of a gain on settlement of accounts payable of $10,909.

Pursuant to a Settlement and Release Agreement dated and effective August 7, 2012 (the “Settlement Agreement”), the Company renegotiated certain acquisition and royalty agreement terms previously agreed to between Cue and the original property vendors of the Yuty Project. The Settlement Agreement confirms an overriding royalty payable to the property vendors of $0.21 for each pound of uranium produced from the Yuty Project, and supersedes all prior agreements entered into between Cue and the property vendors. As consideration for the Settlement Agreement, the Company paid $50,000 in cash and issued 75,000 restricted shares with fair value of $190,500.