MINERAL RIGHTS AND PROPERTIES

9 Months Ended

Apr. 30, 2013

MINERAL RIGHTS AND PROPERTIES [Text Block]

NOTE 5: MINERAL RIGHTS AND PROPERTIES

Mineral Rights

At April 30, 2013, 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 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 April 30, 2013, 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:

		April 30, 2013			July 31, 2012
Mineral Rights and Properties, Unproven
Palangana Mine	$	7,045,457		$	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
Welder Project		182,500			-
Anderson Project		9,154,268			9,154,268
Workman Creek Project		1,287,158			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		881,453			857,119
		43,167,535			42,425,697
Accumulated Depletion		(1,932,227	)		(1,057,495	)
		41,235,308			41,368,202
Databases		2,345,038			2,345,038
Accumulated Amortization		(1,626,129	)		(1,374,484	)
		718,909			970,554
Land Use Agreements		390,155			375,155
Accumulated Amortization		(147,253	)		(118,991	)
		242,902			256,164
	$	42,197,119		$	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 and nine months ended April 30, 2013 and 2012 are as follows:

		Three Months Ended April 30,				Nine Months Ended April 30,
		2013		2012		2013		2012
Mineral Property Expenditures
Palangana Mine	$	756,414	$	1,465,673	$	3,724,668	$	5,833,106
Goliad Project		145,390		91,654		369,375		398,632
Burke Hollow Project		572,578		-		1,894,411		-
Channen Project		29,983		-		805,791		-
Salvo Project		4,723		415,566		22,749		969,065
Nichols Project		-		-		13,635		150,000
Anderson Project		-		185,497		74,924		339,390
Workman Creek Project		-		40,346		32,640		47,735
Slick Rock Project		29,910		3,477		116,762		17,196
Yuty Project		26,831		588,548		134,791		588,548
Coronel Oviedo Project		88,210		923,263		433,802		1,829,126
Other Mineral Property Expenditures		173,108		297,965		486,148		734,482
	$	1,827,147	$	4,011,989	$	8,109,696	$	10,907,280

During the three and nine months ended April 30, 2013 and 2012, the Company did not incur any impairment charges.

Welder Project

During the nine months ended April 30, 2013, the Company entered into a mining lease and surface use agreement granting the Company exclusive right to explore, develop and mine for uranium in the Welder Project, a 1,825 -acre property located in the Bee County, Texas. The consideration paid by the Company was $182,500 in cash, which was capitalized as mineral rights and properties on the Company’s consolidated balance sheets.

Workman Creek Project

Pursuant to a Property Acquisition Agreement dated November 7, 2011, as amended on November 25, 2011, and effective November 30, 2011, the Company acquired from Cooper Minerals, Inc. (“Cooper”) an undivided 100% interest in the Workman Creek Project located in Gila County, Arizona. The Workman Creek Project is subject to a 3.0% net smelter revenue royalty requiring an annual advance royalty of $100,000.

During the nine months ended April 30, 2013, the advance royalty of $100,000 for calendar year 2012 was capitalized as mineral rights and properties on the Company’s consolidated balance sheets.

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 nine months ended April 30, 2013, 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.