ASSET RETIREMENT OBLIGATIONS

9 Months Ended

Apr. 30, 2014

ASSET RETIREMENT OBLIGATIONS [Text Block]

NOTE 9: ASSET RETIREMENT OBLIGATIONS

The Company's asset retirement obligations (ARO) relate to site restoration for the Hobson Processing Facility, Palangana Mine and Mt. Lucas assumed as part of the STMV Acquisition.

		April 30, 2014			July 31, 2013
Opening balance	$	4,078,080		$	3,112,374
Revision in estimate of asset retirement obligations		(381,197	)		435,758
Additions of asset retirement obligations		-			435,004
Liabilities settled with cash		(23,382	)		(109,916	)
Accretion		216,136			204,860
		3,889,637			4,078,080
Less: current portion of asset retirement obligations		-			(836,073	)
Long-term asset retirement obligations	$	3,889,637		$	3,242,007

		April 30, 2014		July 31, 2013
Undiscounted amount of estimated cash flows	$	6,382,549	$	5,975,265
Payable in years		2.5 to 12		2.5 to 12
Inflation rate		1.56% to 2.43%		1.56% to 2.43%
Discount rate		5.00% to 10.50%		5.00% to 10.50%

On May 2, 2014, the Texas Commission on Environmental Quality, upon receiving concurrence from the U.S. Nuclear Regulatory Commission, approved the Company's application for release of the Mt. Lucas site to unrestricted use, thereby officially completing the Mt. Lucas reclamation project. As a result, the Company derecognized the remaining ARO liabilities of $11,236 associated with Mt. Lucas and recorded a gain on settlement of ARO on the consolidated statement of operations for the three months ended April 30, 2014.

The undiscounted amounts of estimated cash flows for the next five years and beyond are as follows:

Undiscounted estimated cash flow for the next five years
July 31, 2014	$	-
July 31, 2015		681,655
July 31, 2016		-
July 31, 2017		940,161
July 31, 2018		635,932
Remaining balance		4,124,801
	$	6,382,549