Uranium Energy Corp. (UEC) Announces Developments on Palangana Project

Based in the United States with operations underway throughout North America, Uranium Energy Corp. is dedicated to furthering the production, development and exploration of uranium ore. UEC is focused on developing uranium sites and currently has two projects located in South Texas. One of these projects is the Palangana Project, which is an in-situ recovery (ISR) project that is steadily increasing production.

The Palangana Project is located in the South Texas uranium belt, a prime location for uranium development. Positioned approximately 100 miles south of the Hobson facility, the Palanga Project consists of approximately 6,200-acres. In the past, Union Carbide Corporation (UCC), Chevron and Everest Exploration Inc. drilled over 4,000 exploration, development and production holes. In the late 1970s, UCC produced uranium at the project using ISR technology. Harry Anthony, UEC’s Chief Operating Officer, was a member of UCC’s ISR mining team and oversaw the development and production of this project.

The latest 43-101 for Palangana was filed on Feb 23rd 2010. The Technical Report provides a Measured and Indicated Resource Estimate for the project of 1,057,000 pounds at an average grade of 0.135% eU3O8. This resource is located in two zones referred to as Production Area #1 and Production Area #2. An additional 1,154,000 pounds of eU3O8 at an average grade of 0.176% is classified as an Inferred Resource Estimate, and is located in six new exploration zones.

These resource estimates were completed by SRK Consulting U.S. Inc., and were based on the results from 2,694 drill holes at the Palangana Project completed by previous operators. The Resource Estimates are mainly located east of the Palangana Dome.

Uranium Energy has completed Phase I of the wellfield at Production Area 1, with more than 45 injection wells and production wells drilled, cased and tested. The average depth of wells throughout the PAA-1 wellfield is 450 feet. Each well has yielded promising volumes of water during each testing phase. UEC is adding gaseous oxygen and carbon dioxide to the circulating ground water, which has activated the mining process of dissolving the uranium from surrounding sandstones.

Phases II and III of the PAA-1 wellfield will each contain 45 production and injection wells. To date, all Phase II wells have been completed, and are targeted to commence mining this year. UEC has begun installation of Phase III wells with three rigs actively casing and then completing each well.

Additionally, UEC’s permitting and development teams are working towards bringing Palangana’s Production Area 2 closer to production. UEC’s exploration group commenced a drilling program during the third quarter consisting of approximately 50 holes at the proposed Production Area 3 wellfield. Resource expansion efforts are continuing in other areas at Palangana.

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