<PAGE>

                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                          AMENDMENT NO. 2 TO FORM 20-F

  [ ] REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR (g) OF THE SECURITIES
                              EXCHANGE ACT OF 1934.
                                       OR
       [X] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
                              EXCHANGE ACT OF 1934.

                  For the fiscal year ended September 30, 2000

                                       OR

     [ ] TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
                              EXCHANGE ACT OF 1934.

           or the transition period from ____________ to ___________

                         Commission File Number: 0-24443

                        INTERNATIONAL URANIUM CORPORATION
               (Exact name of Company as specified in its charter)

                                 ONTARIO, CANADA
                 (Jurisdiction of incorporation or organization)

    INDEPENDENCE PLAZA, SUITE 950, 1050 SEVENTEENTH STREET, DENVER, CO 80265
                    (Address of principal executive offices)

 Securities registered or to be registered pursuant to Section 12(b) of the Act:
                                      NONE

 Securities registered or to be registered pursuant to Section 12(g) of the Act:

                         COMMON STOCK WITHOUT PAR VALUE
                                (Title of Class)

        Securities for which there is a reporting obligation pursuant to
                            Section 15(d) of the Act:
                                      NONE

Indicate the number of outstanding shares of each of the Company's classes of
capital or common stock as of the close of the period covered by the annual
report:

<Table>
<Caption>
                                                ISSUED AND OUTSTANDING
                 TITLE OF CLASS                AS OF SEPTEMBER 30, 2000
                 --------------                ------------------------
<S>                                           <C>

        Common Stock, Without Par Value        65,525,066 common shares
</Table>

Indicate by check mark whether the Company (1) has filed all reports required to
be filed during the preceding 12 months (or shorter period that the Company was
required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days.

YES        X              NO
      -----------             -----------

Indicate by check mark which financial statement item the Company has elected to
follow:

ITEM 17      X             ITEM 18
        -----------                -----------


<PAGE>


SPECIAL NOTE REGARDING FORWARD LOOKING STATEMENTS

Except for the statements of historical fact contained therein, the information
under the headings "Item 4 - "Information on the Company," "Item 5 - "Operating
and Financial Review and Prospects," "Item 11 - Quantitative and Qualitative
Disclosure About Market Risk," and elsewhere in this Form 20-F constitutes
forward looking statements ("Forward Looking Statements") within the meaning of
Section 27A of the Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended. Such Forward Looking Statements
involve known and unknown risks, uncertainties and other factors which may cause
the actual results, performance or achievements of the Company to differ
materially from any future results, performance or achievements projected or
implied by such Forward Looking Statements. Such factors include, among others,
the ability of the Company to develop the alternate feed business, dependence on
a limited number of customers, limited operating history, government regulation
and policy risks, environmental risks, reclamation obligations and the other
factors set forth in the section entitled "Risk Factors".


                                GLOSSARY OF TERMS

ALTERNATE FEED             Ore or residues from other processing facilities that
                           contain uranium in quantities or forms that are
                           either uneconomic to recover or cannot be recovered
                           at these other facilities, but can be recovered
                           either alone or in conjunction with other co-products
                           at the Company's facilities;

BLM                        Means the United States Department of Interior Bureau
                           of Land Management;

CCD CIRCUIT                The counter-current decantation circuit at the White
                           Mesa Mill, in which uranium-bearing solution is
                           separated from the crushed waste solids;

CONVERSION                 A process whereby the purified uranium obtained in
                           the refining process is converted into forms suitable
                           for making nuclear fuel (UO2) or for enrichment
                           (UF6);

$                          Means United States dollars and "CDN $" means
                           Canadian dollars;

ENRICHMENT                 A process whereby the U-235 isotope content is
                           increased from the natural level of 0.711% to a
                           concentration of 3% to 5% as required in fuel for
                           light water reactors;

EPA                        The United States Environmental Protection Agency;

FEE LAND                   Means private land;

HECTARE                    Measurement of an area of land equivalent to 10,000
                           square meters or 2.47 acres;

ISL OR IN SITU LEACH       In situ leach mining means solution mining that is
                           performed in the mineralized horizons and does not
                           involve excavation and removal of mineralized rock or
                           the subsequent processing of such rock through a mill
                           to recover uranium. Rather, the mineralized material
                           is mined by using groupings of wells completed in the
                           mineralized horizons to inject leach solution, which
                           is recovered in production wells. The leaching
                           solution selectively dissolves the uranium
                           mineralization, and the solution is then processed to
                           recover the contained uranium.

MINERALIZATION             Means a natural aggregate of one or more metallic
                           minerals;


                                       2
<PAGE>


MINERAL DEPOSIT OR
MINERALIZED MATERIAL       Is a mineralized body which has been delineated by
                           appropriately spaced drilling and/or underground
                           sampling to support a sufficient tonnage and average
                           grade of metal(s). Such a deposit does not qualify as
                           a reserve until a comprehensive evaluation based upon
                           unit cost, grade, recoveries, and other material
                           factors conclude legal and economic feasibility.

NRC                        The United States Nuclear Regulatory Commission;

PARTIALLY DEVELOPED        With respect to properties, means properties that
                           contain workings from previously operating mines that
                           were shut down due to a lack of economic feasibility
                           of the mineralized material left in the stopes.

REFINING                   A process whereby yellowcake is chemically refined to
                           separate the uranium from impurities to produce
                           purified uranium;

RESERVE                    That part of a mineral deposit which could be
                           economically and legally extracted or produced at the
                           time of the reserve determination.

SAG MILL                   The semi-autogenous grinding mill at the White Mesa
                           Mill in which the uranium ore is ground prior to the
                           leaching process;

TAILINGS                   Waste material from a mineral processing mill after
                           the metals and minerals of a commercial nature have
                           been extracted;

TON                        A short ton (2,000 pounds);

TONNE                      A metric tonne (2,204.6 pounds);

URANIUM OR U               Means natural uranium; 1% U=1.18% U3O8;

UF6                        Means natural uranium hexafluoride, produced by
                           conversion from U3O8 , which is not yet enriched or
                           depleted;

U3O8                       Triuranium octoxide;

V2O5                       Vanadium pentoxide;

WHITE MESA MILL            Means the 2,000 ton per day uranium mill, with a
                           vanadium or other co-product recovery circuit,
                           located near Blanding, Utah that is owned by the
                           Company's subsidiary IUC White Mesa, LLC. Also
                           referred to as the "Mill".

YELLOWCAKE                 Means the concentrate powder produced from uranium
                           milling, or an in situ leach, facility. Yellowcake
                           typically contains approximately 90% U3O8 from
                           conventional mined ores.


                                     PART I


ITEM 1. IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS

Not Applicable.



                                       3
<PAGE>



ITEM 2. OFFER STATISTICS AND EXPECTED TIMETABLE

Not Applicable.

ITEM 3. KEY INFORMATION


A. SELECTED FINANCIAL DATA

The following table sets forth selected consolidated financial data of
International Uranium Corporation (the "Company" or "IUC") for the periods ended
September 30, 2000, 1999, 1998 and 1997, and was prepared in accordance with
Canadian generally accepted accounting principles ("Canadian GAAP"). The table
also summarizes certain corresponding information prepared in accordance with
United States generally accepted accounting principles ("U.S. GAAP"). This
selected consolidated financial data includes the accounts of the Company and
its subsidiaries. All amounts stated are in United States dollars:


                             SELECTED FINANCIAL DATA

<Table>
<Caption>
                                                                                                    PERIOD FROM
                                      FISCAL YEAR ENDED   FISCAL YEAR ENDED  FISCAL YEAR ENDED     INCORPORATION
                                         SEPTEMBER 30        SEPTEMBER 30      SEPTEMBER 30     OCTOBER 3, 1996, TO
                                            2000                1999               1998          SEPTEMBER 30, 1997
                                      -----------------   -----------------  -----------------  -------------------
<S>                                   <C>                <C>                <C>                <C>

 Revenues                                $ 16,060,172       $ 14,046,832       $ 32,940,876       $    523,865

 Net income (loss)
      Canadian GAAP                      $(15,244,651)      $(17,097,677)      $  1,617,331       $     18,694

      US GAAP                            $ (4,552,890)      $(21,290,100)      $ (2,349,312)      $ (1,674,797)

 Basic/diluted income (loss) per
equity share
      Canadian GAAP                      $      (0.23)      $      (0.26)      $       0.02       $         --
      US GAAP                            $      (0.07)      $      (0.32)      $      (0.04)      $      (0.04)
 Total assets
      Canadian GAAP                      $ 33,152,084       $ 45,891,809       $ 54,770,714       $ 57,200,339
      US GAAP                            $ 33,175,318       $ 35,223,282       $ 48,294,610       $ 54,690,878

Net Assets
      Canadian GAAP                      $  6,733,099       $ 21,977,750       $ 39,075,427       $ 37,532,691
      US GAAP                            $  6,756,333       $ 11,309,223       $ 32,599,323       $ 35,023,230

Capital stock
      Canadian GAAP                      $ 37,439,402       $ 37,439,402       $ 37,439,402       $ 37,513,997
      US GAAP                            $ 36,623,432       $ 36,623,432       $ 36,623,432       $ 36,698,027

Number of shares outstanding
                                           65,525,066         65,525,066         65,525,066         65,743,066

Dividends declared                       $         --       $         --       $         --       $         --
</Table>


B. CAPITALIZATION AND INDEBTEDNESS

Not Applicable.



                                       4
<PAGE>


C. REASONS FOR THE OFFER AND USE OF PROCEEDS

Not Applicable.


D. RISK FACTORS

The following risk factors should be considered in connection with any
investment in the Company.

ABILITY TO DEVELOP ALTERNATE FEED BUSINESS

The Company intends to marshal its resources and concentrate its operations on
the continuing development of the alternate feed, uranium-bearing waste
recycling business. In order for the Company to become profitable in this
business the Company must be able to: A) identify a sufficient number of
contracts that would be profitable for the Company; B) be successful in winning
a sufficient number of these contracts in the face of competition from other
facilities; and C) receive these contracts in a time frame and have sufficient
backlog of such contracts to allow the Mill to operate at a sufficient capacity
to more than cover its costs of production, any standby costs that are incurred
between Mill runs, and other corporate overheads. While the Company has had
considerable success to date in this initiative, the Company has not to date
developed a sufficient backlog of alternate feed business to result in sustained
profitable operations for the Company. Developing this backlog will be a
prerequisite if the Company is to continue with its pursuit of this business in
the future. There can be no guarantee or assurance that the Company will be
successful in developing the necessary backlog or that it will otherwise be
successful at this business initiative. If the Company cannot develop this
backlog in the near future, it may pursue other business opportunities, as they
may arise.

ABILITY TO SUCCESSFULLY PURSUE OTHER BUSINESS INITIATIVES

If the Company is unsuccessful in developing the alternate feed, uranium-bearing
waste recycling business, it may pursue other business opportunities, as they
may arise, in lieu thereof. In addition, the Company will continue to evaluate
other opportunities, as they arise, unrelated to its mining and alternate feed
activities. There can be no guarantee or assurance that the Company has or will
be able to develop the required expertise or experience for any such other
business opportunities or that any such other business opportunities will be
successful.

ENVIRONMENTAL RISKS

The Company is required to comply with environmental protection laws and
regulations and permitting requirements, and the Company anticipates that it
will be required to continue to do so in the future. The material laws and
regulations that the Company must comply with are the Atomic Energy Act, Uranium
Mill Tailings Radiation Control Act of 1978 ("UMTRCA"), Clean Air Act, Clean
Water Act, Safe Drinking Water Act, National Environmental Policy Act ("NEPA"),
Federal Land Policy Management Act, National Park System Mining Regulations Act,
and the State Mined Land Reclamation Acts or Department of Environmental Quality
regulations, as applicable. The Company complies with the Atomic Energy Act as
amended by UMTRCA by applying for and maintaining an operating license from the
NRC. Uranium milling operations must conform to the terms of such licenses,
which include provisions for protection of human health and the environment from
endangerment due to radioactive materials. The licenses encompass protective
measures consistent with the Clean Air Act and the Clean Water Act, and as
federally-issued licenses, are subject to the provisions of NEPA. This means
that any significant action relative to issuance, renewal, or amendment of the
license must meet the NEPA provisions. At the present time, the NRC also
regulates in situ uranium mining operations. Therefore, for these types of
facilities, the Company must comply with the NRC licensing requirements, as well
as with the Federal Land Policy Management Act, the National Park System Mining
Regulations Act, and State Mined Land Reclamation Acts or Department of
Environmental Quality regulations, as applicable. The Company utilizes specific
employees and consultants in order to comply with and maintain the Company's
compliance with the above laws and regulations.

Although the Company believes that its operations are in compliance, in all
material respects, with all relevant permits, licenses and regulations involving
worker health and safety as well as the environment, the historical trend toward
stricter environmental regulation may continue. The uranium industry is subject
to not only the worker health and safety and environmental risks associated with
all mining businesses, but also to additional risks uniquely associated with
uranium mining and milling. The possibility of more stringent regulations exists
in the areas of


                                       5
<PAGE>


worker health and safety, the disposition of wastes, the decommissioning and
reclamation of mining and milling sites, and other environmental matters, each
of which could have a material adverse effect on the costs or the viability of a
particular project.

The Company has detected some chloroform contamination at the Mill site, that
appears to have resulted from the operation of a temporary laboratory facility
that was located at the site prior to and during construction of the Mill
facility. See "Item 8. Financial Information - Legal Proceedings." The source
and extent of this contamination are currently under investigation, and a
corrective action plan, if necessary, is yet to be devised. Although
investigations to date indicate that this contamination appears to be contained
in a manageable area, the scope and costs of remediation have not yet been
determined and could be significant.

RECLAMATION OBLIGATIONS

As owner and operator of the White Mesa Mill and numerous uranium and
uranium/vanadium mines, the Company is obligated to eventually reclaim such
properties. Most but not all of these reclamation obligations are bonded, and
cash and other assets of the Company have been reserved to secure a portion of
this bonded amount. Although the Company's financial statements contain as a
liability the Company's current estimate of the cost of performing these
reclamation obligations, and the bonding requirements are generally periodically
reviewed by applicable regulatory authorities, there can be no assurance or
guarantee that the ultimate cost of such reclamation obligations will not exceed
the estimated liability contained on the Company's financial statements. In
addition, effective January 20, 2001, the BLM implemented new Surface Management
(3809) Regulations pertaining to mining operations conducted on mining claims on
public lands. The new Regulations impose significant requirements on permitting
of operations and on plans for reclamation and closure of mining operations on
public lands. Although the new Regulations are being challenged by industry, the
Regulations could ultimately impose new requirements on those properties held by
the Company under mining claims. Such new requirements could increase the amount
of reclamation bonds held by the Company and could also impose more onerous and
costly operation and reclamation conditions. On March 23, 2001, the BLM
published a proposal to suspend the 3890 regulations pending public comment. See
"Item 4. Information on the Company - Reclamation."

DEPENDENCE ON LIMITED NUMBER OF CUSTOMERS

The Company's main alternate feed contracts to date have come from, and future
contracts are expected to come from, a limited number of government and private
sources. The loss of any of the Company's customers could have a material
adverse effect on the Company's financial performance. Factors which may affect
the Company's clients include change in government policies and the availability
of government financing, variation in environmental regulations and competition
from direct disposal and other competitors. The loss of any of the Company's
largest customers or curtailment of purchases of recycling services by such
customers along with the inability to replace such customers with new customers
could have a material adverse effect on the Company's financial condition and
results from operations.

RELIANCE ON ALTERNATE FEED INCOME; DEPENDENCE ON ISSUANCE OF LICENSE AMENDMENTS

A significant portion of the Company's expected revenues and income over the
next several years is expected to result from the processing of alternate feed
materials through the White Mesa Mill. The Company's ability to process
alternate feeds is dependent upon obtaining amendments to its Mill license from
the NRC. There can be no assurance that the NRC will continue to issue such
license amendments. See "Item 4. Information on the Company - Alternate Feed
Processing" and "Item 8. Financial Information - Legal Proceedings."

Although the Company believes that alternate feed sources will continue to
generate income for the Company in the foreseeable future, there can be no
guarantees or assurance that this will be the case.

DEPENDENCE ON KEY PERSONNEL

The Company's success will largely depend on the efforts and abilities of
certain senior officers and key employees. Certain of these individuals have
significant experience in the uranium and radioactive waste recycle/disposal
industry. The number of individuals with significant experience in this industry
is small. While the Company does not foresee any reason why such officers and
key employees will not remain with the Company, if for any reason


                                       6
<PAGE>


they do not, the Company could be adversely affected. The Company has not
purchased key man life insurance for any of these individuals.

LIMITED OPERATING HISTORY

The Company began its business in May 1997, following the acquisition of assets
from the Energy Fuels group of companies (See "Item 4: History and Development
of the Company - Description of Business"). As a result, the Company has had a
limited history of operations, and has not been profitable in recent years.
There can be no assurance that the Company's operations will be profitable.

LIQUIDITY OF TRADING MARKET FOR THE COMPANY'S SHARES

Although the Company's shares are listed on The Toronto Stock Exchange, the
volume of shares traded at any one time can be limited, and, as a result, at any
point in time there may not be a liquid trading market for the shares.

VOLATILITY AND SENSITIVITY TO PRICES, COSTS AND EXCHANGE RATES

Because a significant portion of the Company's revenues have been derived from
the sale of uranium and vanadium in the past, the Company's net earnings can be
affected by the long- and short-term market price of U3O8 and V2O5.
Historically, uranium prices have been subject to fluctuation, and the price of
uranium has been and will continue to be affected by numerous factors beyond the
Company's control, such as demand for nuclear power, political and economic
conditions in uranium producing and consuming countries, such as the United
States, Canada and Russia and other republics of the CIS, and production levels
and costs of production in countries such as Australia, Canada and other
republics of the former CIS.

During fiscal year 2000, U3O8 prices started at $9.75 per pound U3O8 in
September 1999, then declined to $7.40 per pound in September 2000. The spot
market value of vanadium, declined from $1.84 per pound of V2O5 in September
1999 to a low of $1.29 per pound in December 1999, rising to $2.25 per pound
during the period from March to May 2000 and then declining to $1.70 by fiscal
year end. Uranium prices continued to drift downward to $7.10 per pound in
January 2001 but have risen to $8.20 by the end of March 2001. Vanadium prices
have declined further to approximately $1.45 per pound as of March 2001.

GOVERNMENTAL REGULATION AND POLICY RISKS

Mining and milling operations and exploration activities, particularly uranium
mining and milling in the United States, and alternate feed processing
activities, are subject to extensive regulation by state and federal
governments. Such regulation relates to production, development, exploration,
exports, taxes and royalties, labor standards, occupational health, waste
disposal, protection and remediation of the environment, mine and mill
reclamation, mine and mill safety, toxic substances and other matters.
Compliance with such laws and regulations has increased the costs of exploring,
drilling, developing, constructing, operating and closing the Company's mill,
mines and other facilities. It is possible that, in the future, the costs,
delays and other effects associated with such laws and regulations may have an
impact on the Company's decisions as to whether to operate the Mill, existing
mines and other facilities or, with respect to exploration and development
properties, whether to proceed with exploration or development. Furthermore,
future changes in governments, regulations and policies, could materially
adversely affect the Company's results of operations in a particular period or
its long-term business prospects.

Worldwide demand for uranium is directly tied to the demand for energy produced
by the nuclear electric industry, which is also subject to extensive government
regulation and policies in the United States and elsewhere. The development of
mines and related facilities is contingent upon governmental approvals which are
complex and time consuming to obtain and which, depending upon the location of
the project, involve various governmental agencies. The duration and success of
such approvals are subject to many variables outside the Company's control. In
addition, the international marketing of uranium is subject to governmental
policies and certain trade restrictions, such as those imposed by the suspension
agreements entered into by the United States with certain republics of the
former CIS and the agreement between the United States and Russia related to the
supply of Russian HEU into the United States.


                                       7
<PAGE>


URANIUM INDUSTRY COMPETITION AND INTERNATIONAL TRADE RESTRICTIONS

The international uranium industry is highly competitive in many respects,
including the supply of uranium. The Company markets uranium to utilities in
direct competition with supplies available from a relatively small number of
Western World uranium mining companies, from certain republics of the former CIS
and mainland China and from excess inventories, including inventories made
available from decommissioning of military weapons. To some extent, the effects
of the supply of uranium from the former CIS republics are mitigated by a number
of international trade agreements and policies, including suspension agreements
entered into by the United States with certain republics of the former CIS,
including Russia, that restrict imports into the United States market. In
addition, in January 1994, the United States and Russia signed a 20-year
agreement to convert HEU from former Russian nuclear weapons to a grade suitable
for use in nuclear power plants. During 1995, the United States also amended its
suspension agreements with the Republics of Kazakhstan and Uzbekistan, which
increased the limit on the supply of uranium from those republics into the
United States for a 10-year period. The European Community also has an informal
policy limiting annual consumption of uranium sourced from the former CIS
republics. These agreements and any similar future agreements, governmental
policies or trade restrictions are beyond the control of the Company and may
affect the supply of uranium available in the United States, which is the
largest market for uranium in the world.

IMPRECISION OF MINERAL DEPOSIT ESTIMATES

Mineral deposit estimates included in this document for uranium and vanadium are
estimates, and no assurances can be given that the indicated levels of recovery
will be realized. Such estimates are expressions of judgment based on knowledge,
mining experience, and analysis of drilling results and industry practices.
Valid estimates made at a given time may significantly change when new
information becomes available. While the Company believes that the mineral
deposit estimates included in this document are well established and reflect
management's best estimates, by their nature, mineral deposit estimates are
imprecise and depend, to a certain extent, upon statistical inferences which may
ultimately prove unreliable. Furthermore, based on current commodity prices,
none of the Company's mineral deposits are considered reserves, and there can be
no assurances that any of such deposits will ever be reclassified as reserves.
Mineral deposit figures included here have not been adjusted in consideration of
these risks and, therefore, no assurances can be given that any mineral deposit
estimate will ultimately be reclassified as reserves.

MINING AND MILLING RISKS AND INSURANCE

The mining and milling of uranium and uranium-bearing materials is a capital
intensive commodity business, and is subject to a number of risks and hazards.
These risks are environmental pollution, accidents or spills, industrial
accidents, labor disputes, changes in the regulatory environment, natural
phenomena (such as inclement weather conditions, underground flooding and
earthquakes), and encountering unusual or unexpected geological conditions.
Depending on the size and extent of the event, the foregoing risks and hazards
could result in damage to, or destruction of, the Company's mineral properties,
personal injury or death, environmental damage, delays in or cessation of
production from the Company's Mill, mines or in its exploration or development
activities, monetary losses, cost increases which could make the Company
uncompetitive, and potential legal liability. In addition, due to the
radioactive nature of the materials handled in uranium mining and milling,
additional costs are incurred by the Company on a regular and ongoing basis.

The Company maintains insurance against certain risks that are typical in the
uranium industry. As of March 30, 2001, this includes approximately $53,000,000
of fire and casualty insurance for damage to the White Mesa Mill and mining
properties, $3,000,000 of business interruption insurance for the White Mesa
Mill caused by fire or other insured casualty, and $13,000,000 of general
liability insurance. Although the Company maintains insurance in amounts it
believes to be reasonable, such insurance may not provide adequate coverage in
the event of certain unforeseen circumstances. Insurance against certain risks
(including certain liabilities for environmental pollution or other hazards as a
result of production, development or exploration), is generally not available to
the Company or to other companies within the uranium mining and milling
business.

CONFLICTS OF INTEREST

Certain of the directors of the Company also serve as directors of other
companies involved in natural resource exploration and development, and
consequently there exists the possibility for such directors to be in a position
of


                                       8
<PAGE>


conflict. Any decision made by such directors involving the Company will be made
in accordance with the duties and obligations of directors to deal fairly and in
good faith with the Company and such other companies. In addition, such
directors must declare, and refrain from voting on, any matter in which such
directors may have a conflict of interest. The Company believes that no material
conflicts of interest currently exist. See "Item 7. Major Shareholders and
Related Party Transactions - Related Party Transactions" and "Item 6. Directors
Senior Management and Employees - Board Practices."

ITEM 4. INFORMATION ON THE COMPANY


A. HISTORY AND DEVELOPMENT OF THE COMPANY

                             DESCRIPTION OF BUSINESS

The Company is in the business of recycling uranium-bearing waste products at
its White Mesa uranium mill as an alternative to the direct disposal of these
waste products. In addition, the Company is engaged in the selling of uranium
recovered from these operations. The Company also sells vanadium and other
metals that can be produced as a co-product with uranium. The Company continues
to own several uranium and uranium/vanadium mines and exploration properties
that have been shut down pending any significant improvements in commodity
prices. See "Current Operations".

The Company is the product of an amalgamation under the Business Corporations
Act (Ontario) (the "Act") of two companies; namely, International Uranium
Corporation, incorporated on October 3, 1996 under the laws of the Province of
Ontario pursuant to the Act, and Thornbury Capital Corporation, incorporated
under the laws of the Province of Ontario by Letters Patent ("Thornbury") on
September 29, 1950. The amalgamation was made effective on May 9, 1997, pursuant
to a Certificate of Amalgamation dated that date. The amalgamated companies were
continued under the name "International Uranium Corporation." See
"Amalgamation." The Company operates under the Act.

The head office of the Company is located at Independence Plaza, Suite 950, 1050
Seventeenth Street, Denver, CO 80265, telephone number 303-628-7798. The
registered office of the Company is located at Suite 2100, Scotia Plaza, 40 King
Street West, Toronto, Ontario, M5H 3C2, telephone number 416-869-5300.

The Company entered the uranium industry in May 1997 by acquiring substantially
all of the uranium producing assets of Energy Fuels Ltd., Energy Fuels
Exploration Company, and Energy Fuels Nuclear, Inc. (collectively "Energy
Fuels"). The Company raised Cdn$47.25 million through a special warrant private
placement and used cash of approximately Cdn$29.3 million ($20.5 million) to
purchase the Energy Fuels' assets (see "Acquisition" for further details).
Energy Fuels was a uranium producer with properties in the United States and
Mongolia.

The Energy Fuels' assets acquired included several developed mines that were
shut down, several partially developed properties and exploration properties
within the states of Colorado, Utah, Arizona, Wyoming and South Dakota, as well
as the 2,000 ton per day White Mesa Mill near Blanding, Utah. The White Mesa
Mill is a fully permitted dual circuit uranium/vanadium mill. In addition to the
U.S. properties, the Company also acquired a 70% interest in a joint venture
with the government of Mongolia and a Russian geological concern to explore for
economic uranium mineralization in Mongolia.

Due to deteriorating commodity prices and other factors, the Company has ceased
its mining and exploration activities, and has shut down all of its mines and
its Mongolian joint venture. The Company intends to keep those properties on a
shut down status indefinitely, pending any significant improvements in commodity
prices, or possibly sell or joint venture all or a portion of such properties
and interest to or with other parties. The Company has closed its Colorado
Plateau and Arizona mining offices. See "Current Operations."

While this reduction in exploration and mining activities is underway, the
Company is concentrating its United States operations on the continuing
development of the alternate feed, uranium-bearing waste recycling business,
including the possibility of joint venturing or selling all or a portion of this
business with or to other parties. See "Alternate Feed Processing." The Company
will also continue to evaluate other opportunities, as they arise, unrelated to
its mining and alternate feed activities.


                                       9
<PAGE>


                                  AMALGAMATION

The predecessor, International Uranium Corporation ("Old IUC"), and Thornbury
were amalgamated effective May 9, 1997 under the provisions of the Business
Corporations Act (Ontario) to form the Company in accordance with the terms of
an agreement entered into between Old IUC and Thornbury dated February 13, 1997
(the "Amalgamation Agreement"). The primary purpose of the Amalgamation was to
effect an acquisition of Thornbury by Old IUC in that upon completion of the
Amalgamation the shareholders of Old IUC immediately prior to the Amalgamation
would hold the controlling interest in the Company, a public company.

BACKGROUND ON THORNBURY

Thornbury was incorporated under the laws of Ontario on September 29, 1950.
Thornbury's common shares were quoted for trading on the Canadian Dealing
Network Inc. Thornbury's principal assets consisted of marketable securities
with a market value as at December 31, 1996 of Cdn$495,480 and eight mining
claims situated in the Mayo Mining District, Yukon Territory, which expire
between 1999 and 2009.

SHARE EXCHANGE RATIOS

The Amalgamation received the approval of the shareholders of both Old IUC and
Thornbury. On amalgamation, each shareholder of Old IUC received one (1) share
of the Company, a newly formed amalgamated company, for each one (1) common
share held in Old IUC, and each shareholder of Thornbury received one (1) share
of the Company for each five (5) common shares held in Thornbury. Fractional
shares resulting from the foregoing were rounded down to the next whole number.

After giving effect to the amalgamation, there were a total of 65,743,066 common
shares of the Company issued and outstanding. This figure was based on
26,500,000 previously issued common shares of Old IUC, 37,800,000 common shares
of Old IUC issued upon conversion of the special warrants and 7,215,334 common
shares of Thornbury which were outstanding prior to the amalgamation being
effective (1,443,066 post-amalgamation common shares).

AMALGAMATION AGREEMENT

Old IUC and Thornbury entered into an amalgamation agreement, which contained
such representations and warranties, covenants, indemnification and other
provisions as are customarily found in an amalgamation agreement entered into by
parties dealing at arm's length.

                                   ACQUISITION

The Company entered the uranium industry by acquiring substantially all of the
uranium producing assets of Energy Fuels. On December 19, 1996, Old IUC, through
its subsidiary, International Uranium Holdings Corporation, entered into an
agreement (the "Acquisition Agreement") to acquire the Energy Fuels' Assets for
cash of $20.5 million, subject to adjustment. The terms of the acquisition were
approved by the United States Bankruptcy Court following a lengthy bidding
procedure as required under United States bankruptcy laws. See "Bankruptcy of
Oren Benton and Nuexco." The acquisition was completed on May 9, 1997.

                                  ENERGY FUELS

HISTORICAL BACKGROUND

The Energy Fuels group of companies was founded in August 1976 to capitalize on
uranium mining, purchasing and processing opportunities in the Colorado Plateau
area of western Colorado and eastern Utah.

In order to process the ores mined and purchased from the Colorado Plateau,
Energy Fuels commenced construction of a 2,000 ton per day mill near Blanding,
Utah in June 1979 at a total cost of approximately $40 million. Known as the
White Mesa Mill, the facility is a dual-circuit uranium mill.

The cost of construction of the White Mesa Mill was funded in large part by
Kernkraftwerk Goesgen-Daeniken AG, and Nordostschweizerische Kraftwerke AG (the
"Swiss Utilities"), the former limited partners in certain of the


                                       10
<PAGE>


Energy Fuels Assets, who owned a 40% limited partnership interest in almost all
of Energy Fuels' United States assets. In 1995, this 40% limited partnership
interest was converted into a 9% royalty on all uranium produced and a 5%
royalty on vanadium and all other minerals produced from the United States
properties. This royalty was reduced in 1997 and terminated in fiscal 2000. See
"Swiss Royalty Interest".

In the early 1980s Energy Fuels expanded its operations to include breccia pipe
uranium mining in the Arizona Strip district of northern Arizona. The land
position of Energy Fuels in the Arizona Strip district acquired by the Company
included four developed or partially developed properties as well as several
potential prospects and numerous other exploration targets.

In 1984, Energy Fuels formed a limited partnership with Union Carbide
Corporation ("Union Carbide") pursuant to which Union Carbide acquired a 70%
undivided interest in and became the operator of the White Mesa Mill. As a
result of subsequent negotiations in 1987, Union Carbide's mines and properties
in the Colorado Plateau were added to this limited partnership and, as a result,
Energy Fuels acquired a 25% undivided interest in those mines. In 1994 this
partnership was dissolved and Energy Fuels re-acquired 100% of the White Mesa
Mill as well as certain of Union Carbide's mines on the Colorado Plateau. In the
Colorado Plateau district, Energy Fuels then owned several uranium and vanadium
mines that were shut down, several partially developed properties as well as
additional acreage with exploration potential.

In 1994, in an effort to expand into the global uranium marketplace, Energy
Fuels acquired a 70% interest in a joint venture with the government of Mongolia
and a Russian geological concern to explore for economic uranium mineralization
in Mongolia.

In the early 1990s, Energy Fuels also acquired two uranium properties intended
to be mined by in situ type mining technology: the Reno Creek property in
Wyoming, and the Dewey Burdock property in South Dakota.

In early 1995, Energy Fuels filed for protection under Chapter 11 of the United
States Bankruptcy Code as a result of providing guarantees to an affiliated
company and its majority shareholder. See "Bankruptcy of Oren Benton and
Nuexco".

BANKRUPTCY OF OREN BENTON AND NUEXCO

On February 23, 1995, Oren L. Benton ("Benton") and two entities which Benton
controlled -- Nuexco Trading Corporation ("Nuexco") and CSI Enterprises, Inc.
("CSI") -- filed for protection under Chapter 11 of the United States Bankruptcy
Code.

Energy Fuels, Ltd. ("EFL") and Energy Fuels Exploration Company ("EFEX") also
filed for protection under Chapter 11 of the United States Bankruptcy Code on
February 23, 1995. EFL and EFEX were both controlled by Benton through the
Energy Fuels Mining Joint Venture ("EFMJV"). EFL and EFEX were forced into
bankruptcy because Benton, as controlling shareholder, caused them to guarantee
certain of Benton's and Nuexco's investment and trading activities. EFMJV filed
for protection under Chapter 11 on August 12, 1996.

The bankruptcy of Benton, Nuexco, CSI, EFL, EFEX and EFMJV involved numerous
other affiliated and subsidiary entities, of which Energy Fuels was a relatively
small part.

Under the provisions of Chapter 11 of the United States Bankruptcy Code, Benton
maintained control of the assets of his estate, including the Energy Fuels
Assets, but was under a fiduciary duty to reorganize his estate either under a
plan of reorganization or through the sale of portions of the assets from time
to time ("Section 363 Sales"). In order to protect the rights of creditors in
this process, a committee of selected creditors was formed (the "Creditors
Committee") as required under the provisions of Chapter 11 of the United States
Bankruptcy Code.

Benton and the Creditors Committee filed a joint Section 363 Sale motion on
October 21, 1996 with the Company as the lead bidder for the sale of the Energy
Fuels Assets to the Company for cash of $20.5 million, subject to adjustments.

On December 4, 1996, the Bankruptcy Court approved the Acquisition Agreement and
the sale of the Energy Fuels Assets to the Company. The effect of the court
order was to eliminate substantially all known and existing claims


                                       11
<PAGE>


and liabilities of all creditors against the Energy Fuels Assets, so that the
Company would acquire the Energy Fuels Assets free and clear of all such
liabilities.

             SUMMARY OF ENERGY FUELS ASSETS ACQUIRED BY THE COMPANY

UNITED STATES ASSETS

The Energy Fuels Assets acquired by the Company pursuant to the Acquisition
Agreement located in the United States included the following:

          o    the White Mesa Mill, a 2,000 ton per day uranium and vanadium
               processing plant near Blanding, Utah. See "White Mesa Mill."

          o    the Arizona Strip uranium properties, in north central Arizona.
               See "Arizona Strip."

          o    the Colorado Plateau uranium properties, straddling the
               south/central Colorado and Utah border. See "Colorado Plateau
               District."

          o    the Reno Creek in situ leach project, a uranium deposit in the
               Powder River Basin area of Wyoming. See "Other U.S. Mineral
               Properties."

          o    the Dewey Burdock in situ leach project, a uranium deposit in
               South Dakota which has since been dropped by the Company. See
               "Other U.S. Mineral Properties."

          o    the Bullfrog project, a uranium deposit in south central Utah.
               See "Other U.S. Mineral Properties."

          o    mining equipment. See "Other Assets of Company."

          o    various uranium supply, waste processing contracts, and joint
               venture contracts. See "Other Assets of Company."

          o    various field and administrative offices. See "Other Assets of
               Company."

THE MONGOLIA PROPERTY

Energy Fuels owned a 70% interest in the Gurvan-Saihan Joint Venture in
Mongolia. The Company, as a result of the Acquisition, acquired this interest.
The other parties are the Mongolian Government as to 15% and Geologorazvedka, a
Russian geological concern, as to the remaining 15%. As of March 30, 2001, The
Gurvan-Saihan Joint Venture holds some 3.19 million acres of uranium exploration
properties in Mongolia. See "Mongolia Property."

PRINCIPAL CAPITAL EXPENDITURES AND DIVESTITURES

The Company's principal capital expenditures during the last three fiscal years
have been $4,454,416 for its Mongolian mineral properties and $6,114,691 for its
U.S. operations. During this same time period the Company sold approximately
$1,052,000 of surplus mining equipment, resulting in a gain of $263,331. In
addition, due to a significant deterioration in the market price for uranium and
vanadium, the Company has written off its entire investment in its Mongolian
joint venture and its U.S. mining properties. The Company expects to finance the
development of the alternate feed business, which is the Company's current
focus, through internal sources.

                          HISTORY OF MINING OPERATIONS

The Company commenced conventional mining operations at its Sunday Mine Complex
in November 1997 and at its Rim Mine in January 1998 after completion of minor
development activities. These properties are located in the Colorado Plateau
District of western Colorado and eastern Utah, and contain high grades of
vanadium along with uranium.


                                       12
<PAGE>


To supplement its own production, the Company implemented a mill-feed purchase
program under which it intended to purchase feed for the Mill from many small
independent mines in the Uravan district of the Colorado Plateau mining region.
Unfortunately, this program did not materialize to the degree hoped, as the
independent miners found that their operations were not economic at then current
commodity prices, due to new regulatory and environmental licensing requirements
that had come into effect since they last operated.

The Company continued the mining of uranium and vanadium-bearing material from
its Sunday and Rim Mine complexes in the Colorado Plateau district until
mid-1999. At that time, the Company elected to suspend mining operations as a
result of continued weak uranium and vanadium prices and the expectation that
these conditions would not improve for the next several years. The shut down of
the mines took several months to complete, and the process of putting the mines
on standby was completed in November 1999. Due principally to the lack of
success of the Company's mill-feed purchase program, the tonnage ultimately
delivered to the Mill was less than originally expected. Approximately 87,250
tons of material, with a U3O8 grade of 0.28% and a V2O5 grade of 1.9% were mined
from the Company's mines and independent mines. All of the material was shipped
to the White Mesa Mill, and the Company commenced the milling of this material
in June, 1999. The conventional mill run was much shorter than originally
anticipated, which impacted operating efficiencies and, ultimately, unit
production costs. In addition, certain operational problems were encountered
with the vanadium circuit which had not operated since 1990, resulting in lower
realized recoveries. Nevertheless, the milling of the material was completed in
October of 1999 and the Company recovered approximately 487,000 pounds of U3O8
concentrates and approximately 2.0 million pounds of vanadium.

Due to deteriorating commodity prices and other factors, the Company placed all
of its U.S. mines on standby in fiscal 1999. The Company has also written-off
the carrying value of its U.S. mineral properties for the same reason in fiscal
1999. The Company intends to keep those properties on shut down status
indefinitely, pending any significant improvements in commodity markets, or
possibly the sale or joint venture of all or a portion of such properties to or
with other parties. The Company has also closed its Colorado Plateau mining
office in fiscal 1999 and Arizona mining office in fiscal 2000.

B. BUSINESS OVERVIEW

                               CURRENT OPERATIONS

The Company is currently in the process of redefining its business operations to
focus on the development of the alternate feed business. The Company has focused
on the following four areas in the past:

            1)       Mining
            2)       Alternate Feed Processing
            3)       Exploration and Development
            4)       Marketing.

Due to deteriorating commodity prices and other factors, the Company has ceased
its mining and exploration activities, and has shut down all of its mines and
its Mongolian joint venture. The Company intends to keep its Mongolian property
on a shut down status indefinitely, pending any significant improvements in
commodity prices, or possibly sell or joint venture all or a portion of such
property to or with other parties. The Company has closed its Colorado Plateau
and Arizona mining offices and is actively seeking potential purchasers for its
mining properties and mining equipment and taking other steps to minimize its
holding costs for mining properties.

While this reduction in exploration and mining activities is underway, the
Company continues to marshal its resources and concentrate its operations on the
continuing development of the alternate feed, uranium-bearing waste recycling
business, including the possibility of joint venturing or selling all or a
portion of this business with or to other parties. Although the Company has
pursued the alternate feed business in the past, and, as of March 30, 2001, has
received twelve license amendments for the processing of alternate feed
materials at the Mill, the alternate feed business has historically been
considered by the Company to be supplemental to its business of mining and
milling conventional uranium and uranium/vanadium mineralization. With the
recent decline in commodity prices, the Company is now dedicating its full
attention to the development of the alternate feed business as the primary focus
of its business operations. See "Alternate Feed Processing." The Company will
also continue to evaluate other opportunities, unrelated to its mining and
alternate feed activities, as they may arise.


                                       13
<PAGE>


ALTERNATE FEED PROCESSING OVERVIEW

While declining commodity prices seriously affected the Company's conventional
mining, milling and exploration programs, the Company did have some notable
success in the development of its alternate feed, uranium-bearing waste
recycling business. During fiscal 2000, the Company was awarded its third
contract under the U.S. government's Formerly Utilized Sites Remedial Action
Program ("FUSRAP") for the Linde site, near Buffalo, New York. This contract is
a multi-year contract that involves approximately 75,000 tons of uranium-bearing
soils that will be processed through the Mill. The Linde material began arriving
at the Mill in September 2000. Also noteworthy is the fact that the NRC decided
the State of Utah's appeal of the Ashland 2 license amendment, thereby resolving
in the Company's favor the long-standing dispute with the State of Utah over the
types of materials that can be processed at the Mill. See "Alternate Feed
Processing" and "Item 8. Financial Information - Legal Proceedings." The Company
intends to continue to marshal its resources and concentrate its operations on
the development of the alternate feed, uranium-bearing waste recycling business,
including the possibility of joint venturing or selling all or a portion of this
business with or to other parties. The Company continues to expect that the
development of its alternate feed business can result in a profitable business
for the Company, if the Company is able to develop a sufficient backlog of
alternate feed materials to allow the Mill to operate efficiently on a
continuous basis. Despite the Company's successes, however, the Company has not
to date developed the required backlog of alternate feed business. Developing
this backlog will be a prerequisite if the Company is to continue with its
pursuit of this business in the future. See "Alternate Feed Processing."

Process milling of alternate feeds generated $834,484 of the Company's fiscal
2000 revenues, which were approximately 5% of total revenues for the year, as
well as deferred revenue of $6,156,562. The alternate feed processing activities
in fiscal 2000 consisted primarily of the receipt, sampling and analysis of
Ashland 1 material, as well as a small quantity of Linde material, with no
actual processing being conducted. The Company receives a recycling fee as these
materials are delivered, which is recorded as deferred revenue until the
material is processed, at which time it becomes revenue. In fiscal 1998, 1999
and 2000, process milling fees from alternate feed production, combined with
revenues derived from uranium produced from alternate feed materials were,
$15,424,565, $3,812,903 and $2,743,201, respectively, representing 47, 27 and
17% of total revenues for those periods. The remaining revenues received during
those periods were primarily derived from the sale of uranium under long term
contracts acquired on the acquisition of the Energy Fuels Assets, and from the
sale of uranium and vanadium produced from ores mined from the Company's mines.
As mentioned below (see "Marketing"), the Company has sold all of its uranium
inventory and uranium contracts, and all but $837,869 of its vanadium
inventories. It is therefore expected that future revenues will be primarily
from the Company's alternate feed business.

EXPLORATION AND DEVELOPMENT

In the area of exploration and property development, the Company did not
undertake any exploration activities in fiscal 2000. Due to the depressed
uranium market and current market forecasts, the Company shut down the field
operations at the Gurvan-Saihan Joint Venture in fiscal 2000, the Company's
uranium development and exploration program in Mongolia. The project office in
Ulaanbaatar was downsized during the year but will be maintained. Due to the
depressed commodity price and the forecasted slow price recovery, the decision
was made in fiscal 2000 to reduce the carrying value of the Company's investment
in the Gurvan-Saihan Joint Venture by $10,963,248. See "Mongolia Property."

In addition, in order to minimize the holding cost of its U.S. mining
properties, the Company has dropped some portions of its Reno Creek in situ
leach property and, as of March 30, 2001, has entered into an agreement to sell
the remaining portion to a third party in consideration of the assumption by the
third party of all reclamation liabilities associated with the project. See
"Other U.S. Mineral Properties."

MARKETING

Given the continued forecasted weakness in the uranium market, the Company
decided to sell its entire uranium inventory along with its remaining uranium
sales contracts. By combining the contracts with the inventory, the Company was
able to receive better than market prices for its uranium inventory. Net
proceeds were $6.1 million from the sale of the uranium contracts and 395,000
pounds of U3O8 inventory. The spot market for vanadium rose from a low of $1.29
per pound V2O5 in December 1999 to above $2.25 per pound for the period from
March to May,


                                       14
<PAGE>


2000. By fiscal year end the vanadium price was back to $1.70 per pound V2O5.
The Company was able to sell a significant portion of the V2O5 inventory during
the period of higher prices.

                            ALTERNATE FEED PROCESSING

Commissioned in 1980, the White Mesa Mill has processed conventionally mined
mineralized material for the recovery of uranium and vanadium for many years. In
addition, the Company's NRC license gives the Company the right to process other
uranium-bearing materials known as "alternate feeds," pursuant to an Alternate
Feed Guidance adopted by the NRC in 1995. Alternate feeds are uranium-bearing
materials from other processing facilities, which usually are classified as
waste products to the generators of the materials. Requiring a routine amendment
to its license for each different alternate feed, the Company can process these
uranium-bearing materials and recover uranium, in some cases, at a fraction of
the cost of processing conventional ore, alone or together with other valuable
metals such as niobium, tantalum and zirconium. In other cases, the generators
of the alternate feed materials are willing to pay a recycling fee to the
Company to process these materials to recover uranium and then dispose of the
remaining byproduct in the Mill's licensed tailings cells, rather than directly
disposing of the materials at a disposal site. This gives the Company the
ability to process alternate feeds and generate earnings that are largely
independent of uranium market prices. By working with the Company and taking the
recycling approach, the suppliers of alternate feed materials can significantly
reduce their remediation costs, as there are only a limited number of disposal
sites for uranium-bearing materials in the United States.

As of March 30, 2001, the Mill has received twelve license amendments,
authorizing the Mill to process fifteen different alternate feed materials. As
of March 30, 2001, the Mill has recovered approximately 1,125,000 pounds of U3O8
from the processing of alternate feed materials. Of these amendments, seven have
involved the processing of feeds provided by nuclear fuel cycle facilities and
private industry and one has involved the processing of Department of Energy
material. These eight feed materials were generally relatively high in uranium
content and relatively low in volume. The remaining four amendments have been to
allow the Mill to process uranium-bearing soils from former defense sites, known
as Formerly Utilized Sites Remedial Action Program ("FUSRAP") sites, which are
being remediated by the U.S. Army Corps of Engineers (the "Corps"). These
materials are typically relatively low in uranium content but relatively high in
volume. The Company has received and processed approximately 44,000 tons of
FUSRAP material from the Ashland 2 site near Buffalo, New York, and, as of March
30, 2001, is receiving such material from the Ashland 1 and Linde sites, both
near Buffalo. The Ashland 1 and Linde sites are estimated to ship approximately
150,000 tons and 75,000 tons, respectively. Previously, material excavated from
FUSRAP sites was only directly disposed of at one of the few direct disposal
sites in the country, and at considerable cost. The Corps, charged with the task
of reducing the cost of this remediation program, awarded the Ashland 2 contract
to the Company to recycle the materials and recover uranium before disposing of
the resulting tailings in the Mill's tailings cells. By processing these soils
through the Mill for the recovery of uranium, the Company was able to allow the
Corps to clean up this site at a fraction of the cost that would have been
incurred had the disposal-only option been used.

As of March 30, 2001, the Company estimates that there are potentially several
million tons of uranium-bearing soils and materials located at FUSRAP and
similar sites. It is anticipated that these uranium-bearing soils will be
excavated and then transported to either a disposal only facility or in some
cases to a recycling facility, like the White Mesa Mill.

Even though there are significant volumes of materials estimated under the
government programs, nuclear fuel cycle facilities and private industry will
remain an important part of the Company's alternate feed program over the
foreseeable future. For example, the second alternate feed campaign completed in
fiscal 1999 involved an alternate feed material that the Company acquired under
a contract with a nuclear fuel cycle facility. The high-grade uranium content of
this material provided the Company with 160,000 pounds of uranium. The Company
continues to receive alternate feeds under this contract. As well, the Company
will continue to be an outlet for smaller private companies seeking recycling as
a preferred and often cheaper alternative to direct disposal.

Government remediation projects, such as those involving the clean-up of FUSRAP
sites, are generally well known in the industry. Each such project typically
takes several years to characterize and to obtain all agency approvals required
in order to proceed to remediation. Once the project reaches the remediation
stage, and government funding has been allocated to the project, it typically is
put out to tender for sealed bids, and site remediation, transportation and
disposal/recycling facility contracts are then awarded. This process typically
takes several months to complete. Once contracts are awarded, actual remediation
could last for months to years, depending on


                                       15
<PAGE>


the size of the project and government funding priorities. Depending on the
project, there are typically two to five qualified disposal/recycling facilities
that will bid on each contract. There are also other government sources of
alternate feed materials that are not on any particular schedule or program for
remediation. These are not as well known in the industry, and it is incumbent
upon the Company to identify these. These types of contracts may be sole-source
or may be subject to public tender, depending on the circumstances. While some
private industry contracts relate to private sites that must be remediated under
regulatory order or directive within set time frames and in many respects
resemble government remediation contracts in scope and timing, most private
industry contracts are not well publicized and need not be remediated within any
set time period. It is incumbent upon the Company to identify these types of
contracts . Most of these types of contracts are sole-source . As of March 30,
2001, the Company has been successful in obtaining approximately 50% of the
contracts for which it submitted a competitive bid and approximately 75% of all
contracts sought.

While the progress made to date is considerable, there have been regulatory
uncertainties associated with this uranium recycling business. As noted, the
Company's license gives the Company the right, with appropriate amendments, to
process alternate feeds. These amendments are granted under the rules and
regulations of the NRC. Some of the Company's alternate feed projects have been
challenged by the State of Utah, which has believed that the State of Utah
should have regulatory authority over these projects instead of the NRC.
Activities have also been challenged by a commercial disposal company. As of
March 30, 2001, the Company's White Mesa Mill has been granted twelve license
amendments for processing alternate feeds out of twelve requests, and the
Company has successfully defended all challenges before the NRC, to date. In
fact, in February, 2000 the NRC rendered a decision, upholding the amendment to
the Company's NRC license amendment that allowed the Company to process the
Ashland 2 FUSRAP materials. This decision by the five NRC Commissioners affirmed
an earlier ruling by the Atomic Safety and Licensing Board, and resolved in the
Company's favor the long-standing dispute with the State of Utah over the types
of materials that can be processed at the Mill. As a result of this ruling, it
is clear that the uranium bearing soils and materials located at former defense
sites that are being pursued by the Company can be processed at the Mill in
accordance with NRC health and safety regulations. See "Item 8. Financial
Information - Legal Proceedings."

While the legal dispute between the Company and the State of Utah has been
resolved, the Company nevertheless continues to work with the Utah Department of
Environmental Quality ("UDEQ") to resolve any concerns that UDEQ has regarding
the operations at the Mill. The Company and UDEQ have made considerable progress
in this regard to date, and the Company intends to continue working with UDEQ to
cooperatively resolve any outstanding issues in a manner that will provide UDEQ
with the regulatory comfort it desires while still allowing the Company to
pursue the development of its alternate feed business. See "Item 8. Financial
Information - Legal Proceedings."

In conducting its alternate feed business to date, the Company has not been
dependent on patents or technological licenses or new manufacturing processes
(other than those that have been developed by the Company as necessary),
although it has been dependent upon entering into commercial contractual
relations with generators of alternate feed materials. Costs of processing
alternate feed materials are dependent upon costs of raw materials and labor,
which in the case of some reagents, while readily available, can be volatile.
However, volatility in the cost of such materials has not significantly impacted
costs of processing alternate feeds to date.

The Company continues to expect that the development of the business of
recycling uranium-bearing materials can result in a profitable business for the
Company. As noted above, there are potentially millions of tons of this type of
material in the U.S., enough to keep the White Mesa Mill operating at capacity
for the foreseeable future. In order for the Company to become profitable in
this business the Company must be able to: A) identify a sufficient number of
contracts that would be profitable for the Company; B) be successful in winning
a sufficient number of these contracts in the face of competition from other
facilities; and C) receive these contracts in a time frame and have sufficient
backlog of such contracts to allow the Mill to operate at a sufficient capacity
to more than cover its costs of production, any standby costs that are incurred
between Mill runs, and other corporate overheads. Despite its successes in
developing this new business opportunity and the receipt of alternate feed
materials from various sources, the Company has not to date developed this
required backlog of alternate feed business to result in sustained profitable
operations for the Company. Given the timeframes inherent in bidding for and
being awarded government contracts and identifying and securing commercial
contracts for alternate feed materials, this could take a matter of years to
achieve. Developing this backlog will be a prerequisite if the Company is to
continue with its pursuit of this business in the future. While the Company's
shutdown of its exploration and mining activities is underway (see "Current
Operations"), the Company intends to continue to marshal its resources and
concentrate its operations on the continuing development of the alternate feed,
uranium-bearing waste recycling business, including


                                       16
<PAGE>


the possibility of joint venturing or selling all or a portion of this business
with or to other parties. However, if the Company cannot develop the required
backlog of alternate feed business in the near future, it may consider pursuing
other business opportunities as they may arise.

                              THE URANIUM INDUSTRY

Although the Company has placed all of its uranium mines on standby, and has
sold all of its uranium inventories and supply contracts, it nevertheless
produces some uranium from the processing of alternate feed materials. While the
processing of alternate feed materials is often associated with a processing fee
payable to the Company, and hence the revenues derived from alternate feed
processing are typically sheltered from the full effects of changes in the price
of uranium, the value of the uranium produced is still dependent upon uranium
prices. Also, the value of the Company's uranium properties can be dependent
upon changes in uranium prices. For these reasons, the Company has included a
brief description of the uranium industry, as of March 30, 2001.

OVERVIEW

Considerable growth in world demand for electricity has created a strong market
for the development of nuclear power over the past 30 years, and it now
contributes 17% of world electricity supply. In the U.S., production costs at
nuclear power plants are the lowest of any major reliable electricity source.
The low operating cost combined with the increased focus on climate change could
result in increased electricity production from nuclear generators.

According to the Uranium Institute ("UI"), there are 103 nuclear reactors in the
United States and a total of 435, worldwide, representing a total world nuclear
capacity of 350 GWe. The UI reports in one case that world nuclear generating
capacity is expected to grow to 422 GWe by 2010 and 483 GWe by 2020. With the
only significant commercial use for uranium being nuclear fuel for nuclear
reactors, it follows that reactor requirements will be a key indicator in the
nuclear fuel market.

Generally, uranium is mined and milled, converted, enriched and fabricated prior
to use in a nuclear reactor. Once a uranium deposit is discovered and reserves
delineated, uranium ore is mined either by underground, open pit or in situ
methods then partially refined at a nearby mill to produce uranium concentrates.
Typically, the uranium concentrate or U3O8, or yellowcake as it is referred to
in the industry, is sold by the mining companies to electricity utilities in the
form of U3O8. Market participants, such as utilities, then contract with the
converters, enrichers, and fuel fabricators for services to further refine the
yellowcake for use in a nuclear reactor.

URANIUM SUPPLY AND DEMAND

According to the UI, annual Western World uranium consumption has increased from
approximately 56 million pounds U3O8 in 1980 to about 148 million pounds U3O8 in
1999. Demand could increase by increased plant operating capacities or reduced
by premature closing of nuclear power plants.

Demand for uranium can be supplied through either primary production (newly
mined uranium) or secondary sources (inventories and alternate production).
Inventories are of particular importance to the uranium industry when compared
to other commodity markets, as further described below.

According to the UI, primary uranium production had been in decline for a decade
until the first rise in production in 1995, which was reported to be 73 million
pounds. Of this, Canada and Australia accounted for approximately 43% of total
production. Increases continued in 1996 and 1997 to 77 and 79 million pounds,
respectively. The increase in western world production was short lived with a
drop in production to 75 million beginning in 1998. Major production cut backs
and delays were announced at the end of 1998 in Canada, Australia, United States
and South Africa, which has resulted in a significant drop in production to 68
million pounds for 1999.

Secondary sources of supply cover all uranium, other than primary production,
sourced to satisfy reactor requirements. These sources include inventories,
stockpiles (primarily, government and military related) and recycled uranium.
These supply sources can be held at any point of the nuclear fuel cycle and by
utilities and other fuel cycle companies or by governments, alike. Each source
must meet appropriate specifications to be utilized in nuclear reactors.


                                       17
<PAGE>


Inventories represent the largest portion of secondary sources of supply and can
be quite difficult to quantify. Inventories include production inventories held
by producers and utilities, and government and military stockpiles. Inventories
are held for a variety of reasons, such as: government policy, avoiding supply
disruptions and taking advantage of favorable market prices.

The recycling of Highly Enriched Uranium ("HEU") is a unique subset of secondary
sources of supply and is accounted for separately from inventories. Surplus
fissile military materials are converted from HEU into low enriched uranium
("LEU") suitable for use in nuclear reactors. In February 1993, the United
States and Russia entered into an agreement (the "Russian HEU Agreement") which
provided for the United States to purchase 500 metric tons of Russian HEU over a
20-year period. In April 1996, the United States Enrichment Corporation ("USEC")
Privatization Act gave Russia the authority to sell Russian natural uranium
derived from the LEU in the United States over the 20-year period under certain
limits.

The USEC Privatization Act provides a framework for the introduction of Russian
uranium into the U.S. commercial uranium market. The agreement was signed during
July 1998 between the Russian government and three Western companies granting an
option to the Western companies to purchase a portion of the Russian natural
uranium derived from the LEU.

URANIUM PRICES

Most of the countries that use nuclear-generated electricity do not have a
sufficient domestic uranium supply to fuel their nuclear power reactors, and
their electric utilities secure a substantial part of their required uranium
supply by entering into medium-term and long-term contracts with foreign uranium
producers. These contracts usually provide for deliveries to begin one to three
years after they are signed and to continue for several years thereafter. In
awarding medium-term and long-term contracts, electric utilities consider, in
addition to the commercial terms offered, the producer's uranium reserves,
record of performance and cost competitiveness, all of which are important to
the producer's ability to fulfill long-term supply commitments. Under
medium-term and long-term contracts, prices are established by a number of
methods, including base prices adjusted by inflation indices, reference prices
(generally spot price indicators but also long-term reference prices) and annual
price negotiations. Many contracts also contain floor prices, ceiling prices,
and other negotiated provisions which affect the amount paid by the buyer to the
seller. Prices under these contracts are usually confidential.

Electric utilities procure their remaining requirements through spot and
near-term purchases from uranium producers and traders. Traders source their
uranium from organizations holding excess inventory, including utilities,
producers and governments.

The spot market is the market for uranium which may be purchased for delivery
within one year. Over the last ten years, annual spot market demand averaged
roughly 26 million pounds U3O8 with a record high of 42 million pounds U3O8 in
1995 followed by a low, over the period, to 28 million pounds U3O8 in 1999.
Historically, spot prices have been more volatile than long-term contract
prices, increasing from $6.00 per pound in 1973 to $43.00 in 1977, then
declining from $40.00 in 1980 to a low of $7.25 in October of 1991. More
recently, the record spot demand aided to push prices to $16.50 in June 1996.
Trade restrictions limiting the free flow of uranium from the former CIS
republics into the Western world markets, the Nuexco bankruptcy under Chapter 11
of the United States Bankruptcy Code and related defaults on deliveries (see
"Bankruptcy of Oren Benton and Nuexco"), and the reluctance of uranium producers
and inventory holders to sell at low spot price levels, contributed to increases
in demand and spot prices between 1995 and 1997. These factors had a diminishing
impact on the uranium market causing prices to decline. The drop in spot demand
in the following four years largely contributed to a relatively steady drop in
prices to $7.40 in September 2000. Prices remained depressed as a result of weak
demand, falling to $7.10 in January 2001, but had risen to $8.20 by March 2001.

Future uranium prices will depend largely on the amount of incremental supply
made available to the spot market from the remaining excess inventories, primary
production in Russia and other former CIS republics, as well as supplies from
Russian HEU and other Russian stockpiles, from excess United States HEU and
increased production from unutilized capacity of other uranium producers. Some
analysts believe that prices will begin to increase, but the increase will be
gradual and over an extended time period.


                                       18
<PAGE>


COMPETITION

The Company markets uranium to utilities in direct competition with supplies
available from various sources worldwide. The Company competes primarily on the
basis of price. Uranium production is international in scope and is
characterized by a relatively small number of companies operating in only a few
countries. In 1999, five (5) companies, Cameco, Compagnie Generales des Matieres
Nucleaires ("Cogema"), Energy Resources of Australia Ltd. ("ERA"), The RTZ
Corporation PLC ("RTZ"), and WMC Limited, produced over 67% of total world
output. Most of Western World production was from only eight countries: Canada,
Niger, Australia, Namibia, South Africa, United States, France, and Gabon. In
1988, the former CIS, and mainland China began to supply significant quantities
of uranium annually into Western World markets. The Canadian uranium industry
has in recent years been the leading world supplier, producing 25 million pounds
U3O8 on average over the past few years, or about 35% of total world production.
The Company's total production is a small percentage of total Western World
production.

                               THE VANADIUM MARKET

THE FOLLOWING IS A BRIEF SUMMARY OF THE VANADIUM MARKET AS OF MARCH 30, 2001.

As a co-product of the production of uranium from the Colorado Plateau District
ores, the Company has produced and sells vanadium. As of March 30, 2001, the
Company holds an inventory of approximately 424,000 pounds V2O5 blackflake and
approximately 145,000 pounds V2O5 as vanadium pregnant liquor.

Vanadium is an essential alloying element for steels and titanium, and its
chemical compounds are indispensable for many industrial and domestic products
and processes. The principal uses for vanadium are: (i) carbon steels used for
reinforcing bars; (ii) high strength, low alloy steels used in construction and
pipelines; (iii) full alloy steels used in castings; (iv) tool steels used for
high speed tools and wear resistant parts; (v) titanium alloys used for jet
engine parts and air frames; and (vi) various chemicals used as catalysts.

Principal sources of vanadium are (i) titaniferous magnetites found in Russia,
China, Australia and South Africa; (ii) sludges and fly ash from the refining
and burning of U.S., Caribbean and Middle Eastern oils; and (iii) uranium
co-product production from the Colorado Plateau. While produced and sold in a
variety of ways, vanadium production figures and prices are typically reported
in pounds of an intermediate product, vanadium pentoxide, or V2O5. The White
Mesa Mill is capable of producing three products, ammonium metavanadate ("AMV")
and vanadium pregnant liquor ("VPL"), both intermediate products, and vanadium
pentoxide ("flake", "black flake", "tech flake" or "V2O5"). The majority of
sales are as V2O5, with AMV and VPL produced and sold on a request basis only.

Vanadium is generally produced as a by- or co-product of other metal production.
In the United States, the most significant source of production has been as a
byproduct of uranium production from ores in the Colorado Plateau District,
accounting for over half of historic U.S. production. Vanadium in these deposits
occurs at an average ratio of six pounds of vanadium for every pound of uranium,
and the financial benefit derived from the byproduct sales have helped to make
the mines in this area profitable in the past. However, low prices for both
uranium and vanadium in recent years have forced producers in the Colorado
Plateau District to place their facilities on standby.

The market for vanadium has fluctuated greatly over the last 15 years. Over
capacity in the mid-1970s was caused by reduced demand for vanadium during the
recession that plagued the steel industry. By the end of the decade, steel
production had climbed to record levels and prices for V2O5 firmed at around
$2.75 per pound. During the early 1980s, quoted prices were in the range of
$3.00 per pound, but increased exports from China and Australia, coupled with
the continued economic recession of the 1980s drove prices to as low as $1.30
per pound. Prices stabilized in the $2.00 - $2.45 per pound range until
perceived supply problems in 1988 caused by cancellation of contracts by China
and rumors of South African production problems resulted in a price run-up of
unprecedented magnitude, culminating in an all time high of nearly $12.00 per
pound in February of 1989. This enticed new producers to construct additional
capacity and oversupply problems again depressed the price in the early 1990s to
$2.00 per pound and below. Late in 1994, a reduction in supplies from Russia and
China, coupled with concerns about the political climate in South Africa and a
stronger steel market caused the price to climb to $4.50 per pound early in
1995. In the beginning of 1998, prices had climbed to a nine-year high of $7.00
caused by a supply deficit unable to keep pace with record demand from steel and
aerospace industries. However, during the second half of 1998, prices began to
decline to $5.42 per pound by September 1998 and $2.56 per pound in December
1998. This was due to sudden decreases in Far East steel production, along with
suppliers from Russia and China selling


                                       19
<PAGE>


available inventories at low prices in order to receive cash. Since that time,
prices have fallen dramatically due in part to the difficult economic conditions
being experienced throughout the Pacific Rim and new sources of supply.

Vanadium supply and demand estimates for the near future show yearly consumption
to increase at a rate of 2 to 3% from its current level of 130 million pounds
V2O5. Worldwide production capacity increased from its current level of 120
million pounds in the year 2000 with the startup of a primary vanadium producer
in Australia. Recent comments in trade journals have indicated that the major
South African producers have augmented their production by the integration of
their ferro-vanadium production. Many experts believe that there will continue
to be some oscillation in the market price over the next 12 to 18 months before
a sustained recovery is expected to be experienced at what such experts believe
may be near the $2.50 to $3.00 per pound range.

Vanadium has been largely producer-priced historically, but during the 1980s,
this came under pressure due to the emergence of new sources. As a result,
merchant or trader activity gained more and more importance. Prices for the
products that are produced by the Company will be based on weekly quotations of
the London Metal Exchange ("LME"). Historically, vanadium production from the
White Mesa Mill has been sold into the world-wide market both through traders,
who take a 2% to 3% commission for their efforts and, to a lesser extent,
through direct contacts with domestic converters and consumers. While priced in
U.S. dollars per pound of V2O5, the product is typically sold by the container,
which contains nominally 40,000 pounds of product packed in 55 gallon drums,
each containing approximately 550 pounds of product. Typical contracts will call
for the delivery of one to two containers per month over a year or two to a
customer with several contracts in place at the same time. Pricing is usually
based on the LME price and may include floor and ceiling price protection for
both the producer and seller. Spot sales are also made based on the current LME
quote.

C. ORGANIZATIONAL STRUCTURE

The Company conducts its business through a number of subsidiaries. A diagram
depicting the organizational structure of the Company and its subsidiaries,
including the name, country of incorporation and proportion of ownership
interest is included as Exhibit 1.1 to this Form 20-F.

All of the Company's U.S. assets are held through the Company's wholly owned
subsidiary International Uranium Holdings Corporation. International Uranium
Holdings Corporation holds its assets through a series of Colorado limited
liability companies: the White Mesa Mill through IUC White Mesa LLC; the
Colorado Plateau mines through IUC Colorado Plateau LLC, IUC Sunday Mine LLC and
IUC Properties LLC; the Arizona Strip properties through IUC Arizona Strip LLC;
the Reno Creek property through IUC Reno Creek LLC; and the Bull Frog and other
exploration properties through IUC Exploration LLC. All of the U.S. properties
are operated by International Uranium (USA) Corporation, a wholly owned
subsidiary of International Uranium Holdings Corporation.

The Company's 70% interest in the Gurvan Saihan Joint Venture in Mongolia is
held through International Uranium Company (Mongolia) Ltd, which is wholly owned
by International Uranium (Bermuda I) Ltd, a wholly owned subsidiary of the
Company.


D. PROPERTY, PLANTS AND EQUIPMENT

The following is an overview of the properties held by the Company as of March
30, 2001:

                                 WHITE MESA MILL

OVERVIEW

The White Mesa Mill, a fully permitted uranium mill with a vanadium co-product
recovery circuit, is located in southeastern Utah near the Colorado Plateau
District and the Arizona Strip. The Mill is approximately six (6) miles south of
the city of Blanding, Utah. Access is by state highway.

Construction of the White Mesa Mill started in 1979, and conventionally mined
uranium mineralized material was first processed in May 1980. The Mill cost $40
million to construct; with inflation, more stringent permitting requirements,
and the lack of suitable sites, the cost of constructing a facility such as the
White Mesa Mill, if


                                       20
<PAGE>


possible, would be considerably more than that amount today. The Mill is in
compliance with NRC and EPA standards, and is a standard design with both
uranium and vanadium circuits.

During mining, uranium mineralized material is received at the Mill and
stockpiled. The material is initially fed to an 18-foot diameter SAG Mill, then
stored in slurry form in one of the two pulp storage tanks. The Mill utilizes a
two-stage leach process where overflow solution from the No. 1 CCD Thickener is
combined, in an "acid kill" step, with feed from the pulp storage tanks. The
slurry from this first stage leach is then separated in the pre-leach thickener,
with the solids going to the second stage leach and the clarified solution going
to the solvent extraction circuits. Concentrated sulfuric acid, steam, and an
oxidizer are added in the second stage leach. This slurry is subsequently fed to
the 8-stage CCD Circuit where the underflow is discharged to tailings. In full
operation, the Mill employs approximately 100 people.

CURRENT CONDITION AND OPERATING STATUS

The Mill has been on standby since the completion of the conventional Mill run
in November 1999. During this period of standby the Mill has been receiving and
stockpiling alternate feed materials from the Ashland 1 FUSRAP site, as well as
other alternate feed materials. The Company intends to maintain the Mill on
standby status until a sufficient stockpile of alternate feed material has been
accumulated at the Mill to justify an efficient Mill run, at which time the Mill
will re-commence operations. The Mill is maintained in good operating condition
and is capable of commencing a Mill run at any time without the need for
regulatory approvals or any significant capital expenditures. In addition to
receiving and stockpiling alternate feed materials for future processing, the
primary focus of the personnel at the Mill is to ensure that the operating
status of the Mill is maintained, so that the Mill remains ready for operation
at any time.

INVENTORIES

As of September 30, 2000, there were no inventories of U3O8 at the Mill. As of
that date, there were approximately 424,000 pounds of vanadium, as black flake,
and approximately 170,100 pounds of vanadium, as vanadium pregnant liquor,
located at the Mill.

TAILINGS

Synthetic lined cells are used to contain tailings and, in one case, solutions
for evaporation. There is sufficient volume available, as of March 30, 2001, for
approximately another 200,000 tons of tailings solids. Thereafter, Cell No. 4A
can be utilized after it is relined. Difficulties have been encountered with
damages to the seams in the liner for Cell No. 4A. This cell contains no
tailings at present, and the damage is due to working of the liner by thermal
stress, since it has not been placed in use and has been exposed to full
sunlight for several years. The cell must be relined with a better quality
material before using it to deposit tailings. After Cell No. 4A is relined,
approximately 2,000,000 tons of tailings solids can be disposed of in Cell No.
4A before an additional cell will be needed.

The environmental assessment for the Mill permits that a total of three
forty-acre tailings cells may be added. Each additional tailings cell can
accommodate approximately two million tons of tailings, for a total of 12 years
of operation at 2,000 tons per day, 260 operating days a year.

REQUIRED CAPITAL EXPENDITURES

Other than routine maintenance, the only significant capital project anticipated
over the next three years with respect to operations of the White Mesa Mill is
the relining of tailings Cell No. 4A, assuming that the Mill continues to
process materials at a rate similar to the rate of production over the past
three years, at an estimated cost of $1,500,000-$3,000,000. In addition, if Cell
No. 4A is put into use the reclamation obligation for the Mill would increase by
approximately $1,000,000, which would require an increase in the Mill's
reclamation bond by that amount. It is not expected that these expenditures will
be required during fiscal 2001.

RECENT OPERATIONS

Since January of 1995, the Mill has completed several campaigns: the processing
in 1995 and 1996 of approximately 200,000 tons of stockpiled mineralized
material, mainly from the Arizona Strip Mines; the processing in 1996 of an
alternate feed source; the processing in 1997 of three alternate feed sources;
in 1998, the Company


                                       21
<PAGE>


completed a processing run of uranium-bearing tantalum residues for a major
tantalum producer; and, in 1999 the Company completed the processing of two
alternate feed sources and the majority of its 87,250 ton conventional mill run.
Since that time the Mill has been on standby.

OPERATION AT REDUCED CAPACITY

Design capacity of the Mill is 2,000 tons per day of mined material, which would
yield 6 million pounds U3O8 per year from Arizona Strip ore or 3 1/2 million
pounds per year of U3O8 and up to 18 million pounds per year of V2O5 from
Colorado Plateau materials. The Mill, at its 2,000 tons per day design capacity,
is oversized for the foreseeable tonnages expected over the next few years. The
larger the capacity, the larger the interval between Mill runs, as ore must be
stockpiled to provide adequate mill feed.

The Company has modified the Mill to a reduced effective capacity of
approximately 1,050 tons of material per day. This will allow the Mill to be run
more frequently and will reduce the amount of time that material is stockpiled.
However, the unit cost of milling materials increases as the capacity of the
Mill is reduced. Certain alternate feeds can be run at a lower daily capacity,
without requiring any significant capital improvements to the Mill.

The Company's capital expenditures required to reduce the capacity of the Mill
were approximately $100,000, and that amount is approximately the same amount
that would be required to increase capacity at a later date, should that
alternative become economically attractive.

CLOSURE

THE FOLLOWING DISCUSSION OF THE COMPANY'S CURRENT PLANS FOR THE FUTURE OPERATION
OF THE MILL CONSTITUTES FORWARD LOOKING STATEMENTS WITHIN THE MEANING OF FEDERAL
SECURITIES LAWS. SEE "SPECIAL NOTE REGARDING FORWARD LOOKING STATEMENTS."

In the future, should the Company choose to shut down and close the Mill, it
would be subject to certain closure costs. The estimate of closure costs for the
Mill was revised by the Company after discussion with the NRC. These estimated
closure costs as of March 30, 2001, are summarized as follows:

                          WHITE MESA MILL CLOSURE COSTS

<Table>
<S>                                                              <C>
CATEGORY
Mill dismantling and decommissioning                               $  1,505,168
Tailings cell #2 Reclamation                                          1,082,870
Tailings cell #3 Reclamation                                          1,565,444
Tailings cell #4A Reclamation                                           120,128
Tailings cell #1 Reclamation                                          1,234,212
Miscellaneous - management, hygiene, radiation, etc                   1,939,480
                                                                   ------------
Direct Costs                                                          7,447,302
Contractors' Profit                                                     744,730
Contingency                                                           1,117,095
Licensing and bonding                                                   148,946
Long term care fund                                                     606,721
                                                                   ------------

TOTAL ESTIMATED COSTS                                              $ 10,064,794
                                                                   ============
</Table>

On February 10, 2000 the NRC issued amendment No.13 to the Mill license which
reduced the surety from $11,469,859 to $9,682,467. On July 21, 2000 this amount
was increased to the amount shown above.

SEQUENTIAL RECLAMATION

As each pond, or cell, is filled with tailings, the water is drawn off and
pumped to the evaporation pond and the sands allowed to dry. As each cell
reaches final capacity, reclamation will begin with the placement of interim
cover over the tailings. Additional cells are excavated into the ground, and the
overburden is used to reclaim previous cells. In this way there is an ongoing
reclamation process.


                                       22
<PAGE>


GROUND WATER DISCHARGE PERMIT

Although the Mill is designed as a facility that does not discharge to
groundwater, the Company is negotiating a Groundwater Discharge Permit with the
State of Utah Department of Environmental Quality, which will give the State of
Utah dual jurisdiction over the protection of groundwater at the Mill site. The
State of Utah requires that every operating uranium mill in the State of Utah
have a State Groundwater Discharge Permit, regardless of whether or not the
facility discharges to groundwater.

                         SUMMARY OF MINERALIZED MATERIAL

The following is a summary of the Company's estimates of the uranium and
vanadium contained in mineral deposits on the Company's various properties, as
of March 30, 2001:

Conventional Mines

<Table>
<Caption>
            Project           Mineralized Tons     %U3O8           %V2O5
            -------           ----------------     -----           -----
<S>                          <C>                <C>           <C>

Arizona Strip Mines(1)(4)
         Arizona(1)                  80,000          0.652
         Canyon                     108,000          0.903
         Pinenut                    110,000          0.427
                                 ----------     ----------
         Total Arizona Strip        298,000          0.660

Colorado Plateau(2)(4)            1,506,750          0.206         1.208

Bullfrog Project(3)(4)            1,937,000          0.334
                                 ----------     ----------
</Table>

          1)   The reported mineralized tons for the Arizona Strip mines include
               extraction dilution losses (which includes mining dilution and
               mining recovery losses).

          2)   The reported mineralized tons for the Colorado Plateau mines
               include extraction dilution losses(which includes mining dilution
               and mining recovery losses).

          3)   The reported mineralized tons for the Bullfrog Project do not
               include extraction dilution losses.

          4)   Processing of uranium bearing material in a uranium/vanadium
               recovery mill normally results in recovery of approximately 94%
               to 98% of the contained uranium and 70% to 80% of the contained
               vanadium. Milling Recovery losses are not included in the
               foregoing table.

In-Situ Leach Projects(5)

<Table>
<Caption>
                            Mineralized Tons               %U3O8
                            ----------------               -----
<S>                     <C>                             <C>

Reno Creek                       4,286,000                 0.075
Mongolia JV                     21,672,000                 0.052

Total ISL Projects              25,958,000                 0.055
</Table>

          5)   Total uranium recovery from ISL projects is normally in the range
               of 70% to 75% of the in place mineralization. These recovery
               losses are not incorporated in the foregoing figures for the
               Registrant's ISL projects.

The Company mined uranium and vanadium-bearing mineralized material from its
Sunday and Rim Mine complexes in the Colorado Plateau District from November
1997 to mid-1999. In mid-June, 1999, the Company elected to suspend mining
operations as a result of continuing weak uranium and vanadium prices and the
expectation that these conditions would not improve for the next few years. The
Company has also written-off the carrying value of its mineral properties for
the same reason. None of the Company's mineral properties should be considered
economically viable at this time; hence none of the above properties should be
considered to contain "reserves" but should be classified as "mineral deposits."



                                       23
<PAGE>


                            COLORADO PLATEAU DISTRICT

OVERVIEW

The Uravan mineral belt in the Colorado Plateau (the "Colorado Plateau
District") has a lengthy mining history, with the first shipment of mined
materials made to France in 1898. World War II brought increased attention to
the uranium mineralization in the Uravan area, and by the 1950s this district
was one of the world's foremost producers of both uranium and vanadium.
Production continued more or less uninterrupted until 1984 when low uranium
prices forced the closure of all operations. Production resumed in 1987, but
once again ceased in 1990. Total historical production from the Union Carbide
mines (many of which were later purchased by Energy Fuels, and hence the
Company) in the Uravan area is reported at 47 million pounds of U3O8 and 273
million pounds of vanadium, yielding an overall ratio of V2O5/U3O8 of 5.79.

EXPLORATION POTENTIAL

The uranium mineralization found in the Colorado Plateau was deposited in
sediments in alluvial fans formed by braided streams. The shape and size of the
mineralized lenses are extremely variable. As a result, exploration and mining
have historically involved conducting exploration to find a lense and then
merely following its erratic path, with little additional surface exploration
drilling other than development drilling in the course of following the seam.
This is unlike other types of mining where mineralization is almost completely
delineated by surface explorative drilling prior to mining.

The unusual nature of these deposits has therefore traditionally resulted in a
limited amount of resources being dedicated to delineate reserves prior to
mining. Traditionally, there will be some reserves that have been delineated at
the beginning of each year, uranium will be mined during the year and
approximately the same amount of reserves will remain delineated at the end of
the year. This pattern has persisted since the 1940s.

Based on this history of production from the Colorado Plateau, the Company
believes that if commodity prices improve the potential to continue this pattern
of production exists and that additional mineral deposits will be delineated
each year that mining continues.

Presently mineral deposits estimated to contain approximately 1,506,750 tons
with an average grade of 0.206% U3O8 and 1.208% V2O5 have been identified by the
Company in its Colorado Plateau properties. These estimates take into account
extraction dilution losses, but do not include milling recovery losses, which
are estimated to be 2% to 6% for uranium and 20% to 30% for vanadium.


GEOLOGY

The Company's properties in this geographic area are typical uranium-vanadium
deposits of the Colorado Plateau type located in the southern end of the Uravan
mineral belt. The rocks of the Colorado Plateau are predominately sedimentary
ranging in age from Precambrian to Tertiary and, although uranium mineralization
occurs in sediments of different ages, the most important deposits of the Uravan
belt occur in the Salt Wash Member of the Jurassic Morrison Formation.

The Salt Wash Member consists of light gray to light brown sandstones
interbedded with red-green siltstones and mudstones. The sandstones, which are
generally fine-grained and well to moderately sorted, are considered to have
been deposited as alluvial fans by braided streams. The mineralization occurs in
the lenticular sandstone deposits as tabular, elongate bodies generally parallel
to the bedding following the palaeo-channels. All of the large deposits within
the Morrison Formation are in the upper sandstone lens of the Salt Wash Member,
commonly known as the third rim. Fine-grained uraninite is the dominant uranium
mineral accompanied by lesser amounts of coffinite. The chief vanadium mineral
is montrosite. In the oxidized parts of the deposits the distinctive yellow
colored uranyl-vanadate mineral, carnotite, is common.

Individual deposits are small, varying in length from a few hundred to several
thousand feet and in width from a hundred to a thousand feet. Thickness varies
from a few inches to several tens of feet, but generally average between two to
five feet. Mines often contain several such mineralized deposits. The host
sediments are generally flat lying to low dipping with little structural
deformation.


                                       24
<PAGE>


OPERATIONS

The Company's principal mining complexes in the Colorado Plateau District
consist of the Deer Creek, Monogram, Thunderbolt, Sunday, and East Canyon (Rim)
zones. The bulk of the mineral deposits in the Colorado Plateau District are
contained in three areas: the Sunday Mine Complex; the Deer Creek complex, which
includes the La Sal and Pandora mines; and, the East Canyon Area, which includes
the Rim Mine. All of these areas have developed, permitted mines that have been
shut down, pending any significant improvements in commodity prices. The
location of these mines is indicated on the following figure:


                                      [MAP]


The Company commenced conventional mining operations at its Sunday Mine Complex
in November 1997 and at its Rim Mine in January 1998 after completion of mine
development activities. The Company continued the mining of uranium and vanadium
bearing materials from these mines until mid-1999. At that time, the Company
elected to suspend operations at these mines as a result of continued weak
uranium and vanadium prices and the expectation that these conditions would not
improve for the next several years. The shutdown of the mines took several
months to complete, and the process of shutting the mines down was completed in
November 1999. The mines continue to remain in a shutdown status pending any
significant improvements in commodity prices. During this mining campaign a
total of approximately 81,500 tons of mineralized material with a U3O8 grade
of 0.28% and a V2O5


                                       25
<PAGE>


grade of 1.9% was mined from these mines. This mineralized material together
with approximately 5,750 tons of mineralized material from independent mines was
milled at the White Mesa Mill during the period June 1999 to November 1999, to
recover approximately 487,000 pounds of U3O8 and 2.0 million pounds of V2O5

Due to the shutdown of mining operations on the Colorado Plateau, the Company
closed its field office in Dove Creek Colorado during the period July to
November 1999.

                                  ARIZONA STRIP

OVERVIEW

The Arizona Strip is an area bounded on the north by the Arizona/Utah state
line; on the east by the Colorado River and Marble Canyon; on the West by the
Grand Wash cliffs; and on the south by a mid-point between the city of Flagstaff
and the Grand Canyon. The area encompasses approximately 13,000 square miles.
The Arizona Strip is separate and distinct from the Colorado Plateau District.
The two mining districts are located approximately 200 air miles (310 road
miles) apart and have been historically administered as two separate mining
camps.

The Company owns a number of permitted mines, partially developed properties,
known deposits and well developed prospects in the Arizona Strip., all of which
have been shut down pending any significant improvements in commodity prices.

Since 1980, when mine development first began at Hack Canyon II, the Arizona
Strip has produced in excess of 19 million pounds of uranium, from seven mines,
each of which was owned and operated by Energy Fuels. Of these mines, Hack
Canyon I, II, and III, Pigeon and Hermit are mined out and have been reclaimed;
Pinenut, Kanab North, Canyon and Arizona 1 have remaining mineral deposits but
have been placed on shut down status pending any significant improvements in
commodity prices. Mineral from the Arizona Strip mines can be hauled by truck
from the mine sites to the White Mesa Mill. The Arizona 1 Mine is 307 road
miles, and the Canyon Mine is 316 road miles from the Mill.

Due to the shutdown of mining activities and the Company's initiatives to reduce
the holding costs of its U.S. mineral properties, the Company has sold its field
office in Fredonia Arizona, effective March 31, 2000.

MINE DEVELOPMENT

The mineral deposits occur in collapsed breccia pipes and range from 1,000 to
1,800 feet below surface with a vertical extent of up to 600 feet thick. Each of
the mines in the Arizona Strip consists of one breccia pipe. The pipes typically
are 200 to 400 feet in diameter. Within this envelope the mineral deposits can
be at times massive but often are irregular and discontinuous.

A 1,000 to 1,600 foot deep shaft is generally required to access the deposits.
In the case of the Hack Canyon I, II, and III mines, access was obtained through
declines driven from nearby canyons.

BACKGROUND GEOLOGY

Breccia pipes are collapse features created by cavern dissolution in the Redwall
Limestone, some 3,000 feet below present day surface. Overlying sediments
fracture as the cavern size increases and ultimately collapse forming a
pipe-like structure, which is filled with the rubble of the sediments. Uranium
mineralization occurs in this brecciated rock, forming deposits 200 to 400 feet
in diameter, some 600 feet thick at depths up to 1,800 feet.

Uranium mineralization is hosted by the breccia in a sand, silt, and clay
matrix. The principal uranium mineral, pitchblende, occurs primarily in the
matrix, filling voids between sand grains and replacing rock fragments. Pyrite
is the principal gangue mineral. Calcite and gypsum are common cementing
minerals. Copper, lead and zinc minerals may also be present.

Nearly always, the pipe is haloed by alteration or a zone of bleaching resulting
from the partial removal of red iron minerals from formations surrounding the
pipe. "Ring fractures" are often seen at the pipe margins. These fractures may
also be an important host for associated mineralization and reserves.


                                       26
<PAGE>


DESCRIPTION

The Arizona Strip properties consist of several developed and partially
developed mines and exploration properties, including the Arizona 1, Canyon,
Pinenut and Kanab North mines, all of which have been shut down pending any
significant improvements in commodity prices. The Arizona Strip properties are
estimated to contain in total approximately 298,000 tons with an estimated
average grade of approximately 0.66% U3O8. These estimates take into account
extraction dilution losses, but do not include milling recovery losses which are
estimated to be 2% to 6% for uranium. The location of these mines is indicated
on the following figure:


                                      [MAP]


EXPLORATION POTENTIAL

Since 1980, Energy Fuels developed nine mine projects, from which seven mines
produced a total of 19 million pounds of uranium, or approximately 2.7 million
pounds of uranium per mine.

Energy Fuels conducted an extensive exploration program in the Arizona Strip.
Since 1980, Energy Fuels identified in excess of 1,300 breccia pipe targets.
Of these, Energy Fuels drilled at least one hole on 140 breccia pipe targets,

                                       27
<PAGE>


of which 62 were verified to be breccia pipes, and identified mineralization in
42 of these. The Company acquired the most prospective of the breccia pipes
discovered by Energy Fuels; select known breccia pipes with identified
mineralization are still held by the Company.


                          OTHER U.S. MINERAL PROPERTIES

In addition to the mineral properties on the Colorado Plateau and the Arizona
Strip, the Company also acquired from Energy Fuels the Bullfrog, Reno Creek and
Dewey Burdock properties located in the United States.

BULLFROG PROPERTY

The Bullfrog property is located in eastern Garfield County, Utah, 20 miles
north of Bullfrog Basin Marina on Lake Powell, about 40 air miles south of
Hanksville, Utah, and 150 miles from the White Mesa Mill.

More than 2,200 rotary drill holes have been completed on the Bullfrog property.
There are no surface or underground workings or infrastructure on the property.
The location of the Bullfrog property is indicated on the figure under the
heading "Colorado Plateau District - Operations."

In 1993, Energy Fuels personnel calculated an in-place mineral deposit of
1,937,000 tons at a grade of 0.334% U3O8. A higher grade portion of the deposit
was estimated by Energy Fuels to contain 1,300,000 tons at a grade of 0.417%
U3O8. These estimates do not take into account extraction dilution losses or
milling recovery losses.

RENO CREEK PROPERTY

The Reno Creek Property is a potential uranium in situ leach ("ISL") mine
project located in the Powder River Basin of northeastern Wyoming, 47 miles
south of Gillette. Access to the property is by state highway, which cuts
through the property. The location of the Reno Creek Property is indicated on
the following figure:



                                       28
<PAGE>


                                      [MAP]


Uranium at Reno Creek occurs in mineral sands at depths from 300 to 420 feet
below surface. The roll fronts in the area are typically low grade (average less
than 0.15% U3O8) and thick (average up to 17 feet). About 4,000 drill holes are
completed and logged on the property. These holes are generally on lines normal
to the roll front, spaced approximately 200 feet apart with hole spacing thereon
100 feet or greater.

In the 1980s, a field pilot plant was operated on the property. The pilot plant
demonstrated that an ISL process could mine uranium and that the ground water
can be restored after mining.

Due to the weak uranium market, the Company has suspended all licensing work on
its Reno Creek property, and portions of the Reno Creek property were dropped in
fiscal 1999. As of January 31, 2001, the Company estimates remaining mineral
deposits to contain approximately 4.286 million tons of mineralized material at
an average grade of 0.075% U3O8. Total uranium recovery would normally be
expected to be in the range of 70% to 75% of this in place mineralization. These
recovery losses are not incorporated into these figures. As of March 30, 2001,
the Company has entered into an agreement with a third party to acquire the
remaining portion of this property in consideration of the party assuming the
reclamation liabilities associated with the property and removing the Company
from its obligations with respect to the properties.


                                       29
<PAGE>


DEWEY BURDOCK PROPERTY

The Dewey Burdock property area is located near the Edgemont Mining District in
southwest South Dakota near the Wyoming-South Dakota border. The nearest larger
centers with air connections are Rapid City, South Dakota about 100 miles by
road and Casper, Wyoming, about 175 miles by road. The location of the Dewey
Burdock property is indicated on the previous figure.

The Dewey Burdock deposit has been considered as a candidate for ISL mining.
Although the mineral deposit computation has been confined to sands below the
water table, little is known concerning the permeability and flow rates of the
host sandstones. Comprehensive tests would have to be conducted before the
mineral deposit could be conclusively determined to be amenable to ISL.

Portions of the Dewey Burdock property were dropped in 1999. The remaining
mineral deposits were dropped in 2000, and the Company no longer has an interest
in this property.

                                MONGOLIA PROPERTY

OVERVIEW AND PROJECT STATUS

The Company owns a 70% interest and is the managing partner in the Gurvan-Saihan
Joint Venture, which holds five concession blocks that, as of March 30, 2001,
cover a total of 12,100 square kilometers in central eastern Mongolia. The other
participants in the Joint Venture are the Mongolian government and a Russian
geological concern, each as to 15 percent.

Since the Joint Venture's inception in 1994, it has invested over $10 million in
exploration on its concessions, and has discovered mineral deposits containing
approximately 21.67 million tons of mineralized material at an average grade of
approximately 0.052% U3O8 amenable to the in situ leach method of mining.

Due to the depressed uranium market and current market forecasts, the Company
shut down the Joint Venture's field operations during fiscal 2000. The project
office in Ulaanbaatar was also downsized significantly during the year, but will
be maintained. Reclamation and remediation costs for these activities, which are
the responsibility of the Joint Venture, were not significant and were funded
through the sale of surplus Joint Venture equipment and assets. The Company
intends to maintain the project on a shutdown status until market conditions
warrant additional investment or the Company locates an additional Joint Venture
participant. Due to the favorable and unique Mineral Agreement between the Joint
Venture and the Mongolian government, the Joint Venture is able to hold its land
position at minimal cost.

                                   PERMITTING

As discussed above, due to deteriorating commodity prices and other factors, the
Company has shut down all of its mines. The Company intends to keep those
properties on a shut down status indefinitely, pending any significant
improvements in commodity markets, or possibly the sale or joint venture of all
or a portion of such properties to or with other parties.

The permitting status of the various mines as of March 30, 2001, is set out
below.

SUNDAY MINE COMPLEX

The Sunday Mine Complex is fully permitted for its mining activities. Recent
changes in the laws of Colorado could give rise to additional future permitting
requirements.

In recent years, the State of Colorado passed a law that provides that the
Colorado Division of Minerals and Geology ("DMG") can determine that a mine is a
Designated Mining Operation (a "DMO") if it is a mining operation at which
"toxic or acidic chemicals used in extractive metallurgical processing are
present on site or acid- or toxic-forming materials will be exposed or disturbed
as a result of mining operations." If a mine is determined to be a DMO, the most
significant result is the requirement that it submit an Environmental Protection
Plan (an "EPP"). The EPP must identify the methods the operator will utilize for
the protection of human health, wildlife, property and the environment from the
potential toxic- or acid-forming material or acid mine drainage associated


                                       30
<PAGE>


with the operations. The EPP must be submitted to the DMG for review, and after
a public hearing, a decision must be made within 120 days of the submission of a
complete application, unless the application is considered to be complicated,
which would extend the deadline to 180 days.

In 1995, DMG notified Energy Fuels that it believed the Sunday Mine Complex was
a DMO, because of the potential that storm water could come in contact with the
low grade waste rock on site. Energy Fuels disputed this assertion. Testing was
performed on the waste rock. In November 1996, the DMG advised Energy Fuels that
the test results of the average uranium content of the waste dumps at the mine
sites satisfied the DMG that the Sunday Mine Complex is not a DMO. However, the
DMG also advised that its determination could change if site conditions or
circumstances change. As of March 30, 2001, the Company has not been notified of
any additional permitting requirements relating to its mining activities at the
Sunday Mine Complex.

OTHER COLORADO PLATEAU MINES

The Rim, Van 4 and certain other Colorado Plateau mines are also permitted for
mining.

ARIZONA STRIP MINES

The Canyon Mine is the first mine to be permitted in the portion of the Arizona
Strip that is south of the Grand Canyon. The Canyon Mine is located on federal
lands administered by the United States Forest Service and is near the southern
rim of the Grand Canyon. The plan of operations submitted by Energy Fuels in
1984 for development and operation of the mine generated significant public
comment resulting in the preparation of an environmental impact statement by the
United States Forest Service. The United States Forest Service for the State of
Arizona approved the plan set forth by Energy Fuels and issued all necessary
federal and state permits and approvals. The Havasupai Indian Tribe and others
filed appeals. The United States Forest Service for the State of Arizona and
Energy Fuels prevailed on all appeals. During the permitting process, Energy
Fuels constructed all the necessary service facilities at the mine site. Energy
Fuels agreed with the United States Forest Service not to implement underground
development during the environmental impact statement process. Energy Fuels did
not resume underground development at the mine site after the appeals were
decided due to the decrease in uranium prices at that time.

In 1992, the State of Arizona updated its laws relating to groundwater issues,
requiring that an Aquifer Protection Permit be obtained. It is not expected that
there will be any problems of any significance in obtaining this permit, and the
Company is currently permitted to commence mining at the Canyon Mine during
submittal, review and update to the Aquifer Protection Permit.

As with the Canyon Mine, the Pinenut and Kanab North mines require that an
Aquifer Protection Permit be obtained. Work is currently in progress to obtain
these Aquifer Protection Permits. All of these projects are currently permitted
to commence mining during submittal, review and update to these Aquifer
Protection Permits. The Arizona 1 Mine currently has an aquifer protection
permit and is fully permitted for mining.

                                   RECLAMATION

The Company is responsible for the environmental and reclamation obligations
relating to all of its existing mines and assets, as well as for all reclamation
and environmental obligations associated with all mined out, inactive, reclaimed
or partially reclaimed mines and properties acquired from Energy Fuels.

The total amount of the estimated reclamation liability is approximately
$12,200,000 with restricted cash and marketable securities of approximately $8.9
million securing the liability, as of September 30, 2000. All of the Company's
mines and the White Mesa Mill were permitted through either state or federal
authorities. As a part of the permit requirements, reclamation and
decommissioning bonds are in place to cover the estimated cost of final project
closures. The major cost is for closure of the White Mesa Mill and tailings
cells which is estimated as of March 31, 2001, at approximately $10.1 million.
The Company has posted a reclamation bond to the NRC for this amount.

Although the Company's financial statements contain as a liability the Company's
current estimate of the cost of performing these reclamation obligations, and
the bonding requirements are generally periodically reviewed by


                                       31
<PAGE>


applicable regulatory authorities, there can be no assurance or guarantee that
the ultimate cost of such reclamation obligations will not exceed the estimated
liability contained on the Company's financial statements.

In addition, effective January 20, 2001, the BLM implemented new Surface
Management (3809) Regulations pertaining to mining operations conducted on
mining claims on public lands. The new Regulations impose significant
requirements on permitting of operations and on plans for reclamation and
closure of mining operations on public lands. Although the new Regulations are
being challenged by industry, the Regulations could ultimately impose new
requirements on those properties held by the Company under mining claims. Such
new requirements could increase the amount of reclamation bonds held by the
Company and could also impose more onerous and costly operation and reclamation
conditions. On March 23, 2001, the BLM published a proposal to suspend the 3809
regulations pending public comment. The proposal gives the BLM the flexibility
to review public comments before issuing a final rule resulting in the agency
(1) suspending the 3809 regulations completely and reinstating the former rules,
as a proposed; (2) retaining parts of the 3809 regulation while suspending
others; or (3) retaining the 3809 regulations in their present form. If the BLM
ultimately suspends the 3809 regulations, in whole or in part, a new rule will
supersede it at that time.

                             SWISS ROYALTY INTEREST

Two Swiss Utilities acquired a 40% limited partnership interest in almost all of
Energy Fuels' properties in the United States. This limited partnership interest
did not apply to the Mongolia Property.

In 1995, after commencement of the bankruptcy proceedings against Energy Fuels,
the Swiss Utilities agreed to fund the milling of approximately 200,000 tons of
stockpiled mineralized material, the proceeds of which were used to repay this
funding provided by the Swiss Utilities, and to provide working capital to the
bankrupt estates. As part of this financing and mill run, Energy Fuels and the
Swiss Utilities agreed to convert the Swiss Utilities' 40% limited partnership
interest in the United States properties into a royalty (the "Swiss Royalty") of
9% of all uranium and 5% of all vanadium and all other minerals produced from
the United States properties owned by Energy Fuels at the time that the royalty
was granted. The Swiss Royalty was applicable to all production from the
Colorado Plateau District properties and Arizona Strip properties acquired on
the Acquisition, as well as the Reno Creek Property, most of the Dewey Burdock
Property and the Bull Frog Property. The Swiss Royalty Interest did not apply to
the Mongolia Property, nor to any tolled mineralized material, or purchased
mineralized material from third parties, or Alternate Feeds processed in the
White Mesa Mill, nor to any properties acquired by Energy Fuels after the date
that the Swiss Royalty Interest was granted.

Subsequent to the Acquisition, the Company amended the Swiss Royalty amount to
4.5% of all uranium and 2.5% of vanadium for the period from January 1, 1998 to
December 31, 2000. In consideration of that amendment, the Company made advance
royalty payments of $250,000 per year, which were fully recoupable annually
against any royalties for the applicable calendar year. Subsequent to December
31, 2000, the royalty was to revert to its original terms.

In June 2000, the Swiss Royalty was terminated and cancelled in consideration of
a payment by the Company of a total amount of $175,000 to the Swiss Utilities.

                             OTHER ASSETS OF COMPANY

ADMINISTRATIVE OFFICES

The Company has a head office in Denver, Colorado, as well as field offices in
Blanding, Utah, and Ulaanbaatar, Mongolia.

EQUIPMENT

The Company acquired extensive mining equipment from Energy Fuels. Given the
Company's decision to suspend all U.S. mining operations, the Company is
currently in the process of selling its mining equipment.


                                       32
<PAGE>


SALES CONTRACTS

In order to maintain a strong cash position and to protect against any further
decline in the spot uranium price, the Company sold its remaining long-term
contracts and uranium inventory.


ITEM 5. OPERATING AND FINANCIAL REVIEW AND PROSPECTS

The following discussion of the financial condition and results of operations of
the Company for the fiscal years ending September 30, 2000, 1999, and 1998,
should be read in conjunction with the consolidated financial statements of the
Company and related notes therein. THIS DISCUSSION CONTAINS FORWARD LOOKING
STATEMENTS - SEE "SPECIAL NOTE REGARDING FORWARD LOOKING STATEMENTS." The
Company's consolidated financial statements are prepared in accordance with
Canadian generally accepted accounting principles. Please refer to Note 16 of
the Consolidated Financial Statements for a discussion of the differences
between Canadian and United States accounting principles and practices that
affect the Company.

A. FISCAL 2000 VERSUS FISCAL 1999

RESULTS OF OPERATIONS

IUC recorded a net loss of $15,244,651 ($0.23 per share) compared with a net
loss of $17,097,677 ($0.26 per share) in 1999. Results for 2000 included
inventory and other asset write-downs of $2,335,290, a write-down of Mongolia
mineral properties of $10,963,248, a net loss of $4,675 on the sale of land and
surplus mining equipment, and a net gain of $1,073,206 resulting from a decrease
in Mill reclamation obligations. In 1999, the net loss included a $168,141 gain
on the sale of surplus mining equipment, a net loss of $7,709,170 for inventory
write-downs, $7,039,958 for the write-off of U.S. mineral properties and
$541,641 for the write-off of goodwill. Excluding these items, IUC lost
$3,014,644 ($0.05 per share) in 2000 and $1,975,049 ($0.03 per share) in 1999.

Changes in the market price of uranium and vanadium significantly affected IUC's
profitability and cash flow. The spot market value of uranium continued to fall
throughout the fiscal year. At the end of the fiscal year, the spot market price
was $7.40 per pound U3O8 compared to $9.75 per pound U3O8 at the beginning of
the year. IUC's realized uranium prices of $11 and $13 per pound U3O8 in 2000
and 1999, respectively, tracked the declining spot market for uranium. In order
to maintain a strong cash position and to protect against any further decline in
the spot uranium price, the Company sold its remaining long-term contracts and
uranium inventory.

The spot market for vanadium rose from a low of $1.29 per pound V2O5 in December
1999 to above $2.25 per pound V2O5 for the period from March to May 2000. By
fiscal year end the vanadium price was back to $1.70 per pound V2O5. The Company
was able to sell a significant portion of its inventory during the period of
higher prices. IUC's realized price per pound V2O5 was $1.88 during fiscal 2000.

Due to the depressed uranium market and current market forecasts, the Company
shut down the field operations at the Gurvan-Saihan Joint Venture, the Company's
uranium development and exploration project in Mongolia, during fiscal 2000. The
project office in Ulaanbaatar has been downsized significantly during the year,
but will be maintained. The Company intends to maintain the project in a standby
mode until market conditions warrant additional investment or the Company
locates a Joint Venture participant.

Also, due to depressed commodity prices, the Company's Arizona strip field
office, located in Fredonia Arizona, was shut down effective March 31, 2000. All
labor, including severance, and disbursements incurred during fiscal 2000 in the
process of shutting down the Fredonia office were expensed as Selling, General
and Administrative as incurred. There were no shut down or reclamation
obligations associated with the shut down of the Fredonia office; therefore, no
additional costs were required to be accrued at fiscal year end. Also, in
February 2000 the Company commenced actively seeking potential purchasers for
its U.S. mining properties and taking other steps, such as dropping nonessential
property holdings and reducing mining staff, to minimize its holding costs for
mining properties. No properties were sold during fiscal 2000 and no severance
obligations were outstanding at year end. Sales of mining equipment began in
June 1999 and continued through October 2000. Proceeds from the sale of surplus
mining equipment were $627,211 for fiscal 2000, resulting in a loss of $4,675.
As the expected net realizable value of the Company's mining equipment at the
end of fiscal 2000 was equal to or greater than its book value, no change in
classification of mining equipment was made as a result of the decision to sell
the equipment.


                                       33
<PAGE>


Revenues for fiscal 2000 and 1999 of $16,060,172 and $14,046,832, respectively,
consisted of uranium sales, vanadium sales and process milling fees. Revenues
for fiscal 2000 increased $2,013,340 or 14% as compared to fiscal 1999. Uranium
sales for fiscal 2000 were $12,810,100 as compared to $9,611,450 in fiscal 1999,
an increase of $3,198,650 or 33%. The increase was due primarily to the
Company's decision to sell all of its remaining long-term contracts and uranium
inventory. Vanadium sales for fiscal 2000 were $2,415,588 as compared to
$146,867 in fiscal 1999, an increase of $2,268,721. The increase was due
primarily to the Company 's decision to sell in fiscal 1999 only a very small
quantity of the vanadium it produced that year.

Process milling fees for fiscal 2000 of $834,484 decreased $3,454,031 or 81% as
compared to process milling fees of $4,288,515 for fiscal 1999. Alternate feed
processing activities in fiscal 2000 have consisted primarily of the receipt,
sampling and analysis of the Ashland 1 material. Approximately 123,500 tons have
been received from the Ashland 1 site. In addition, the Company was awarded its
third FUSRAP contract for the processing and disposal of approximately 75,000
tons of uranium-bearing material from the Linde site in Tonawanda, New York.
This material began arriving at the Mill during September 2000. The Company
receives a recycling fee as these materials are delivered, which is recorded as
deferred revenue until the material is processed. In addition to the recycling
fees, the Company will retain the uranium recovered from these materials.

Cost of products sold for fiscal 2000 were $12,643,509, an increase of
$4,255,642 or 51% as compared to fiscal 1999. The increase was due primarily to
the higher volumes of uranium and vanadium delivered. During fiscal 2000, the
Company delivered 1,165,652 pounds of uranium to three customers and 1,287,553
pounds of vanadium to five customers as compared to 720,000 pounds of uranium
and 69,937 pounds of vanadium during fiscal 1999.

Process milling expenditures for fiscal 2000 of $489,778 decreased $2,012,376 or
80% as compared to process milling expenditures of $2,502,154 for fiscal 1999.
During fiscal 2000, the Company did not process any materials, as compared with
two alternate feed and the conventional ore processing runs in 1999. The Company
is currently building a sufficient stockpile of material to allow for a longer,
more efficient, processing campaign.

In addition to FUSRAP materials, the Company continues to receive deliveries of
alternate feeds from a nuclear fuel cycle operator under a long-term
arrangement. While the Company will not receive a processing fee for this
particular alternate feed it will produce uranium from these materials, which
will then be sold in later periods.

Mill standby expenses consist primarily of payroll and related expenses for
personnel, parts and supplies, contract services and other overhead expenditures
required to receive alternate feed material and maintain the Mill in a standby
mode. During the first quarter of fiscal 2000, the conventional mill run that
began in fiscal 1999 was completed. The Mill produced approximately 158,000
pounds of uranium and 1,100,000 pounds of vanadium during this period. The Mill
was on standby for the remainder of the year. Mill standby expenditures were
$2,144,984 or 13% of revenues for fiscal 2000 as compared to $1,059,794 or 8% of
fiscal 1999 revenues. The increase of $1,085,190 was due to nine months of
standby versus three months in fiscal 1999. The increase in costs due to the
longer duration of the standby was partially offset by significant staff
reductions at the Mill.

Selling, general and administrative expenses consist primarily of payroll and
related expenses for personnel, legal, contract services and other overhead
expenditures. Selling, general and administrative expenses were $4,044,761 or
25% of revenues for fiscal 2000 compared to $4,445,190 or 32% of fiscal 1999
revenues. The decrease of $400,429 related primarily to the Company's decision
at the end of the second fiscal quarter to significantly reduce overhead costs,
and focus its efforts and resources on the development of the alternate
feed/uranium-bearing waste recycling business. It is expected that these reduced
levels of overhead expenditures will continue to decline through fiscal 2001 as
the Company continues to pursue other alternate feed projects and evaluates
other potential opportunities.

In fiscal 2000, due to the continued depressed price of uranium and vanadium,
the Company reduced the carrying value of its finished goods inventories by
$1,026,415. These same low commodity prices, combined with low expectations of
any appreciable price recovery in the near term, resulted in the Company
reducing the carrying value of its investment in the Gurvan-Saihan Joint Venture
by $10,963,248. The write-down differs under U.S. GAAP because, under U.S. GAAP,
exploration costs are expensed as incurred whereas, under Canadian GAAP,
exploration costs were deferred until the project was written-off. In addition,
the Company adjusted the carrying value of the Other Asset and the offsetting
Deferred Credit by a net $1,308,875 to reflect the Company's perception of
future market prices. The Other Asset and Deferred Credit represent a put option
entered into in fiscal 1999, which grants a third party the option to put up to
400,000 pounds of U3O8 back to the Company at a price of $10.55 per pound, at
any one time during the period of October 1, 2001 to March 1, 2003.


                                       34
<PAGE>


B. FISCAL 1999 VERSUS FISCAL 1998

RESULTS OF OPERATIONS

For the year ended September 30, 1999, the Company incurred a net loss of
$17,097,677, compared to a net profit of $1,617,331 for the year ended September
30, 1998. This loss was attributable primarily to weak commodity prices. While
prices fluctuated somewhat during the year, the uranium market ended the fiscal
year at $9.75 per pound U3O8. The vanadium market saw prices plunge dramatically
from $5.37 per pound V2O5 at the beginning of the fiscal year to $1.84 per pound
by year's end. This caused the Company to write down its ore stockpiles, which
contain approximately seven pounds of vanadium for every pound of uranium, and
finished goods inventories by $7,709,170. These same low commodity prices
combined with low expectations of any appreciable price recovery in the near
term also resulted in the Company electing to reduce the carrying value of all
of its U.S. mineral properties to zero. The amount of this write-off was
$7,039,958. In addition, the Company also wrote-off the remaining unamortized
portion of goodwill in the amount of $541,641.

For fiscal 1999, the Company had total revenues of $14,046,832. Of these
revenues, $9,758,317 (69%) was from sales of uranium and $4,288,515 (31%) was
derived from the Company's process milling of alternate feeds. These results are
significantly lower than the corresponding results for the year ended September
30, 1998, where the Company had total revenues of $32,940,876, consisting of
$19,890,300 in U3O8 sales and $13,050,576 of revenues from process milling of
alternate feeds. In addition, the Company delivered 400,000 pounds U3O8 at a
purchase price of $10.80 per pound to a customer under a deferred sales
arrangement. This agreement grants the purchaser the option to put the U3O8 back
to the Company at a price of $10.55 per pound U3O8 at any one time during the
period of October 1, 2001 to March 1, 2003. The transaction was accounted for as
a deferred credit of $4,320,000 and the cost of inventory of $4,248,875 was
reclassified as an other asset. If and when the put option is exercised, these
amounts will be reclassified as revenues and cost of sales, respectively.

The spot market value of uranium remained depressed and basically flat during
the 1999 fiscal year. It began the fiscal year at $9.75 per pound U3O8, rose to
$10.85 in March, then declined during the remainder of the fiscal year back to
$9.75 in September. The spot market value of vanadium, however, suffered a
tremendous decline. It began the fiscal year at $5.37 per pound V2O5 and then
declined during the remainder of the fiscal year to $1.84 in September. As a
result, the Company elected to only sell a very small quantity of the V2O5 it
produced during the year. Also, due to the continued depressed price for U3O8,
the Company only sold U3O8 into existing contracts and elected not to enter into
any additional spot market contracts during the year.

Of the Company's 1999 uranium sales, 100% of the material was sourced from
uranium purchased under pre-existing contracts. The $9,758,317 of uranium sales
proceeds resulted from four separate sales transactions. Approximately 69% of
the sales revenues (61% of the material delivered) arose from long-term
contracts and the balance were from existing spot market contracts.

The Company's alternate feed projects during 1999 consisted primarily of the
processing of over 44,000 tons of uranium-bearing soil materials received from
the Ashland 2 former defense site near Buffalo, New York. The Company received a
recycling fee for this project, which contributed $3,794,195, or 88%, of the
total process milling revenues for the year. The remaining alternate feed
revenues of $494,320 came primarily from the sale of a product from a prior
year's alternate feed project. The Company also produced approximately 160,000
pounds of U3O8 from another alternate feed source. The Company did not receive a
recycling fee for this project, and the U3O8 remains in inventory to be sold at
a later date. The Company's processing costs relating to alternate feeds totaled
$3,213,789 for 1999 resulting in a gross profit from alternate feeds of
$1,074,726.

Selling, general and administrative expenses for 1999 totaled $4,445,190
compared to $3,580,149 in 1998. The increase was due to an increase in outside
legal and professional expenses related to the Company's development of its
alternate feed business and to mine standby costs due to the suspension of
mining operations. Depreciation, amortization and depletion expense was $664,633
in 1999, compared to $734,267 in 1998. Net interest and other income decreased
to $857,739 in 1999 from $1,128,562 in 1998. These total revenues and expenses
combined with the extensive write-offs stated above resulted in a net loss of
$17,097,677 in 1999 compared to net income before taxes of $1,858,892 in 1998.

The Company continued the mining of uranium and vanadium-bearing materials from
its Sunday and Rim Mine complexes in the Colorado Plateau District of western
Colorado and eastern Utah until mid-1999. At that time, the


                                       35
<PAGE>


Company elected to suspend mining operations as a result of continuing weak
uranium and vanadium prices and the expectation that these conditions would not
improve for the next few years. The shut down of the mines took several months
to complete and the process was completed in November 1999. The Company has also
completely written-off the carrying value of its U.S. mineral properties for the
same reason. Prior to the cessation of mining activities, approximately 87,250
tons of mined material, with a U3O8 grade of 0.28% and a V2O5 grade of 1.9% were
mined from Company and independent mines. All of the mined material was shipped
to the Mill and the Company commenced the milling of this material in June 1999.
As of September 30, 1999, approximately 72,750 tons of material had been fed to
the Mill leaving approximately 14,500 tons in stockpile. This stockpile was
written down to the net realizable value of $144,112 based on current spot
market prices.

During fiscal 1999 the process of shutting down the Company's Dove Creek field
office was commenced. All labor and disbursements incurred during fiscal 1999 in
the process of shutting down the Dove Creek office were expensed as Selling,
General and Administrative as incurred. There were no severance, shut down or
reclamation obligations associated with the shut down of the Dove Creek office;
therefore, no additional costs were required to be accrued at fiscal year end.
Also, in February 2000 the Company commenced actively seeking potential
purchasers for its U.S. mining properties and taking other steps, such as
dropping nonessential property holdings and reducing mining staff, to minimize
its holding costs for mining properties. No properties were sold during fiscal
1999 and no severance obligations were outstanding at year end. Sales of mining
equipment began in June 1999 and continued through October 2000. Proceeds from
the sale of surplus mining equipment were $322,660 for fiscal 1999, resulting in
a gain of $168,141. As the expected net realizable value of the Company's mining
equipment was equal to or greater than its book value, no change in
classification of mining equipment was made as a result of the decision to sell
the equipment.

During fiscal 1999, the Mill produced 493,418 pounds U3O8 and 870,960 pounds
V2O5. This includes both uranium produced from conventional mined material as
well as uranium recovered from alternate feeds. During the first quarter of
fiscal 2000, the conventional mill run was completed which produced an
additional 157,709 pounds U3O8 and 1,125,520 pounds V2O5. Actual mill recoveries
were lower than historical levels due primarily to the short mill run and
certain operational problems. These inventories were written down to spot market
prices as of September 30, 1999.

The Company suspended the application and review process for a permit to mine
from the Wyoming Department of Environmental Quality and for a source material
license from the Nuclear Regulatory Commission for the Reno Creek in situ leach
project, located in the Powder River Basin of Wyoming. This review process could
be reinstituted at any time. The Company has also written-off all of its
investment and development expenditures related to this project. These decisions
were, again, related to weak market prices for uranium.

The Gurvan-Saihan Joint Venture, the Company's uranium development and
exploration program in Mongolia, conducted a limited field program during 1999,
focusing most of its efforts on data analysis and production cost modeling for
future mining operations. The Joint Venture has now delineated a deposit for
this program containing approximately 21.67 million tons of mineralized material
at n average grade of approximately 0.052% U3O8. Total cash expenditures by the
Company relating to this Joint Venture were $912,990 in 1999, compared to
$3,209,363 in 1998. Due to depressed commodity prices the Joint Venture
activities were shut down in early fiscal 2000.

The Company continued to increase its focus on acquiring and processing
alternate feeds during the year, which resulted in the Company successfully
processing over 44,000 tons of material from a former government weapons, or
FUSRAP (Formerly Utilized Sites Remedial Action Program), site near Buffalo, New
York. Based on the success of this project the Company signed a contract to
process materials from another FUSRAP site Ashland 1, and began to receive these
materials in July. The recycling fee is paid when the material is delivered to
the Mill and recorded as deferred revenue until the material is processed.

C. CAPITAL RESOURCES AND LIQUIDITY

At September 30, 2000, the Company had cash and cash equivalents of $11,650,600
and working capital of $10,556,005 as compared to cash and cash equivalents of
$469,407 and working capital of $11,635,665 at September 30, 1999.

Net cash provided by operating activities was $5,500,826 for the fiscal year
ended September 30, 2000. The cash flow resulted primarily from the sale of
inventory of $9,211,253, less the loss from continuing operations of


                                       36
<PAGE>


$15,244,651, offset by non-cash items of depreciation and amortization of
$1,094,376, write-down of assets of $13,298,538 and the reduction in Mill
reclamation obligations of $1,073,206. Cash flow from operations was also
affected by the decrease in accounts payable and accrued liabilities of
$1,476,562. This decrease was primarily the result of the completion during
fiscal 2000 of the conventional mill run that began in fiscal 1999.

Net cash provided by investing activities was $525,671 for the fiscal year ended
September 30, 2000. The cash flow resulted primarily from the sale of surplus
mining equipment of $627,211 and a reduction in the Company's bonding
requirements of $473,552, offset by additions to plant and equipment of $244,957
and investments in the Gurvan-Saihan Joint Venture of $332,063.

The Company is projecting only minor expenditures during fiscal year 2001 for
property, plant and equipment. No significant capital expenditures are
anticipated for the Mill during fiscal 2001.

Net cash provided by financing activities during the fiscal year ended September
30, 2000 totaled $5,154,696 and consisted primarily of an increase in deferred
revenues of $6,156,562, offset by payments on the working capital loan agreement
with Wells Fargo Bank, NA of $950,000. During March 2000, the Company renewed
its working capital loan agreement with Wells Fargo Bank, NA. The principal
amount was reduced from $10 million to $5 million and the maturity date was
extended from March 31, 2000 to March 31, 2001. During January 2001, due to its
current cash position, the Company elected to cancel its working capital loan
agreement with Wells Fargo Bank, NA. The Company believes that existing funds
should be sufficient to satisfy working capital requirements and capital
expenditures for the next twelve months.

In order to maintain safety of principal and to meet operational liquidity
requirements, it is the policy of the Company to invest the majority of
available cash balances in short-term fixed income securities (high quality
corporate bonds and U.S. Treasury securities) or short-term money market
instruments (certificates of deposit, commercial paper and other money market
instruments).

D. ENVIRONMENTAL RESPONSIBILITY

Each year, the Company reviews the anticipated costs of decommissioning and
reclaiming its mill and mine sites as part of its environmental planning
process. The Company also formally reviews costs when it submits license renewal
applications to regulatory authorities. Based on this review, the Mill
reclamation obligation was reduced by $1,073,206, and it was determined that the
Company's estimated total reclamation obligation of $12,192,494 as of March 30,
2001, is currently sufficient to cover the projected future costs for
reclamation of the Mill and mine operations.

The Company has posted bonds as security for these liabilities and has
deposited, restricted cash and marketable securities on account of these
obligations. The amount of the restricted cash and marketable securities
collateralizing the Company's reclamation obligations was $8,870,989 at
September 30, 2000.

The Company has detected some chloroform contamination at the Mill site that
appears to have resulted from the operation of a temporary laboratory facility
that was located at the site prior to and during the construction of the Mill
facility. The source and extent of this contamination are currently under
investigation, and a corrective action plan, if necessary, is yet to be devised.
Although the investigations to date indicate that this contamination appears to
be contained in a manageable area, the scope and costs of remediation have not
yet been determined and could be significant. See "Item 8. Financial Information
- Legal Proceedings."

E. 2001 FISCAL YEAR OUTLOOK

The Registrant is currently in the process of redefining the focus of its
business activities.

Historically, the Registrant's operations were significantly dependent upon
uranium and vanadium prices. Due to the low spot price for vanadium and the
continued depressed market for uranium, the Registrant suspended all U.S. mining
activities in 1999. As a result of this suspension, the Registrant completely
wrote-off the carrying value of its U.S. mineral properties in 1999. The
Registrant also does not anticipate that these commodity prices will recover to
levels that would warrant reactivation of these mines for several years. The
Registrant intends to keep those properties in a shutdown status indefinitely,
pending any significant improvements in commodity prices, or possibly sell or
joint venture all or a portion of such properties and interest to or with other
parties. As of March 30, 2001,


                                       37
<PAGE>


the Registrant has closed its Colorado Plateau and Arizona mining offices and is
actively seeking potential purchasers for its mining properties and mining
equipment and taking other steps to minimize its holding costs for mining
properties.

While this reduction in exploration and mining activities is underway, the
Registrant intends to marshal its resources and concentrate its United States
operations on the continuing development of the alternate feed, uranium-bearing
waste recycling business, including the possibility of joint venturing or
selling all or a portion of this business with or to other parties. The
Registrant will also continue to evaluate other opportunities unrelated to its
mining and alternative feed activities, as they may arise.

The Company's decision to focus its resources and attention primarily on the
development of its alternate feed, uranium-bearing waste recycling business
means that the Company is less susceptible to variations in uranium and vanadium
market prices. The Company's U.S. mining operations will continue to be on a
care and maintenance basis, as well as its Mongolian project. Due to the
decision to sell all of the uranium inventory and sales contracts, the Company
is relying primarily on revenue from alternate feed processing fees and the
uranium produced from these feeds.

The reduction in Mill standby costs and general and administration expenditures
means that the Company will have the resources to continue to aggressively
pursue the alternate feed market. As of March 30, 2001, the Company has three
firm contracts, which provide sufficient feed to operate the Mill for up to nine
months. The Company is continuing to pursue other contracts; however, it is also
looking at opportunities to diversify, as they may arise.

F. RISKS AND UNCERTANTIES

REGULATORY CHALLENGES

Under the NRC's Alternate Feed Guidance, the Mill is required to obtain a
specific license amendment allowing for the processing of each new alternate
feed material. Certain of the Mill's license amendments have been challenged by
various third parties in the past, although none of such challenges have been
successful to date. The Company intends to continue to defend its positions and
the validity of its license amendments and proposed license amendments. If the
Company does not ultimately prevail in any such actions and any appeals
therefrom, the Company's ability to process certain types of alternate feeds, in
certain circumstances, may be adversely affected, which could have a significant
impact on the Company.

G. CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

The Company wishes to caution readers that disclosures made in the foregoing
sections and elsewhere in this 20-F represent forward-looking statements. These
forward-looking statements involve known and unknown risks and uncertainties
which may cause the actual results, performance, or achievements of the Company
to be materially different from any future results, performance, or achievements
expressed or implied by any forward-looking statements made by or on behalf of
the Company.

Risk factors that affect the Company's results and the above discussion of the
2001 outlook include, but are not limited to, competition, environmental
regulations, the ability to develop the alternate feed business, changes to
reclamation requirements, dependence on a limited number of customers,
volatility and sensitivity to market prices for uranium and vanadium, the impact
of changes in foreign currencies' exchange rates, changes in government
regulation and policies including trade laws and policies, receipt of permits
and approvals from governmental authorities (including amendments for each
alternate feed transaction) and other operating and development risks.

As a result of the foregoing and other factors, no assurance can be given as to
the future results, levels of activity and achievement.

H. RESEARCH AND DEVELOPMENT, PATENTS AND LICENSES

The Company does not have a research and development program per se. Process
development efforts expended in connection with the processing of alternate
feeds are included as a cost of processing. Process development efforts expended
in the evaluation of potential alternate feed materials that are not ultimately
processed at the Mill are



                                       38



<PAGE>
included in Mill overhead costs. The Company does not rely on patents or
technological licenses in any significant way in the conduct of its business.

I. TREND INFORMATION

During the last three fiscal years, the Company has seen a deterioration in both
uranium and vanadium prices, from $11 per pound of U3O8 and $4.10 per pound of
V2O5 in October 1997 to $7.40 per pound of U3O8 and $1.70 per pound of V2O5 at
the end of September, 2000. As a result of these decreases in commodity prices
and projected future market conditions, the Company decided to cease its mining
and exploration activities, and has placed all of its mines and its Mongolian
joint venture on a shutdown status. The Company intends to keep those properties
on a shutdown status indefinitely, pending any significant improvements in
commodity markets, or possibly sell or joint venture all or a portion of such
properties and interest to or with other parties. The Company has written off
the carrying value of all of these properties on its financial statements.

As a result of these market events, the Company decided to marshal its resources
and to concentrate its operations on the continuing development of the alternate
feed, uranium-bearing waste recycling business. While the Company has had
successes in developing this business, such as the award of its third FUSRAP
contract for the Linde site during the last fiscal year, the Company has not, to
date, developed the backlog of business necessary to allow the Mill to operate
beyond the next Mill run, which, as of March 30, 2001, is scheduled to commence
in 2001. Developing this backlog is the major challenge facing the Company at
this time.

Although the Mill's tailings system currently has capacity to process all of the
alternate feed materials under contract with the Company, this capacity is
expected to run out within the next one to three years, depending on the level
of success of the Company in entering into contracts for the processing of
additional feed materials. In order to provide additional tailings capacity, the
Company will have to repair existing tailings Cell No. 4A, at an estimated cost
of $1.5-$3.0 million. In addition, if Cell No. 4A is put into use the
reclamation obligation for the Mill would increase by approximately $1.0
million, which would require an increase in the Mill's reclamation bond by that
amount. The repair of Cell No. 4A will provide the Company with approximately 2
million tons of additional tailings capacity, which should be ample capacity for
the foreseeable future.

ITEM 6. DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES

A. DIRECTORS AND SENIOR MANAGEMENT

The names, municipalities of residence, positions with the Company, and
principal occupations of the directors and executive officers of the Company as
of February 15, 2001, are as follows:


                 DIRECTORS AND EXECUTIVE OFFICERS OF THE COMPANY

<Table>
<Caption>
                                               COMMON SHARES OF
                                                  THE COMPANY
                                              BENEFICIALLY OWNED,
                                                  DIRECTLY OR
                               PERIOD OF       INDIRECTLY, OR
NAME AND MUNICIPALITY OF     SERVICE AS A        CONTROLLED OR        PRESENT PRINCIPAL OCCUPATION AND POSITION WITH
       RESIDENCE               DIRECTOR           DIRECTED(1)                         THE COMPANY(3)
-------------------------    ------------     ------------------   ---------------------------------------------------
<S>                          <C>              <C>                  <C>
JOHN H. CRAIG                May 9, 1997                           Lawyer, partner of Cassels Brock & Blackwell LLP;
Toronto, ON                       to               155,000         Director of a number of publicly-traded companies,
                               present                             including: International Curator Resources Ltd. and
                                                                   Tenke Mining Corp.
----------------------------------------------------------------------------------------------------------------------
</Table>


                                       39
<PAGE>


<Table>
<Caption>
                                               COMMON SHARES OF
                                                  THE COMPANY
                                              BENEFICIALLY OWNED,
                                                  DIRECTLY OR
                               PERIOD OF       INDIRECTLY, OR
NAME AND MUNICIPALITY OF     SERVICE AS A        CONTROLLED OR         PRESENT PRINCIPAL OCCUPATION AND POSITION WITH
       RESIDENCE               DIRECTOR           DIRECTED(1)                         THE COMPANY(3)
-------------------------    -------------    ------------------   -----------------------------------------------------
<S>                          <C>              <C>                  <C>
DAVID C. FRYDENLUND          May 9, 1997                           Vice President, General Counsel, Chief Financial
Lone Tree, CO                     to               200,000         Officer and Corporate Secretary of the Company.
                               present
------------------------------------------------------------------------------------------------------------------------
CHRISTOPHER J. F. HARROP     May 9, 1997                           November 1994 to present, Senior Vice-President and
Toronto, ON                       to               300,926         Director, Canaccord Capital Corp.
                               present
------------------------------------------------------------------------------------------------------------------------
RON F. HOCHSTEIN             April 6, 2000                         President and Chief Executive Officer of the Company
Lakewood, CO                       to               100,000        since April 6, 2000; from January 31, 2000 to April
                                present                            6, 2000, Vice President and Chief Operating Officer
                                                                   of the Company.
------------------------------------------------------------------------------------------------------------------------
EARL E. HOELLEN              May 9, 1997                           Self-employed businessman; October 24, 1996 to April
Englewood, CO                     to               750,000         6, 2000,  President and Chief Executive Officer of
                               present                             the Company.
------------------------------------------------------------------------------------------------------------------------
LUKAS H. LUNDIN(2)           May 9, 1997                           Chairman of the Board of the Company; Director and/or
Vancouver, BC                     to                               officer of a number of publicly-traded natural
                               present             458,500         resource companies, including: Lundin Oil AB, Atacama
                                                                   Minerals Corp., Santa Catalina Mining Corp.,
                                                                   International Curator Resources Ltd., Tenke Mining
                                                                   Corp., Tanganyika Oil Company Ltd. and South Atlantic
                                                                   Resources Ltd.
------------------------------------------------------------------------------------------------------------------------
WILLIAM A. RAND              May 9, 1997                           Self-employed businessman; Director of a number of
Vancouver, BC                     to                 Nil           publicly-traded companies, including: Lundin Oil AB,
                               present                             Santa Catalina Mining Corp., International Curator
                                                                   Resources Ltd., Tenke Mining Corp., Tanganyika Oil
                                                                   Company Ltd. and South Atlantic Resources Ltd.
------------------------------------------------------------------------------------------------------------------------
</Table>

(1) Each of the Directors and Officers of the Company own less than one percent
of the outstanding shares of the Company,

(2) Lukas H. Lundin is the son of Adolf H. Lundin, a major shareholder of the
Company. See "Item 7. Major Shareholders and Related Party Transactions."

(3) All persons listed are directors of the Company.

The information as to shares beneficially owned or over which the directors
exercise control or direction, not being within the knowledge of the Company,
has been furnished by the respective directors individually.

All of the above-named directors have held their present positions or other
executive positions with the same or associated firms or organizations during
the past five years, except as follows:

o        Mr. Ron Hochstein was Vice President, Corporate Development of the
         Company from October 11, 1999 to January 30, 2000, and was an
         engineering consultant with the AGRA-Simons Mining Group, an
         engineering and consulting firm, from July 1995 to October 1999.

o        During the period August 1998 to August 1999, Mr. Harrop was Chairman
         and a director of Northern Securities Inc.

o        During the period July 1996 to July 1997, Mr. Frydenlund was
         Vice-President of Namdo Management Services Ltd., a management services
         company. Prior to July 1996, Mr. Frydenlund was a partner with the law
         firm of Ladner Downs, Vancouver, British Columbia.

Please note Item 7 below for information relating to interests of Management in
certain related party transactions.


                                       40
<PAGE>


B. COMPENSATION

DIRECTOR COMPENSATION

No remuneration has been paid to directors of the Company in their capacities as
directors since the date of incorporation, other than stock options described
under "Share Ownership" below. The directors are reimbursed for their expenses
incurred to attend meetings of the Company.

EXECUTIVE OFFICER COMPENSATION

The following table summarizes the compensation of each of the executive
officers of the Company for the year ended September 30, 2000:

                               ANNUAL COMPENSATION
                      FOR THE YEAR ENDED SEPTEMBER 30, 2000

<Table>
<Caption>





                                                                       SECURITIES
                                                                         UNDER
   NAME AND PRINCIPAL                                OTHER ANNUAL     OPTIONS/SARS      ALL OTHER
        POSITION             SALARY(1)     BONUS     COMPENSATION      GRANTED(#)      COMPENSATION
   ------------------        ---------     -----     ------------     ------------     ------------
<S>                          <C>           <C>       <C>              <C>              <C>
Ron F. Hochstein              128,000       Nil          Nil            1,250,000           Nil
President and Chief
Executive Officer(2)(3)
---------------------------------------------------------------------------------------------------
David C. Frydenlund,          158,400       Nil        9,000(4)           700,000           Nil
Vice President, General
Counsel, Chief
Financial Officer, and
Corporate Secretary(2)
---------------------------------------------------------------------------------------------------

Earl E. Hoellen,              104,769       Nil        2,024(8)               Nil         90,948(5)
(former President and
Chief Executive
Officer)(5)
---------------------------------------------------------------------------------------------------

Harold R. Roberts,             50,268       Nil        1,229(9)               Nil         40,195(6)
(former Vice President,
Operations)(6)
---------------------------------------------------------------------------------------------------

Rick L. Townley,               56,269       Nil          844(8)               Nil         26,250(7)
(former Vice President
Finance, Chief Financial
Officer and Treasurer)(7)
---------------------------------------------------------------------------------------------------
</Table>


NOTES TO SUMMARY COMPENSATION TABLE

(1)      The Company's currency for disclosure purposes is US dollars which are
         the functional currency of the Company's operations.

(2)      Each of Messrs. Ron F. Hochstein and David C. Frydenlund have contracts
         of employment with the Company's subsidiary, International Uranium
         (USA) Corporation. There is no compensatory plan or arrangement
         provided in such contracts in respect of resignation, retirement,
         termination, change in control of the Company or responsibilities. The
         expiry date of the employment contracts are October 13, 2001 for Mr.
         Hochstein and June 30, 2001 for Mr. Frydenlund.


                                       41
<PAGE>

(3)      Mr. Hochstein commenced employment with the Company on October 11,
         1999. During the period January 31, 2000 to April 6, 2000, Mr.
         Hochstein held the position of Vice President and Chief Operating
         Officer of the Company. Mr. Hochstein was appointed President and Chief
         Executive Officer of the Company on April 6, 2000.

(4)      Other annual compensation is $9,000, being the dollar value of imputed
         interest benefits from a loan provided to Mr. Frydenlund.

(5)      Mr. Hoellen resigned as President and Chief Executive Officer of the
         Company on April 6, 2000. Compensation figures disclosed for the fiscal
         year ended September 30, 2000 for Mr. Hoellen represent the amounts
         earned between October 1, 1999 and April 6, 2000. Mr. Hoellen received
         $90,000 as a severance payment and $948 for medical insurance coverage
         subsequent to his resignation.

(6)      Mr. Roberts resigned as Vice President, Operations, of the Company on
         January 31, 2000. Compensation figures disclosed for the fiscal year
         ended September 30, 2000 for Mr. Roberts represent amounts earned
         between October 1, 1999 and January 31, 2000. Mr. Roberts received
         $35,000 as a severance payment and $5,195 for medical insurance
         coverage subsequent to his resignation.

(7)      Mr. Townley resigned as Vice President, Finance, Chief Financial
         Officer and Treasurer of the Company on April 6, 2000. Compensation
         figures disclosed for the fiscal year ended September 30, 2000 for Mr.
         Townley represent amounts earned between October 1, 1999 and April 6,
         2000. Mr. Townley received $26,250 as a severance payment.

(8)      Amounts represent 401K matching contributions made to the named
         executive's retirement account per the Company's 401K Benefit Plan
         available to all eligible employees.

There were no long-term incentive plan awards made to any of the named executive
officers of the Company during the most recently completed financial year. In
addition, there are no plans in place with respect to any of the named
individuals for termination of employment or change in responsibilities under
employment contracts, apart from those separately disclosed herein.


   OPTION/SAR GRANTS TO EXECUTIVE OFFICERS DURING THE MOST RECENTLY COMPLETED
                                 FINANCIAL YEAR

<Table>
<Caption>
                                                                                MARKET VALUE
                                                                                OF SECURITIES
                                           % OF TOTAL                            UNDERLYING
                         SECURITIES        OPTIONS/SARS                         OPTIONS/SARS
                            UNDER           GRANTED TO        EXERCISE OR         ON THE
                        OPTIONS/SARS       EMPLOYEES IN       BASE PRICE        DATE OF GRANT       EXPIRATION
           NAME          GRANTED(#)       FINANCIAL YEAR    (CDN$/SECURITY)    (CDN$/SECURITY)         DATE
           ----         ------------      --------------    ---------------    ---------------      -----------
<S>                     <C>               <C>               <C>                <C>                  <C>
Ron F. Hochstein         1,000,000            27.7%               0.20               0.19           May 22/2003
                           250,000             6.9%               0.75               0.26           Oct 10/2002
---------------------------------------------------------------------------------------------------------------
David C. Frydenlund        700,000            19.4%               0.20               0.19           May 22/2003
---------------------------------------------------------------------------------------------------------------
</Table>

A summary of the Company's Stock Option Plan is provided under "Share Ownership"
below.


C. BOARD PRACTICES

Directors are elected annually to one year terms at the annual meeting of
shareholders and serve until the next annual meeting or until their successor is
duly elected. Executive Officers are appointed by the directors and serve until
replaced by the directors or their resignation. Each of the above directors was
elected to his present term of office at the annual meeting of shareholders of
the Company held on February 15, 2001.

Each of Messrs. Ron F. Hochstein and David C. Frydenlund have contracts of
employment with the Company's subsidiary, International Uranium (USA)
Corporation. There is no compensatory plan or arrangement provided in


                                       42
<PAGE>


such contracts in respect of resignation, retirement, termination, change in
control of the Company or responsibilities. The expiry date of the employment
contracts are October 13, 2001 for Mr. Hochstein and June 30, 2001 for Mr.
Frydenlund. None of the other directors have service contracts with the Company
or any of its subsidiaries.

The board of directors does not have an Executive Committee. The board has
established an Audit Committee, a Compensation Committee, a Corporate Governance
and Nominating Committee and an Environment, Health and Safety Committee. The
following table sets out the members of such Committees:


                             COMMITTEES OF THE BOARD

<Table>
<Caption>
                                                        CORPORATE GOVERNANCE       ENVIRONMENT, HEALTH AND
     AUDIT COMMITTEE       COMPENSATION COMMITTEE      AND NOMINATING COMMITTEE       SAFETY COMMITTEE
     ---------------       ----------------------      ------------------------    -----------------------
<S>                        <C>                         <C>                         <C>
   William A. Rand           Lukas H. Lundin            Christopher J.F. Harrop    Christopher J.F. Harrop
    John H. Craig            William A. Rand                William A. Rand          David C. Frydenlund
Christopher J.F. Harrop       John H. Craig                  John H. Craig             John H. Craig
</Table>

AUDIT COMMITTEE

Due to the size and nature of the Company, the roles and responsibilities of the
Audit Committee have been specifically defined and include oversight
responsibility for management reporting on internal control. The Audit Committee
has direct communication channels with the external auditors. Due to its size,
the Company has no formal internal audit process. The terms of reference of the
Audit Committee include the responsibility to: ensure the compliance of
financial reporting with accounting principles; oversee the effectiveness of
management's interaction with and responsiveness to the board of directors;
review annual and interim financial statements before they are approved by the
board of directors; review the nature and scope of the annual audit; review the
adequacy of internal accounting control procedures and systems; and evaluate the
external auditor's performance for the preceding fiscal year, review their fees
and make recommendations to the board of directors.

COMPENSATION COMMITTEE

The Company's executive compensation program is administered by the Compensation
Committee, which is composed of three non-management directors who are
identified above. The Committee meets at least annually to receive information
on and determine matters regarding executive compensation, in accordance with
policies approved by the board of directors. Recommendations for changes to the
policies are also reviewed on an annual basis to ensure that they remain
current, competitive and consistent with the Company's overall goals.

The Committee's terms of reference include the responsibility to determine the
level of compensation paid to the President and Chief Executive Officer of the
Company and other senior management and executive officers of the Company.

The guiding philosophy of the Committee in determining compensation for
executives is the need to provide a compensation package that is competitive and
motivating; will attract and retain qualified executives; and encourage and
motivate performance. Performance includes achievement of the Company's
strategic objective of growth and the enhancement of shareholder value through
increases in the stock price resulting from advances in the Company's business,
continued low cost operations and enhanced cash flow and earnings.

In establishing compensation for executive officers, the Committee takes into
consideration individual performance, responsibilities, length of service and
levels of compensation provided by industry competitors. Such compensation is
comprised primarily of a base salary and participation in the Company's
incentive stock option and 401K plans, and may also consist of bonuses and other
perquisites which are awarded on an occasional basis. Stock options align the
interests of the executive officers and other key employees with the long-term
interests of shareholders and provide competitive performance incentive
compensation. Grants are made to executive officers after taking into
consideration position level, overall individual performance, anticipated future
contribution to the Company's success, and the ability of the individual to
influence business performance.


                                       43
<PAGE>

Compensation is generally reviewed in the early part of each year having regard
to the prior year's performance both at a corporate level and individually in
order to determine compensation adjustments for the following year.

CORPORATE GOVERNANCE AND NOMINATING COMMITTEE

The terms of reference of the Corporate Governance and Nominating Committee
include the responsibility of developing and monitoring the Company's approach
to corporate governance issues, the responsibility for proposing new nominees to
the board of directors and for assessing directors on an ongoing basis, and the
responsibility of assessing and monitoring the effectiveness of the board of
directors as a whole, the committees of the board of directors and the
contribution of individual directors. Nominations are the result of recruitment
efforts by the Chairman of the board of directors and the CEO and discussed
informally with several directors before being brought to the Committee for
approval.

ENVIRONMENT, HEALTH AND SAFETY COMMITTEE

The mining and milling industry, by its very nature, can have a significant
impact on the natural environment. As a result, environmental planning and
compliance must play an ever-increasing part in the operations of any company
engaged in these activities. The Company takes these issues very seriously and
has established an Environment, Health and Safety Committee to oversee the
Company's efforts to act in a responsible and concerned manner with respect to
matters affecting the environment, health and safety.


D. EMPLOYEES

The following table sets out the number of employees of the Company and its
subsidiaries at the end of the period for each of the past three financial
years, and a breakdown of persons employed by main category of activity and
geographic location.


    NUMBER OF EMPLOYEES BY MAIN CATEGORY OF ACTIVITY AND GEOGRAPHIC LOCATION

<Table>
<Caption>
FISCAL YEAR ENDED SEPTEMBER 30     2000     1999     1998
------------------------------     ----     ----     ----
<S>                                <C>      <C>      <C>
Denver Head Office                   8       17       22
White Mesa Mill                     25      104       79
U.S. Mining Properties               0        8       46
Mongolia Office                      4        6        6
Total                               37      135      153
</Table>


None of the Company's employees are unionized.


E. SHARE OWNERSHIP

See the table above under the heading "Directors and Senior Management" for
information as to the share ownership in the Company held by Directors and
Officers of the Company.

The following table summarizes individual grants of options to purchase or
acquire securities of the Company or any of its subsidiaries to each of the
named executive officers and directors as of March 30, 2001.


                                       44
<PAGE>


      STOCK OPTIONS HELD BY DIRECTORS AND EXECUTIVE OFFICERS OF THE COMPANY

<Table>
<Caption>
                                  NUMBER OF COMMON                         OPTION PRICE     OPTION EXPIRY
EXECUTIVE OFFICER AND DIRECTOR   SHARES UNDER OPTION       DATE OF GRANT      (CDN$)            DATE
------------------------------   -------------------       -------------   ------------   ----------------
<S>                              <C>                       <C>             <C>            <C>
John H. Craig                          75,000               May 23, 2000       0.20           May 23, 2003

David C. Frydenlund                   200,000           January 14, 1999       0.75       January 13, 2002
                                      700,000               May 23, 2000       0.20           May 22, 2003

Christopher J.F. Harrop                75,000               May 23, 2000       0.20           May 22, 2003

Ron F. Hochstein                      250,000           October 11, 1999       0.75       October 10, 2002
                                    1,000,000               May 23, 2000       0.20           May 22, 2003

Earl E. Hoellen                       375,000           January 14, 1999       0.75       January 13, 2002

Lukas H. Lundin                       500,000               May 23, 2000       0.20           May 22, 2003

William A. Rand                        75,000               May 23, 2000       0.20           May 22, 2003
                                 ------------
Total                               3,250,000
</Table>


STOCK OPTION PLAN

The major features of the Company's stock option plan (the "Stock Option Plan")
can be summarized as follows:

Under the Stock Option Plan the board of directors, or a committee appointed for
such purposes, may from time to time grant to directors, officers, eligible
employees of, or consultants to, the Company or its subsidiaries, or to
employees of management companies providing services to the Company
(collectively, the "Eligible Personnel") options to acquire Common Shares in
such numbers, for such terms and at such exercise prices as may be determined by
the board or such committee. The purpose of the Stock Option Plan is to advance
the interests of the Company by providing Eligible Personnel with a financial
incentive for the continued improvement of the Company's performance and
encouragement to stay with the Company.

The maximum number of Common Shares that may be reserved for issuance for all
purposes under the Stock Option Plan is 6,700,000 Common Shares and the maximum
number of Common Shares which may be reserved for issuance to any one insider
pursuant to share options and under any other share compensation arrangement may
not exceed 5% of the Common Shares outstanding at the time of grant (on a
non-diluted basis). Any Common Shares subject to a share option which for any
reason is cancelled or terminated without having been exercised will again be
available for grant under the Stock Option Plan.

The maximum number of Common Shares that may be reserved for issuance to
insiders of the Company under the Stock Option Plan and under any other share
compensation arrangement is limited to 10% of the Common Shares outstanding at
the time of grant (on a non-diluted basis).

The board of directors of the Company has the authority under the Stock Option
Plan to establish the option price at the time each share option is granted. The
option price may not be lower than the market price of the Common Shares at the
time of grant.

Options granted under the Stock Option Plan must be exercised no later than 10
years after the date of grant and options are not transferable other than by
will or the laws of dissent and distribution. If an optionee ceases to be an
Eligible Person for any reason whatsoever other than death, each option held by
such optionee will cease to be exercisable 30 days following the termination
date (being the date on which such optionee ceases to be an Eligible Person). If
an optionee dies, the legal representative of the optionee may exercise the
optionee's options within one year after the date of the optionee's death but
only up to and including the original option expiry date.



                                       45
<PAGE>

ITEM 7. MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS


A. MAJOR SHAREHOLDERS

Information is set forth below with respect to persons known to the Company to
be the owner of five percent or more of the Company's voting securities as of
February 15, 2001 and the total amount of these securities owned by the officers
and directors as a group.


                               MAJOR SHAREHOLDERS

<Table>
<Caption>
IDENTITY OF PERSON OR GROUP                       NUMBER OF COMMON SHARES OWNED     PERCENTAGE
---------------------------                       -----------------------------     ----------
<S>                                               <C>                               <C>
Adolf H. Lundin                                          22,500,000(1)                 34.3%

Directors and Officers as a group (7 persons)            24,664,426                    37.6%
</Table>


(1)      These shares are held in escrow pursuant to the terms of an Escrow
         Agreement among the Company, Adolf H. Lundin, Lukas H. Lundin and The
         Montreal Trust Company of Canada. Pursuant to the terms of the
         agreement, one-fifth of the shares were released from escrow one year
         following the date of listing of the Company's common shares on The
         Toronto Stock Exchange, i.e. on May 16, 1998. The balance of the shares
         have been or will be released as to one-fifth on each of the following
         anniversary dates so that all of the shares will be released by May 16,
         2002.

There has been no significant change in the percentage change held by the
foregoing major shareholder during the past three years. None of the Company's
major shareholders have different voting rights than other holders of common
shares of the Company.

As far as it is known to the Company, the Company is not directly or indirectly
owned or controlled by another corporation(s), any foreign government, or by any
other natural or legal person(s).

As of January 31, 2001, 10,970,826, or 16.74%, of the Company's outstanding
common stock were registered in the names of 72 residents of the United States.
The Company's common stock is issued in registered form and the number of shares
reported to be held by U.S. shareholders of record is taken from the records of
The Montreal Trust Company of Canada, the registrar and transfer agent for the
Common Stock.

There are no arrangements, known to the Company, the operation of which may at a
subsequent date result in a change in control of the Company.


B. RELATED PARTY TRANSACTIONS

Lukas H. Lundin, John H. Craig, and William A. Rand are also directors and
officers of other natural resource companies and, consequently, there exists the
possibility for such directors and officers to be in a position of conflict
relating to any future transactions or relationships between the Company or
common third parties. However, the Company is unaware of any such pending or
existing conflicts between these parties. Any decision made by any of such
directors and officers involving the Company are made in accordance with their
duties and obligations to deal fairly and in good faith with the Company and
such other companies. In addition, each of the directors of the Company,
discloses and refrains from voting on, any matter in which such director may
have a conflict of interest.

None of the present directors, senior officers or principal shareholders of the
Company and no associate or affiliate of any of them has any material interest
in any transaction of the Company or in any proposed transaction which has
materially affected or will materially affect the Company except as described
herein.

During the fiscal year ending September 30, 2000 the Company incurred legal fees
of $16,606, to Cassels Brock & Blackwell, a law firm of which John H. Craig is a
partner.

During the fiscal year ending September 30, 2000, the Company paid management
and administrative service fees of $90,000 to a company owned by the Chairman of
the Company, Lukas H. Lundin, which provides office


                                       46
<PAGE>


premises, secretarial and other services in Vancouver. The Company continues to
pay monthly fees of $7,500 to this service company.

During the fiscal year ending September 30, 1997 the Company loaned $200,000 to
David C. Frydenlund, an Officer and Director of the Company, in order to
facilitate relocation to the Company's headquarters. This amount has remained
outstanding at September 30, 1998, 1999 and 2000. This loan is non-interest
bearing and is payable on the earlier of termination of employment or June 30,
2001. The loan is secured by the Officer's personal residence.

Subsequent to the retirement of Mr. Earl E. Hoellen as President and Chief
Executive Officer of the Company in 2000, a company controlled by Mr. Hoellen, a
director of the Company, earned a commission of $59,516 in connection with the
sale by the Company of all of its uranium inventories and sales contracts.


C. INTERESTS OF EXPERTS AND COUNSEL

Not Applicable.


ITEM 8. FINANCIAL INFORMATION

A. CONSOLIDATED STATEMENTS AND OTHER FINANCIAL INFORMATION

CONSOLIDATED STATEMENTS

The consolidated financial statements of the Company are attached hereto as
pages F-1 through F-15 and incorporated herein by reference.

EXPORT SALES

The amount of export sales does not constitute a significant portion of the
Company's total sales volume.

LEGAL PROCEEDINGS

Under the NRC's Alternate Feed Guidance, the Mill is required to obtain a
specific license amendment allowing for the processing of each new alternate
feed material. See "Item 4. Information on the Company Alternate Feed
Processing." On July 23, 1998, the NRC issued an amendment to the Company's Mill
license allowing the receipt and processing of certain alternate feed material
(the "Ashland 2 Materials") at the White Mesa Mill from a Formerly Utilized
Sites Remedial Action Program ("FUSRAP") site. On July 22, 1998, Envirocare of
Utah, Inc., a company licensed by the NRC to dispose of 11e.(2) uranium bearing
byproduct materials at its facility in Tooele County, Utah, filed a request for
a hearing with the Atomic Safety and Licensing Board ("ASLB") for the purpose of
challenging the issuance of the Company's license amendment. On August 19, 1998,
the ASLB Presiding Officer assigned to the matter dismissed Envirocare's
petition for lack of standing. Envirocare appealed its decision to the full
Commission of the NRC on August 31, 1998. The Company and the NRC Staff both
filed oppositions to Envirocare's appeal on September 15, 1998. On November 14,
1998, the full Commission of the NRC denied Envirocare's appeal. On September
23, 1998, Envirocare filed a Petition for Review in the United States Court of
Appeals for the District of Columbia Circuit, appealing the decision in a prior
case (In the Matter of Quivira Mining Company) upon which the dismissal of
Envirocare's claim against the Company was based. On October 22, 1998, the
Company was added as an intervener in the Quivira appeal. Envirocare also
appealed to the United States Court of Appeals for the District of Columbia the
decision of the full Commission of the NRC denying Envirocare standing on the
Ashland 2 matter. This appeal and the Quivira appeal referred to above were
joined as an appeal. On October 22, 1999, the Court of Appeals dismissed
Envirocare's appeal, confirming the NRC's decision denying Envirocare standing
in these matters.

On July 23, 1998, the State of Utah also filed a petition requesting a hearing
on the Company's aforementioned license amendment relating to the Ashland 2
Materials. By Order dated September 1, 1998, Utah's Petition was granted. Utah's
Petition articulated two substantive concerns: 1) that hazardous wastes, as
defined by the Resource Conservation and Recovery Act (42 U.S.C. Section 690 et
seq.) contained in the alternate feed


                                       47
<PAGE>


material to be processed at the site would be disposed of at the site, and 2)
that the Company was not in fact processing the alternate feed material
primarily for its uranium source material content, in alleged contravention of
NRC regulations and State law. Utah alleged that the NRC Staff misinterpreted
NRC Guidance on this matter. The first of these two issues was amicably resolved
between the parties (Utah indicated to the Company that its concerns that the
alternate feed material might contain hazardous wastes was resolved by
additional analytical and other data which was forwarded to Utah by the
Company). On February 9, 1999, the ASLB Presiding Officer ruled in favor of the
Company on the second issue, finding that the Company's license amendment met
all of the requirements of the applicable statutes and regulations and was
appropriately granted. The State of Utah appealed the decision of the ASLB
Presiding Officer to the full Commission of the NRC for review. On February 10,
2000, the NRC Commissioners rendered their decision upholding the decision of
the ASLB Presiding Officer and confirming the validity of the license amendment
for the Ashland 2 Materials, thereby resolving in the Company's favor the
long-standing dispute with the State of Utah over the types of alternate feed
materials that can be processed at the White Mesa Mill. The State of Utah did
not appeal this decision to the U.S. Court of Appeals.

On October 15, 1998, the Company submitted a request to the NRC to amend the
Company's Mill license to allow for the receipt and processing of additional
FUSRAP alternate feed materials (the "Ashland 1 Materials"). This amendment
relating to the Ashland 1 Materials was approved and issued in February 1999.
Anticipating that the license amendment for the Ashland 1 Materials would be
granted, on December 2, 1998, the State of Utah filed a petition requesting a
hearing on the requested Ashland 1 license amendment, on essentially the same
grounds as for the Ashland 2 amendment. On December 18, 1998, the Company
responded by not contesting the State's request for a hearing.

In addition to the State of Utah, Envirocare, Pack Creek Ranch Company, a group
called the Concerned Citizens of Utah and the Navajo Utah Commission filed
petitions requesting a hearing on the Ashland 1 license amendment. The Company
filed submissions with the ASLB Presiding Officer assigned to the Ashland 1
license amendment opposing standing with respect to each of these additional
submissions. The NRC Presiding officer denied standing to each of these parties.
Envirocare appealed this decision to the full Commission of the NRC. The
Commission denied Envirocare's appeal. The hearing on the Ashland 1 license
amendment had been put in abeyance pending the outcome of the appeal of the
Ashland 2 decision before the full Commission of the NRC. On March 13, 2000, as
a result of the NRC's decision on the Ashland 2 appeal, the State of Utah
withdrew its request for a hearing on the Ashland 1 license amendment.

The Company intends to continue to defend its positions and the validity of its
license amendments and proposed license amendments. If the Company does not
ultimately prevail in any such actions and any appeals therefrom, the Company's
ability to process alternate feeds containing lower levels of uranium, in
certain circumstances, may be adversely affected since NRC license amendments
are required for each alternate feed transaction.

During a sampling event at the White Mesa Mill in May, 1999, the Company
discovered unusually high levels of chloroform in one monitoring well which
monitors the water in the perched zone, and is located cross-gradient from the
Mill's tailings impoundments. Investigations by independent experts retained by
the Company indicate that the source of the chloroform is not from Mill
operations or from the Mill's tailings cells. Rather the source appears to be
from a temporary laboratory facility that was located at the Mill site prior to
construction and operation of the Mill, and that disposed of laboratory wastes
into a State of Utah inspected and approved disposal leach field. Further
investigations are ongoing. On August 23, 1999, while acknowledging that this
contamination does not threaten groundwater resources in the regional aquifer,
because the aquifer is separated from the perched zone by some 1,200 feet of
low-permeability rocks, the State of Utah issued a Corrective Action Order
requiring the Company to investigate the source and extent of chloroform
contamination and, if necessary, to develop a corrective action plan to address
the chloroform contamination. The Company is performing investigations and
taking actions in accordance with the Corrective Action Order. Although
investigations to date indicate that this contamination appears to be contained
in a manageable area, the scope and costs of remediation have not yet been
determined and could be significant.

DIVIDEND POLICY

To date, the Company has not paid any dividends on its outstanding Common Shares
and has no current intention to declare dividends on its Common Shares in the
foreseeable future. Any decision to pay dividends on its Common Shares in the
future will be dependent upon the financial requirements of the Company to
finance future growth, the financial condition of the Company and other factors
which the board of directors of the Company may consider appropriate in the
circumstances.


                                       48
<PAGE>

B. SIGNIFICANT CHANGES

There have been no significant changes in the business or affairs or financial
condition of the Company since September 30, 2000, the date of the annual
financial statements incorporated into this Form 20-F, except that during
January 2001, due to its current cash position the Company elected to cancel its
working capital loan agreement with Wells Fargo Bank, NA.


ITEM 9. THE OFFER AND LISTING


A. OFFER AND LISTING DETAILS

See "Markets" below.


B. PLAN OF DISTRIBUTION

Not applicable.

C. MARKETS

The common shares of the Company are currently listed on The Toronto Stock
Exchange in Canada. The Company's common shares commenced trading on The Toronto
Stock Exchange on May 16, 1997. The following table sets forth the high and low
closing prices and the volume of the common shares traded on The Toronto Stock
Exchange during the periods indicated:


                               TRADING INFORMATION

<Table>
<Caption>
           PERIOD                       HIGH        LOW           VOLUME
           ------                     -------     -------         ------
                                       (Cdn$)      (Cdn$)
<S>                                   <C>         <C>          <C>
May 16, 1997-September 30, 1997        1.50        0.96        27,131,433
October 1, 1997-September 30, 1998     1.45        0.38        40,323,218
October 1, 1998-September 30, 1999     0.72        0.22        19,512,089
October 1, 1999-September 30, 2000     0.38        0.13        19,626,816
October-December 1998                  0.59        0.38         9,458,410
January-March 1999                     0.72        0.44         4,522,095
April-June 1999                        0.53        0.26         2,280,235
July-September 1999                    0.37        0.22         3,226,428
October-December 1999                  0.32        0.19         2,760,819
January-March 2000                     0.28        0.13         4,938,370
April-June 2000                        0.25        0.18         3,596,256
July-September 2000                    0.38        0.17         7,823,205
October-December 2000                  0.35        0.21         5,750,566
August 2000                            0.25        0.18         1,479,605
September 2000                         0.38        0.21         1,360,050
October 2000                           0.35        0.30           791,536
November 2000                          0.32        0.26           624,750
December 2000                          0.27        0.21         4,334,280
January  2001                          0.34        0.26         1,546,892
February 2001                          0.31        0.25           326,200
</Table>


                                       49
<PAGE>

CURRENCY TRANSLATION

As the Company's stock is traded in Canadian dollars, the following table sets
forth the exchange rates for one Canadian dollar expressed in terms of one U.S.
dollar for the past five fiscal years and the calendar quarters ended 12/31/99,
3/31/00, 6/30/00, 9/30/00 and December 31, 2000:


                              EXCHANGE RATES-ANNUAL

<Table>
<Caption>
        YEAR               AVERAGE       LOW - HIGH            SEPTEMBER 30
        ----               -------       ----------            ------------
<S>                        <C>         <C>                     <C>
        1996                0.7329     0.7235 - 0.7513            0.7301
        1997                0.7221     0.6947 - 0.7483            0.7236
        1998                0.6898     0.6321 - 0.7292            0.6533
        1999                0.6681     0.6423 - 0.6912            0.6812
        2000                0.6735     0.6422 - 0.6970            0.6653
</Table>


                            EXCHANGE RATES-QUARTERLY

<Table>
<Caption>
CALENDAR QUARTER ENDED     AVERAGE         LOW-HIGH        LAST DAY OF QUARTER
----------------------     -------         --------        -------------------
<S>                        <C>         <C>                 <C>
      12/31/99              0.6795     0.6693 - 0.6915            0.6915
      03/31/00              0.6882     0.6787 - 0.6970            0.6902
      06/30/00              0.6755     0.6627 - 0.6898            0.6755
      09/30/00              0.6750     0.6653 - 0.6826            0.6653
      12/31/00              0.6554     0.6422 - 0.6693            0.6671
</Table>


The noon rate of exchange for the conversion of United States dollars into
Canadian dollars on February 28, 2001 was $0.6540 (Cdn.$1.00 = U.S.$0.6540).


ITEM 10. ADDITIONAL INFORMATION


A. SHARE CAPITAL

Not applicable.


B. MEMORANDUM AND ARTICLES OF ASSOCIATION

OBJECTS AND PURPOSES OF THE COMPANY

The Company was incorporated by Articles of Amalgamation under the Ontario
Business Corporations Act (the "OBCA") on May 9, 1997, under Incorporation
Number 1236943.

Section 15 of the OBCA provides that a corporation incorporated under the OBCA
has the capacity and the rights, powers and privileges of a natural person.
Neither the Articles of Amalgamation nor the By-Laws of the Company contain any
further objects or purposes or restrict the Company from carrying on any
business or from exercising any of its powers.

INTERESTED DIRECTORS

Section 3.18 of the Company's By-Laws provides that a director or officer who is
a party to, or who is a director or officer of or has a material interest in any
person who is a party to, a material contract or transaction or proposed
material contract or transaction with the Company shall disclose in writing to
the Company or request to have entered in the minutes of the meetings of the
directors the nature and extent of his interest at the time and in the manner
provided by the OBCA. Any such contract or transaction or proposed contract or
transaction shall be referred to the Board or shareholders for approval even if
such contract is one that in the ordinary course of the


                                       50
<PAGE>


Company's business would not require approval by the Board or shareholders, and
a director interested in a contract so referred to the Board shall not vote on
any resolution to approve the same except as permitted by the OBCA. Section
132(5) of the OBCA provides that such a director shall not vote on any
resolution to approve the contract or transaction unless the contract or
transaction is:

         o        An arrangement by way of security for money lent to or
                  obligations undertaken by the director for the benefit of the
                  Company or an affiliate;

         o        One relating primarily to his or her remuneration as a
                  director, officer, employee or agent of the Company or an
                  affiliate;

         o        One for indemnity or insurance under Section 136 of the OBCA;
                  or

         o        One with an affiliate.

There is no requirement in the OBCA or in the Company's Articles of Amalgamation
or By-Laws restricting the directors from voting compensation to themselves or
any members of their body, whether in the absence of an independent quorum or
otherwise.

BORROWING POWERS

Article 10 of the Articles of Amalgamation of the Company provides that the
Board may from time to time, without authorization of the shareholders, in such
amounts and on such terms as it deems expedient:

         o        Borrow money upon the credit of the Company;

         o        Issue, re-issue, sell or pledge debt obligations of the
                  Company;

         o        Subject to the provisions of the OBCA, give a guarantee on
                  behalf of the Company to secure performance of an obligation
                  of any person; and

         o        Mortgage, hypothecate, pledge or otherwise create a security
                  interest in all or any property of the Company owned or
                  subsequently acquired, to secure any obligation of the
                  Company.

Article 10 also provides that the Board may from time to time delegate to a
director, a committee of directors or an officer of the Company any or all of
the powers conferred on the Board as set out above, to such extent and in such
manner as the Board shall determine at the time of such delegation.

As these borrowing powers are contained in the Articles of Amalgamation, any
changes to the borrowing powers would require a special resolution of two-thirds
of the shareholders of the Company.

MANDATORY REQUIREMENT AND SHARE QUALIFICATION FOR DIRECTORS

There is no requirement for retirement of directors under an age limit
requirement, and there is no number of shares required for a director's
qualification.

ATTRIBUTES OF COMMON SHARES

The following is a summary of the principal attributes of the Company's Common
Shares:


         o        VOTING RIGHTS. The holders of the Common Shares are entitled
                  to receive notice of, attend and vote at any meeting of the
                  shareholders of the Company. The Common Shares carry one vote
                  per share. There are no cumulative voting rights, and
                  directors do not stand for re-election at staggered intervals.

         o        DIVIDENDS. The holders of common Shares are entitled to
                  receive on a pro-rata basis such dividends as may be declared
                  by the Board, out of funds legally available therefor. Any
                  dividend unclaimed after a


                                       51
<PAGE>


                  period of six years from the date on which the same has been
                  declared to be payable shall be forfeited and shall revert to
                  the Company.

         o        PROFITS. Each Common Share is entitled to share pro-rata in
                  any profits of the Company to the extent they are distributed
                  either through the declaration of dividends or otherwise
                  distributed to shareholders, or on a winding up or
                  liquidation.

         o        RIGHTS ON DISSOLUTION. In the event of the liquidation,
                  dissolution or winding up of the Company, the holders of the
                  Common Shares will be entitled to receive on a pro-rata basis
                  all of the assets of the Company remaining after payment of
                  all the Company's liabilities.

         o        PRE-EMPTIVE, CONVERSION AND OTHER RIGHTS. No pre-emptive,
                  redemption, sinking fund or conversion rights are attached to
                  the Common Shares, and the Common Shares, when fully paid,
                  will not be liable to further call or assessment. No other
                  class of shares may be created without the approval of the
                  holders of Common Shares. There are no provisions
                  discriminating against any existing or prospective holder of
                  Common Shares as a result of such shareholder owning a
                  substantial number of shares.

The rights of holders of Common Shares may only be changed by a special
resolution of holders of two-thirds of the issued and outstanding Common Shares,
in accordance with the requirements of the OBCA.

ANNUAL AND SPECIAL MEETINGS

The annual meeting of shareholders shall be held at such time in each year as
the Board, the Chairman of the Board (if any) or the President may from time to
time determine, for the purpose of considering the financial statements and
reports required by the OBCA to be placed before the annual meeting, electing
directors, appointing an auditor and for the transaction of such other business
as may properly be brought before the meeting. The Board, the Chairman of the
Board (if any) or the President shall have the power to call a special meeting
of shareholders at any time. In addition, Section 105 of the OBCA provides that
in certain circumstances the holders of not less than 5 percent of the issued
shares of a corporation that carry the right to vote at a meeting sought to be
held may requisition the directors to call a meeting of shareholders for the
purposes stated in the requisition.

The only persons entitled to be present at a meeting of shareholders are those
entitled to vote thereat, the directors and the auditor of the Company and
others who, although not entitled to vote are entitled or required under any
provision of the OBCA or the Articles of Amalgamation or By-Laws of the Company
to be present at the meeting. Any other person may be admitted only on the
invitation of the chairman of the meeting or with the consent of the meeting.

LIMITATIONS ON THE RIGHT TO OWN SECURITIES

There are no limitations on the rights to own securities, including the rights
of non-resident or foreign shareholders to hold or exercise voting rights on the
securities imposed by foreign law or by the charter or other constituent
document of the Company, except as discussed under "Exchange Controls" below.

CHANGES IN CONTROL

There are no provisions in the Company's Articles of Amalgamation or By-Laws
that would have an effect of delaying, deferring or preventing a change in
control of the Company and that would operate only with respect to a merger,
acquisition or corporate restructuring involving the Company (or any of its
subsidiaries).

DISCLOSURE OF OWNERSHIP

There are no provisions in the Company's Articles of Amalgamation or By-Laws
governing the ownership threshold above which shareholder ownership must be
disclosed. However, as discussed under "Exchange Controls" below, non-Canadians
may be required in certain circumstances to report their ownership interests in
the Company. In addition, the Ontario Securities Act requires disclosure by any
person acquiring or holding 10 percent or more of the outstanding Common Shares
of the Company.


                                       52
<PAGE>


C. MATERIAL CONTRACTS

The Company has not entered into any material contracts, other than in the
ordinary course of business during the previous two years.


D. EXCHANGE CONTROLS

Canada has no system of exchange controls. There are no foreign exchange
restrictions on the export or import of capital, including the availability of
cash and cash equivalents for use by the Company group, or on the remittance of
dividends, interest, or other payments to non-resident holders of the Company's
securities.

The Company is subject to the Investment Canada Act. Under the Investment Canada
Act, the acquisition of "control" of certain "businesses" by "non-Canadians" is
subject to either notification or review requirements by Investment Canada , a
governmental agency, and where review is required, will not be allowed unless
they are found likely to be of net benefit to Canada. The term "control" is
defined as any one or more non-Canadian persons acquiring all or substantially
all of the assets used in the Canadian business, or acquisition of the voting
shares of a Canadian corporation carrying on the Canadian business or the
acquisition of the voting interests of an entity controlling the Canadian
corporation. The acquisition of the majority of the outstanding shares or the
acquisition of less than a majority but 1/3 or more of the voting shares unless
it can be shown in fact that the purchaser will not control the Canadian
company, shall be deemed to be "control".

An acquisition will be reviewable by Investment Canada only if the value of the
assets of the Canadian business being acquired is Cdn$5 million or more in the
case of a "direct" acquisition (or where the Canadian asset acquired constitute
more than 50% of the value of all entities acquired), or Cdn$50 million or more
in the case of an "indirect" acquisition.

These thresholds have been increased for the purpose of acquisition of Canadian
businesses by investors from members of the World Trade Organization ("WTO"),
including Americans, or WTO member-controlled companies. A direct acquisition by
a WTO investor is reviewable only if it involves the direct acquisition of a
Canadian business with assets, and as of March 30, 2001, of Cdn$209 million or
more (this figure is adjusted annually to reflect inflation). Indirect
acquisitions by WTO investors are not reviewable, regardless of the size of the
Canadian business acquired, unless the Canadian, assets acquired constitute more
than 50% of the value of all entities acquired, in which case the Cdn$209
million threshold applies.

These increased thresholds do not apply to acquisitions of Canadian businesses
engaged in certain sensitive areas such as uranium production, financial
services, transportation or cultural heritage or national identity. If the
forgoing thresholds are not met, the acquisition of a Canadian business will not
be subject to review unless it relates to Canada's cultural heritage or national
identity.

If an investment is reviewable, an application for review in the form prescribed
by regulation is normally required to be filed with the Agency (established by
the Act) prior to the investment taking place and the investment may not be
consummated until the review has been completed. There are, however, certain
exceptions. Applications concerning indirect acquisitions may be filed up to 30
days after the investment is consummated; applications concerning reviewable
investments in culture-sensitive sectors are required upon receipt of a notice
for review.

There is, moreover, provision for the Minister (a person designated as such
under the Act) to permit an investment to be consummated prior to completion of
review if he is satisfied that delay would cause undue hardship to the acquirer
or jeopardize the operation of the Canadian business that is being acquired. The
Agency will submit the application to the Minister, together with any other
information or written undertakings given by the acquirer and any representation
submitted to the Agency by a province that is likely to be significantly
affected by the investment.

The Minister will then determine whether the investment is likely to be of net
benefit to Canada, taking into account the information provided and having
regard to factors of assessment where they are relevant. Some of the factors to
be considered are the effect of the investment on the level and nature of
economic activity in Canada, including the effect on employment, on resource
processing on the utilization of parts, components and services produced in


                                       53
<PAGE>


Canada, and on exports from Canada. Additional factors of assessment include:
(i) the degree and significance of participation by Canadians in the Canadian
business and in any industry in Canada of which it forms a part; (ii) the effect
of the investment on productivity, industrial efficiency, technological
development, product innovation and product variety in Canada; (iii) the effect
of the investment on competition within any industry or industries in Canada;
(iv) the compatibility of the investment with national industrial, economic and
cultural policies taking into consideration industrial, economic and cultural
policy objectives enunciated by the government or legislature of any province
likely to be significantly affected by the investment; and (v) the contribution
of the investment to Canada's ability to compete in world markets.

If an acquisition of control of a Canadian business by a non-Canadian is not
reviewable, the non-Canadian must still give notice to Investment Canada of the
acquisition of a Canadian business within 30 days after its completion.

There are no limitations under Canadian law on the right of nonresident or
foreign owners to hold or vote the common stock of the Company.


E. TAXATION

The following paragraphs set forth United States and Canadian income tax
considerations about the ownership of common shares of the Company, as of March
30, 2001. There may be relevant state, provincial or local income tax
considerations, which are not discussed.

                  UNITED STATES FEDERAL INCOME TAX CONSEQUENCES

The following is a discussion of possible United States federal income tax
consequences, under current law as of March 30, 2001, applicable to a U.S.
Holder (as defined below) of common shares of the Company. This discussion does
not address consequences peculiar to persons subject to special provisions of
federal income tax law, such as those described below as excluded from the
definition of a U.S. Holder. In addition, this discussion does not cover any
state, local or foreign tax consequences. (See "Taxation -- Certain Canadian
Federal Tax Considerations" below.)

The following discussion is based upon the sections of the Internal Revenue Code
of 1986, as amended (the "Code"), Internal Revenue Service ("IRS") rulings,
published administrative positions of the IRS and court decisions that are
applicable as of March 30, 2001, any or all of which could be materially and
adversely changed, possibly on a retroactive basis, at any time. This discussion
does not consider the potential effects, both adverse and beneficial, of any
recently proposed legislation which, if enacted, could be applied, possibly on a
retroactive basis, at any time. Accordingly, holders and prospective holders of
common shares of the Company are urged to consult their own tax advisors about
the state, and local tax consequences of purchasing, owning and disposing of
common shares of the Company.

U.S. HOLDERS

As used herein, a "U.S. Holder" means a holder of common shares of the Company
who is a citizen or individual resident of the United States, a corporation or
partnership created or organized in or under the laws of the United States or of
any political subdivision thereof or a trust whose income is taxable in the
United States irrespective of source. This summary does not address the tax
consequences to, and U.S. Holder does not include persons subject to specific
provisions of federal income tax law, such as tax-exempt organizations,
qualified retirement plans, individual retirement accounts and other
tax-deferred accounts, financial institutions, insurance companies, real estate
investment trusts, regulated investment companies, broker-dealers, non-resident
alien individuals, persons or entities that have a "functional currency" other
than the U.S. dollar, shareholders who hold common shares as part of a straddle,
hedging or a conversion transaction, and shareholders who acquired their stock
through the exercise of employee stock options or otherwise as compensation for
services. This summary is limited to U.S. Holders who own common shares as
capital assets. This summary does not address the consequences to a person or
entity holding an interest in a shareholder or the consequences to a person of
the ownership exercise or disposition of any options, warrants or other rights
to acquire common shares.


                                       54
<PAGE>


DISTRIBUTIONS ON COMMON SHARES OF THE COMPANY

U.S. Holders receiving dividend distributions (including constructive dividends)
with respect to common shares of the Company are required to include in gross
income for United States federal income tax purposes the gross amount of such
distributions equal to the U.S. dollar value of such dividends on the date of
receipt (based on the exchange rate on such date) to the extent that the Company
has current or accumulated earnings and profits, without reduction for any
Canadian income tax withheld from such distributions. Such Canadian tax withheld
may be credited, subject to certain limitations, against the U.S. Holder's
United States federal income tax liability or, alternatively, may be deducted in
computing the U.S. Holder's United States federal taxable income, but in the
case of an individual only applies to those who itemize deductions. (See
discussion that is more detailed at "Foreign Tax Credit" below.) To the extent
that distributions exceed current or accumulated earnings and profits of the
Company, they will be treated first as a return of capital up to the U.S.
Holders' adjusted basis in the common shares and thereafter as gain from the
sale or exchange of the common shares. Preferential tax rates for long-term
capital gains are applicable to a U.S. Holder which is an individual, estate or
trust. There are currently no preferential tax rates for long-term capital gains
for a U.S. Holder, which is a corporation.

In the case of foreign currency received as a dividend that is not converted by
the recipient into U.S. dollars on the date of receipt, a U.S. Holder will have
a tax basis in the foreign currency equal to its U.S. dollar value on the date
of receipt. Any gain or loss recognized upon a subsequent sale or other
disposition of the foreign currency, including an exchange for U.S. dollars,
will be ordinary income or loss.

Dividends paid on the common shares of the Company will not generally be
eligible for the dividends received deduction provided to corporations receiving
dividends from certain United States corporations. A U.S. Holder which is a
corporation may, under certain circumstances, be entitled to a 70% deduction of
the United States source portion of dividends received from the Company (unless
the Company qualifies as a "foreign personal holding Company" or a "passive
foreign investment company," as defined below) if such U.S. Holder owns shares
representing at least 10% of the voting power and value of the Company. The
availability of this deduction is subject to several complex limitations, which
are beyond the scope of this discussion.

FOREIGN TAX CREDIT

A U.S. Holder who pays (or has withheld from distributions) Canadian income tax
with respect to the ownership of common shares of the Company may be entitled,
at the option of the U.S. Holder, to either a deduction or a tax credit for such
foreign tax paid or withheld. Generally, it will be more advantageous to claim a
credit because a credit reduces United States federal income taxes on a
dollar-for-dollar basis, while a deduction merely reduces the taxpayer's income
subject to tax. This election is made on a year-by-year basis and applies to all
foreign taxes paid by (or withheld from) the U.S. Holder during that year. There
are significant and complex limitations which apply to the credit, among which
is the general limitation that the credit cannot exceed the proportionate share
of the U.S. Holder's United States income tax liability that the U.S. Holder's
foreign source income bears to his or its worldwide taxable income. In the
determination of the application of this limitation, the various items of income
and deduction must be classified into foreign and domestic sources. Complex
rules govern this classification process. In addition, this limitation is
calculated separately with respect to specific classes of income such as
"passive income", "high withholding tax interest", "financial services income",
"shipping income", and certain other classifications of income. Dividends
distributed by the Company will generally constitute "passive income" or, in the
case of certain U.S. Holders, "financial services income" for these purposes.
The availability of the foreign tax credit and the application of the
limitations on the credit are fact specific, and holders and prospective holders
of common shares of the Company should consult their own tax advisors regarding
their individual circumstances.

DISPOSITION OF COMMON SHARES OF THE COMPANY

A U.S. Holder will recognize gain or loss upon the sale of common shares of the
Company equal to the difference, if any, between (i) the amount of cash plus the
fair market value of any property received, and (ii) the shareholder's tax basis
in the common shares of the Company. This gain or loss will be capital gain or
loss if the common shares are a capital asset in the hands of the U.S. Holder,
which will be a short-term or long-term capital gain or loss depending upon the
holding period of the U.S. Holder. Gains and losses are netted and combined
according to special rules in arriving at the overall capital gain or loss for a
particular tax year. Deductions for net capital losses are subject to
significant limitations. For U.S. Holders who are individuals, any unused
portion of such net capital loss may be carried over to be used in later tax
years until such net capital loss is thereby exhausted. For U.S. Holders that
are corporations (other than corporations subject to Subchapter S of the Code),
an unused net capital

                                       55
<PAGE>


loss may be carried back three years from the loss year and carried forward five
years from the loss year to be offset against capital gains until such net
capital loss is thereby exhausted.

OTHER CONSIDERATIONS

In the following circumstances, the above sections of this discussion may not
describe the United States federal income tax consequences resulting from the
holding and disposition of common shares:

FOREIGN PERSONAL HOLDING COMPANY

If at any time during a taxable year more than 50% of the total combined voting
power or the total value of the Company's outstanding shares is owned, directly
or indirectly, by five or fewer individuals who are citizens or residents of the
United States and 60% or more of the Company's gross income for such year was
derived from certain passive sources (e.g., from dividends received from its
subsidiaries), the Company may be treated as a "foreign personal holding
Company". In that event, U.S. Holders that hold common shares would be required
to include in gross income for such year their allocable portions of such
passive income to the extent the Company does not actually distribute such
income.

FOREIGN INVESTMENT COMPANY

If 50% or more of the combined voting power or total value of the Company's
outstanding shares are held, directly or indirectly, by citizens or residents of
the United States, United States domestic partnerships or corporations, or
estates or trusts other than foreign estates or trusts (as defined by the Code
Section 7701 (a)(31)), and the Company is found to be engaged primarily in the
business of investing, reinvesting, or trading in securities, commodities, or
any interest therein, it is possible that the Company may be treated as a
"foreign investment company" as defined in Section 1246 of the Code, causing all
or part of any gain realized by a U.S. Holder selling or exchanging common
shares to be treated as ordinary income rather than capital gain.

PASSIVE FOREIGN INVESTMENT COMPANY

As a foreign corporation with U.S. Holders, the Company could potentially be
treated as a passive foreign investment company ("PFIC"), as defined in section
1296 of the Code, depending upon the percentage of the Company's income which is
passive, or the percentage of the Company's assets which is producing passive
income. U.S. Holders owning common shares of a PFIC are subject to an additional
tax and to an interest charge based on the value of deferral of tax for the
period during which the common shares of the PFIC are owned, in addition to
treatment of gain realized on the disposition of common shares of the PFIC as
ordinary income rather than capital gain. However, if the U.S. Holder makes a
timely election to treat a PFIC as a qualified electing fund ("QEF") with
respect to such shareholders interest therein, the above-described rules
generally will not apply. Instead, the electing U.S. Holder would include
annually in his gross income his pro rata share of the PFIC's ordinary earnings
and net capital gain regardless of whether such income or gain was actually
distributed. A U.S. Holder of a QEF can, however, elect to defer the payment of
United States federal income tax on such income not currently received subject
to an interest charge on the deferred tax. Alternatively, a U.S. Holder may
elect to "mark to market" his or her shares in the Company at the end of each
year as set forth in Section 1296 of the Code. Special rules apply to U.S.
Holders who own their interests in a PFIC through intermediate entities or
persons.

The Company believes that it was not a PFIC for its fiscal year ended September
30, 1997, and quarters ended December 31, 1997 and March 31, 1998. If in a
subsequent year the Company concludes that it is a PFIC, it intends to make
information available to enable an U.S. Holder to make a QEF election in that
year. There can be no assurance that the Company's determination concerning its
PFIC status will not be challenged by the IRS, or that it will be able to
satisfy record keeping requirements which will be imposed on QEF's.

CONTROLLED FOREIGN CORPORATION

If more than 50% of the voting power of all classes of stock or the total value
of the stock of the Company is owned, directly or indirectly, by citizens or
residents of the United States, United States domestic partnerships and
corporations or estates or trusts other than foreign estates or trusts, each of
whom own 10% or more of the total combined voting power of all classes of stock
of the Company ("United States shareholder"), the Company could be treated as a
"controlled foreign corporation" under Subpart F of the Code. This
classification would effect many



                                       56
<PAGE>


complex results including the required inclusion by such United States
shareholders in income of their pro-rata shares of "Subpart F income" (as
specially defined by the Code) of the Company. In addition, under Section 1248
of the Code, gain from the sale or exchange of stock by a holder of common
shares of the Company who is or was a United States shareholder at any time
during the five year period ending with the sale or exchange is treated as
ordinary dividend income to the extent of earnings and profits of the Company
attributable to the stock sold or exchanged. Because of the complexity of
subpart F and because it is not clear that Subpart F would apply to the holders
of common shares of the Company, a more detailed review of these rules is
outside of the scope of this discussion.

               CERTAIN CANADIAN FEDERAL INCOME TAX CONSIDERATIONS

The summary below, as of March 30, 2001, is restricted to the case of a holder
(a "Holder") of one or more common shares who for the purposes of the Income Tax
Act (Canada) (the "Act") is a non-resident of Canada, holds his common shares as
capital property and deals at arm's length with the Company.

DIVIDENDS

A Holder will be subject to Canadian withholding tax ("Part XIII Tax") equal to
25%, or such lower rate as may be available under an applicable tax treaty, of
the gross amount of any dividend paid or deemed to be paid on his common shares.
Under the Canada-U.S. Income Tax Convention (1980) (the "Treaty") the rate of
Part XIII Tax applicable to a dividend on common shares paid to a Holder who is
a resident of the United States is generally reduced to 15% of the gross amount
of the dividend or to 5% if the Holder is a company that beneficially owns at
least 10% of the voting stock of the Company. The Company will be required to
withhold the applicable amount of Part XIII Tax from each dividend so paid and
remit the withheld amount directly to the Receiver General for Canada for the
account of the Holder.

DISPOSITION OF COMMON SHARES

A Holder who disposes of a common share, including by deemed disposition on
death, will not be subject to Canadian tax on any capital gain (or capital loss)
thereby realized unless the common share constituted "taxable Canadian property"
as defined by the Act. Generally, a common share will not constitute taxable
Canadian property of a Holder unless he held the common share as capital
property used by him carrying on a business (other than an insurance business)
in Canada, or he or persons with whom he did not deal at arm's length alone or
together held or held options to acquire, at any time within the five years
preceding the disposition, 25% or more of the shares of any class of the capital
stock of the Company.

A Holder who is a resident of the United States and who realizes a capital gain
on a disposition of a common share that was taxable Canadian property will
nevertheless, by virtue of the Treaty, generally be exempt from Canadian tax
thereon unless (a) more than 50% of the value of the common share is derived
from, or for an interest in, Canadian real estate, including Canadian mineral
resource properties, (b) the common share formed part of the business property
of a permanent establishment that the Holder has or had in Canada within the 12
months preceding the disposition, or (c) the Holder (i) was a resident of Canada
at any time within the ten years immediately, and for a total of 120 months
during the 20 years, preceding the disposition, and (ii) owned the common share
when he ceased to be resident in Canada.

A Holder who is subject to Canadian tax in respect of a capital gain realized on
a disposition of a common share must include between one half and three quarters
of the capital gain (taxable capital gain) in computing his taxable income
earned in Canada depending on the date of disposition. The Holder may, subject
to certain limitations specified in the Act, deduct between one half and three
quarters of any capital loss (allowable capital loss) depending on the date of
disposition, arising on disposition of taxable Canadian property from taxable
capital gains realized in the year of disposition in respect to taxable Canadian
property and, to the extent not so deductible, from such taxable capital gains
of any of the three preceding years or any subsequent year.


F. DIVIDENDS AND PAYING AGENTS

Not applicable.


                                       57
<PAGE>


G. STATEMENT BY EXPERTS

Not applicable.


H. DOCUMENTS ON DISPLAY

The documents concerning the Company which are referred to in this Form 20-F may
be inspected during regular business hours at the offices of the Company's
subsidiary, International Uranium (USA) Corporation, at Suite 950, 1050 17th
Street, Denver, Colorado, 80265.


I. SUBSIDIARY INFORMATION

Not applicable.


ITEM 11. QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK

FOREIGN CURRENCY EXCHANGE RATE SENSITIVITY

The Company's functional currency is the U.S. dollar, and its activities are
predominantly executed using the U.S. dollar. The Company incurs a small portion
of its expenditures in Canadian and Mongolian currencies; however, it is not
subject to significant operational exposures due to fluctuations in those
currencies.

The Common shares of the Company are currently only listed on The Toronto Stock
Exchange in Canada and thus, the shares are purchased and sold in Canadian
dollars. Therefore, please refer to Item 9 for more information relating to the
Company's share price information and the tables relating to the U.S./Canadian
dollar currency translations.

The Company has not entered into any agreements or purchased any instruments to
hedge any possible currency risks at this time.

INTEREST RATE SENSITIVITY

The Company currently has no significant long-term or short-term debt requiring
interest payments. Thus, the Company has not entered into any agreement or
purchased any instrument to hedge against possible interest rate risks at this
time.

The Company's interest earning investments are primarily short-term, or can be
held to maturity, and thus, any reductions in carrying values due to future
interest rate declines are believed to be immaterial. However, as the Company
has a significant cash or near-cash position, which is invested in such
instruments, reductions in interest rates will reduce the interest income from
these investments.

COMMODITY PRICE SENSITIVITY

The Company can be subject to price risk due to changes in the market value of
uranium and vanadium regarding its future sales revenues and carrying values
relating to its finished goods, ore stockpiles and property holdings.

The Company has entered into future long-term contracts for uranium sales in the
past, thereby reducing its exposure to changes in uranium prices. However, the
Company has sold all of its uranium inventory and uranium supply contracts at
this time and has written off all of its uranium properties. As a result, only
future uranium production, which at this time is expected to be from alternate
feed materials, will be subject to uranium price fluctuations. To the extent
that any such future uranium production is expected to constitute a significant
portion of the Company's revenues, the Company will consider the possibility of
entering into future sales contracts for all or some of such future production.


                                       58
<PAGE>


The Company's finished goods inventories are recorded at the lower of cost or
net realizable value as of September 30, 2000. The Company currently has some
finished goods inventories of vanadium product.

The Company has not entered into any future vanadium sales contracts at this
time, and therefore its revenue and profits from vanadium sales are subject to
future price changes.


ITEM 12. DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES

Not applicable.


                                     PART II


ITEM 13. DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES

There have been no defaults, dividend arrearages or delinquencies.


ITEM 14. MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF
         PROCEEDS

There have been no modifications to securities of any class of the Company.


ITEM 15. [RESERVED]

Not applicable.


ITEM 16. [RESERVED]

Not applicable.


                                    PART III


ITEM 17. FINANCIAL STATEMENTS

See Pages F-1 through F-14 incorporated herein by reference.


ITEM 18. FINANCIAL STATEMENTS

Not applicable.



                                       59

<PAGE>



ITEM 19.  FINANCIAL STATEMENTS AND EXHIBITS

     a) The following consolidated statements, together with the report of
        PricewaterhouseCoopers LLP thereon, are filed as part of this 20-F:

<Table>
<Caption>
                                                                                        Page
                                                                                        ----
<S>                                                                                     <C>
        Index to Consolidated Financial Statements ....................................  F-i
        Auditors' Report to the Directors .............................................  F-1
        Consolidated Balance Sheets at September 30, 2000 and 1999 ....................  F-2
        Consolidated Statements of Operations and (Deficit) Retained Earnings
        For the Years Ended September 30, 2000, 1999 and 1998 .........................  F-3
        Consolidated Statements of Cash Flows for the Years Ended
        September 30, 2000, 1999 and 1998 .............................................  F-4
        Notes to the Consolidated Financial Statements ................................  F-6

        All other schedules are omitted because they are not applicable or because
        the required information is contained in the Consolidated Financial Statements
        or Notes thereto.

     b) Documents filed as exhibits to this Annual Report:

        Index to Exhibits ............................................................. F-16

        Exhibit 1.1 Company's Corporate Structure Chart ............................... F-17
</Table>


                                   SIGNATURES

Pursuant to the requirements of Section 12 of the Securities Exchange Act of
1934, the Company certifies that it meets all of the requirements for filing on
Form 20-F and has duly caused this Annual Report to be signed on its behalf by
the undersigned, thereunto duly authorized.


INTERNATIONAL URANIUM CORPORATION



By: /s/ David C. Frydenlund
    ---------------------------------------------------------------
    David C. Frydenlund, Vice President and Chief Financial Officer

Dated: April 9, 2002
       -------------



                                       60
<PAGE>

INDEX TO CONSOLIDATED FINANCIAL STATEMENTS

<Table>
<S>                                                                        <C>
Auditors' Report to the Directors ........................................ F-1

Consolidated Balance Sheets at September 30, 2000 and 1999 ............... F-2

Consolidated Statements of Operations and retained Earnings
     For Periods Ended September 30, 2000, 1999 and 1998 ................. F-3

Consolidated Statements of Cash Flows for the Periods Ended
     September 30, 2000, 1999 and 1998 ................................... F-4

Notes to the Consolidated Financial Statements ........................... F-6
</Table>


                                       F-i
<PAGE>


AUDITORS' REPORT TO THE DIRECTORS

We have audited the consolidated balance sheets of International Uranium
Corporation as at September 30, 2000, and 1999 and the consolidated statements
of operations and (deficit) retained earnings, and cash flows for each of the
years in the three year period ended September 30, 2000. These financial
statements are the responsibility of the Company's management. Our
responsibility is to express an opinion on these financial statements based on
our audits.

We conducted our audits in accordance with Canadian and United States generally
accepted auditing standards. Those standards require that we plan and perform an
audit to obtain reasonable assurance whether the financial statements are free
of material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation.

In our opinion, these consolidated financial statements present fairly, in all
material respects, the financial position of the Company as at September 30,
2000 and 1999, and the results of its operations and the changes in its cash
flow for each of the years in the three year period ended September 30, 2000, in
accordance with generally accepted accounting principles in Canada.


/s/ PricewaterhouseCoopers LLP
------------------------------
Chartered Accountants
Vancouver, Canada
November 24, 2000

                                      F-1
<PAGE>


                        INTERNATIONAL URANIUM CORPORATION
                           CONSOLIDATED BALANCE SHEETS
                             (UNITED STATES DOLLARS)

<Table>
<Caption>
                                                                  AT SEPTEMBER 30
                                                               2000              1999
                                                           ------------     ------------
<S>                                                        <C>              <C>
ASSETS
     Current assets:
     Cash and cash equivalents                             $ 11,650,600     $    469,407
     Trade and other receivables                              2,443,063        2,226,303
     Inventories (Note 3)                                     1,913,538       11,930,637
     Prepaid expenses and other                                 256,688          191,425
                                                           ------------     ------------
                                                             16,263,889       14,817,772

     Properties, plant and equipment, net (Note 4)            4,977,118        6,790,627
     Mongolia mineral properties (Note 5)                            --       10,484,299
     Notes receivable                                           200,088          202,016
     Restricted cash and marketable securities (Note 6)       8,870,989        9,344,541
     Other asset (Note 7)                                     2,840,000        4,248,875
     Goodwill and other, net                                         --            3,679
                                                           ------------     ------------
                                                           $ 33,152,084     $ 45,891,809
                                                           ============     ============
LIABILITIES
     Current liabilities:
     Accounts payable and accrued liabilities              $    656,051     $  2,132,614
     Notes payable (Note 8)                                      15,830        1,049,493
     Deferred revenue                                         5,036,003               --
                                                           ------------     ------------
                                                              5,707,884        3,182,107

     Notes payable, net of current portion                       54,607           22,811
     Reclamation obligations (Note 9)                        12,192,494       13,265,700
     Deferred revenue                                         4,244,000        3,123,441
     Deferred credit (Note 7)                                 4,220,000        4,320,000
                                                           ------------     ------------
                                                             26,418,985       23,914,059
                                                           ------------     ------------
SHAREHOLDERS' EQUITY
     Share capital (Note 10)                                 37,439,402       37,439,402
     65,525,066 shares issued and outstanding
     Deficit                                                (30,706,303)     (15,461,652)
                                                           ------------     ------------
                                                              6,733,099       21,977,750
                                                           ------------     ------------
                                                           $ 33,152,084     $ 45,891,809
                                                           ============     ============

</Table>

Contingency (Note 14)
The accompanying notes are an integral part of these financial statements.

                                      F-2
<PAGE>


                        INTERNATIONAL URANIUM CORPORATION
      CONSOLIDATED STATEMENTS OF OPERATIONS AND (DEFICIT) RETAINED EARNINGS
                             (UNITED STATES DOLLARS)

<Table>
<Caption>
                                                                        YEARS ENDED SEPTEMBER 30
                                                                2000            1999             1998
                                                           ------------     ------------     ------------
<S>                                                        <C>              <C>              <C>
OPERATIONS
Revenue
     Uranium sales                                         $ 12,810,100     $  9,611,450     $ 19,890,300
     Vanadium sales                                           2,415,588          146,867               --
     Process milling                                            834,484        4,288,515       13,050,576
                                                           ------------     ------------     ------------
     Total revenue                                           16,060,172       14,046,832       32,940,876
                                                           ------------     ------------     ------------
Costs and expenses
     Uranium cost of sales                                   10,637,373        8,237,348       17,829,592
     Vanadium cost of sales                                   2,006,136          150,519               --
     Process milling expenditures                               489,778        2,502,154       10,066,538
     Mill standby expenditures                                2,144,984        1,059,794               --
     Selling, general and administrative                      4,044,761        4,445,190        3,580,149
     Write-down of inventories (Note 3)                       1,026,415        7,709,170               --
     Write-down of other asset and deferred credit, net       1,308,875               --               --
     (Note 7)
     Depreciation                                               470,621          316,474          734,267
                                                           ------------     ------------     ------------
                                                             22,128,943       24,420,649       32,210,546
                                                           ------------     ------------     ------------

(Loss) income before the following                           (6,068,771)     (10,373,817)         730,330

     Decrease in reclamation obligations                      1,073,206               --               --
     Write-off of Mongolia mineral properties (Note 5)      (10,963,248)              --               --
     Write-off of mineral properties (Note 4)                        --       (7,039,958)              --
     Write-off of goodwill                                           --         (541,641)              --
     Net interest and other income                              714,162          857,739        1,128,562
                                                           ------------     ------------     ------------
(Loss) net income before taxes                              (15,244,651)     (17,097,677)       1,858,892

     Provision for income taxes                                      --               --          241,561
                                                           ------------     ------------     ------------
(LOSS) NET INCOME FOR THE YEAR                              (15,244,651)     (17,097,677)       1,617,331
                                                           ============     ============     ============

Basic/diluted (loss) income per common share               $      (0.23)    $      (0.26)    $       0.02
                                                           ============     ============     ============

(DEFICIT) RETAINED EARNINGS
(Deficit) retained earnings, beginning of year              (15,461,652)       1,636,025           18,694
     (Loss) net income for the year                         (15,244,651)     (17,097,677)       1,617,331
                                                           ------------     ------------     ------------
(DEFICIT) RETAINED EARNINGS, END OF YEAR                   $(30,706,303)    $(15,461,652)    $  1,636,025
                                                           ============     ============     ============
</Table>

The accompanying notes are an integral part of these financial statements.


                                      F-3
<PAGE>


                        INTERNATIONAL URANIUM CORPORATION
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
                             (UNITED STATES DOLLARS)

<Table>
<Caption>
                                                                        YEARS ENDED SEPTEMBER 30
                                                                 2000             1999            1998
                                                             ------------     ------------     ------------
<S>                                                          <C>              <C>              <C>
CASH PROVIDED BY (USED IN)

OPERATING ACTIVITIES
(Loss) net income for the year                               $(15,244,651)    $(17,097,677)    $  1,617,331
Items not affecting cash
     Depreciation and amortization                              1,094,376          664,633          734,267
     Loss (gain) on sale of land and equipment                      4,675         (168,141)         (99,865)
     Amortization of uranium sales contract purchase cost              --          729,730        1,270,270
     Write-down of inventories                                  1,026,415        7,709,170               --
     Write-down of other asset and deferred credit              1,308,875               --               --
     Write-off of Mongolia mineral properties                  10,963,248               --               --
     Write-off of mineral properties                                   --        7,039,958               --
     Write-off of goodwill                                             --          541,641               --
     Change in reclamation liabilities                         (1,073,206)              --               --
                                                             ------------     ------------     ------------
                                                               (1,920,268)        (580,686)       3,522,003

Changes in non-cash working capital items
     Decrease in marketable securities                                 --           11,731           28,247
     (Increase) decrease in trade and other receivables          (216,761)         753,297       (2,916,402)
     Decrease (increase) in inventories                         9,211,253      (10,490,259)      (2,019,516)
     (Increase) decrease in other current assets                  (96,836)         (35,568)         242,053
     Decrease in liability for inventory purchases                     --               --       (5,050,000)
     (Decrease) increase in other accounts payable and
     accrued liabilities                                       (1,476,562)         370,773          799,976
     Decrease in due to related parties                                --               --         (150,399)
                                                             ------------     ------------     ------------
     NET CASH PROVIDED BY (USED IN) OPERATIONS                  5,500,826       (9,970,712)      (5,544,038)
                                                             ------------     ------------     ------------

INVESTING ACTIVITIES
     Plant and equipment                                         (244,957)      (2,057,178)      (3,812,556)
     Mongolia mineral properties                                 (332,063)        (912,990)      (3,209,363)
     Proceeds from sale of surplus equipment                      627,211          322,660          102,310
     Collection of notes receivable                                 1,928            1,522        4,794,117
     Decrease (increase) in restricted marketable
     securities                                                   473,552       (1,044,166)        (355,020)
                                                             ------------     ------------     ------------
     NET CASH PROVIDED BY (USED IN) INVESTMENT
     ACTIVITIES                                                   525,671       (3,690,152)      (2,480,512)
                                                             ------------     ------------     ------------

FINANCING ACTIVITIES
     Stock purchased for retirement                                    --               --          (74,595)
     (Decrease) increase in notes payable                      (1,001,866)         980,166           62,639
     Increase in deferred credit                                       --        4,320,000               --
     Increase in deferred revenue                               6,156,562        2,547,830          365,426
                                                             ------------     ------------     ------------
     NET CASH PROVIDED BY FINANCING ACTIVITIES                  5,154,696        7,847,996          353,470
                                                             ------------     ------------     ------------

Increase (decrease) in cash and cash equivalents               11,181,193       (5,812,868)      (7,671,080)
Cash and cash equivalents, beginning of year                      469,407        6,282,275       13,953,355
                                                             ------------     ------------     ------------
CASH AND CASH EQUIVALENTS, END OF YEAR                       $ 11,650,600     $    469,407     $  6,282,275
                                                             ============     ============     ============
</Table>

                                      F-4
<PAGE>


<Table>
<Caption>
                                                                        YEARS ENDED SEPTEMBER 30
                                                                 2000             1999            1998
                                                             ------------     ------------     ------------
<S>                                                          <C>              <C>              <C>
SUPPLEMENTARY CASH FLOW INFORMATION
Cash interest paid                                           $     53,641     $    113,523     $     29,515
Cash interest received                                       $    719,324     $    786,926     $  1,276,122

Non-cash investing and financing activities
Transfer of inventory to other asset                         $         --     $  4,248,875     $         --
</Table>


The accompanying notes are an integral part of these financial statements.


                                      F-5
<PAGE>


                   Notes to Consolidated Financial Statements
                        September 30, 2000, 1999 and 1998
                             (United States Dollars)

1. ORGANIZATION AND NATURE OF OPERATIONS

International Uranium Corporation and its subsidiaries (the "Company") is a
company engaged in the business of recycling uranium-bearing waste products,
referred to as "alternate feed materials," for the recovery of uranium, alone or
in combination with other metals, as an alternative to the direct disposal of
these waste products. Alternate feed materials are generally ores or residues
from other processing facilities that contain uranium in quantities or forms
that can be recovered at the Company's White Mesa uranium mill (the "Mill"),
located near Blanding Utah. The Company also owns several uranium and
uranium/vanadium mines and exploration properties that were placed on standby
during the 1999 fiscal year. In addition, the Company is engaged in the selling
of uranium recovered from these operations in the international nuclear fuel
market and also sells vanadium and other metals that can be produced as a
co-product with uranium.

2. SIGNIFICANT ACCOUNTING POLICIES

These consolidated financial statements have been prepared in accordance with
accounting principles generally accepted in Canada. Differences with respect to
United States generally accepted accounting principles are disclosed in Note 16.

a) Basis of consolidation

The consolidated financial statements include the accounts of the Company and
its wholly owned subsidiaries, International Uranium Holdings Corporation,
International Uranium Alberta Corporation, International Uranium (Bermuda I)
Ltd., International Uranium Company (Mongolia) Ltd., and International Uranium
(USA) Corporation.

b) Use of estimates

The preparation of consolidated financial statements in conformity with
generally accepted accounting principles requires the Company's management to
make estimates and assumptions that affect the amounts reported in these
financial statements and notes thereto. Actual results could differ from those
estimated.

c) Cash and cash equivalents

Cash and cash equivalents consist of cash on deposit and highly liquid
short-term interest bearing securities with maturities at the date of purchase
of three months or less.

d) Restricted cash and marketable securities

Restricted cash and marketable securities are valued at the lower of cost and
market value. Fixed income securities, which are to be held to maturity, are
recorded at amortized cost.

e) Inventories

Ore stockpiles, which consist of uranium and vanadium bearing ores from the
Company's mining operations; in-process inventories, which consist of partially
processed uranium and vanadium bearing ores, and uranium and vanadium
concentrates are valued at the lower of cost or net realizable value using the
first-in, first-out method. Consumable parts and supplies are valued at the
lower of weighted average cost or net realizable value.

f) Properties, plant and equipment

Mineral properties and plant and equipment are recorded at the lower of cost and
net realizable value. Mineral properties are depleted by the units-of-production
method based on ore reserves. Plant and equipment are


                                      F-6
<PAGE>


depreciated on a straight-line basis over their estimated useful lives from
three to fifteen years. Plant and equipment placed on stand-by are depreciated
over their remaining lives. Gains or losses from normal sales or retirements of
assets are included in other income or expense.

g) Exploration properties

Mineral exploration costs are capitalized as incurred. When it is determined
that a mineral property can be economically developed, the cost of the property
and the related exploration and development expenditures will be amortized using
the unit-of-production method over the estimated life of the ore body. If a
project is unsuccessful, the mining property and the related exploration
expenditures are written off.

h) Asset impairment

The Company reviews and evaluates its long-lived assets for impairment when
events or changes in circumstances indicate that the related carrying amounts
may not be recoverable. An impairment loss is measured as the amount by which
asset-carrying value exceeds fair valueFair value is generally determined using
estimated future cash flow analysis. An impairment is considered to exist if
total estimated future cash flows on an undiscounted basis are less than the
carrying amount of the asset. An impairment loss is measured and recorded based
on undiscounted estimated future cash flows. Future cash flows are determined by
subtracting production, capital and reclamation costs from estimated revenues.
Estimated revenues are based on estimated uranium and vanadium prices
(considering current and historical prices, price trends and related factors)
and estimates of the pounds of uranium and vanadium to be produced. Assumptions
underlying future cash flow estimates are subject to risks and uncertainties.
Any differences between significant assumptions and actual market conditions
and/or the Company's performance could have a material effect on the Company's
financial position and results of operations.

i) Environmental protection and reclamation costs

The estimated reclamation liabilities for the Mill, mines and any exploration
properties requiring reclamation are based on the greater of the bonded amount
for each property, as determined by applicable regulatory authorities, and an
engineering estimate, performed by the Company, of the work required to reclaim
the property.

Estimated future decommissioning and reclamation costs are based principally on
existing legal and regulatory requirements. Such costs related to the Mill are
accrued and charged over the expected operating life of the Mill using the
straight-line method. Future reclamation costs for inactive mines are accrued
based on management's best estimate at the end of each period of the
undiscounted costs expected to be incurred at a site. Such cost estimates
include, where applicable, ongoing care, maintenance and monitoring costs.
Changes in estimates are reflected in earnings in the period an estimate is
revised.

j) Foreign currency translation

These consolidated financial statements are denominated in United States
dollars, the Company's functional currency. Substantially all of the Company's
assets and operations are located in the United States, with the exception of
the Gurvan-Saihan Joint Venture (Note 5). The majority of its costs are
denominated in United States dollars and all of its products for sale are priced
in United States dollars.

Amounts denominated in foreign currencies are translated into United States
dollars as follows:

         a) Monetary assets and liabilities at the rates of exchange in effect
         at balance sheet dates;

         b) Non-monetary assets at historical rates;

         c) Revenue and expense items at the average rates for the period.

The net effect of the foreign currency translation is included in the statement
of earnings.

k) Earnings per share


                                      F-7
<PAGE>


Earnings per common share is determined using the weighted average number of
shares outstanding during the year, which for the years ending September 30,
2000 and 1999 was 65,525,066 shares.

l) Revenue recognition

In accordance with normal industry practices, the Company contracts for future
delivery of uranium produced. Sales revenue is recorded in the period that title
passes to the customer along with the risks and rewards of ownership. Sales of
the Company's uranium long-term supply contracts are included in uranium sales.

Process milling fees are recognized as the applicable material is processed, in
accordance with the specifics of the applicable processing agreements.

Deferred revenues represent processing proceeds received or receivable on
delivery of materials but in advance of the required processing activity.

m) Reclassifications

Certain amounts in prior years have been reclassified to conform to the 2000
presentation.

n) Share options

The Company has a share option plan which is described in Note 10. c). No
compensation expense is recognized when share options are issued or re-priced at
market value. Any consideration on exercise of share options is credited to
share capital.

3. INVENTORIES


<Table>
<Caption>
                        September 30, 2000   September 30, 1999
                        ------------------   ------------------
<S>                     <C>                 <C>
Vanadium Concentrates       $   837,869         $ 1,257,604
Uranium Concentrates                 --           8,583,323
Ore Stockpiles                       --             144,112
In Process                       20,450             569,499
Parts and Supplies            1,055,219           1,376,099
                            -----------         -----------
                            $ 1,913,538         $11,930,637
                            ===========         ===========
</Table>

In the current year, the Company wrote-down the carrying value of its finished
goods inventories to market value by $1,026,415. In the prior year, the Company
recorded a write-down of $7,709,170 relating to its ore stockpiles and
concentrate inventories.

4. PROPERTIES, PLANT AND EQUIPMENT

<Table>
<Caption>
                                                     Accumulated
                                                     Depreciation,
                                                      Depletion,
                                                     Amortization      Sept. 30, 2000
                                       Cost          and Write-Offs          Net
                                    -----------      --------------    --------------
<S>                                 <C>              <C>               <C>
Mill Buildings and Equipment        $ 6,501,912       $ 2,345,244       $ 4,156,668
Other Machinery and Equipment         1,779,346           958,896           820,450
Mineral Properties                    7,616,865         7,616,865                --
                                    -----------       -----------       -----------
                                    $15,898,123       $10,921,005       $ 4,977,118
                                    ===========       ===========       ===========
</Table>


                                      F-8
<PAGE>



<Table>
<Caption>
                                                   Accumulated
                                                   Depreciation,
                                                    Depletion,
                                                   Amortization      Sept. 30, 1999
                                     Cost          & Write-Offs          Net
                                  -----------      --------------    --------------
<S>                               <C>              <C>               <C>

Mill Buildings & Equipment        $ 6,438,203       $ 1,494,998       $ 4,943,205
Other Machinery & Equipment         2,645,798           798,376         1,847,422
Mineral Properties                  7,616,865         7,616,865                --
                                  -----------       -----------       -----------
                                  $16,700,866       $ 9,910,239       $ 6,790,627
                                  ===========       ===========       ===========
</Table>

In fiscal 1999, the Company recorded a write-off of $7,039,958 relating to its
U.S. mineral properties.

Under the terms of a Royalty Deed and subsequent amendments with certain Swiss
utilities the Company has made advance royalty payments on certain United States
mineral properties. During the period from January 1, 1998 through December 31,
2000 advance royalty payments of $250,000 were made each year. In June 2000, the
Company entered into a Termination Agreement, which cancelled all interests and
other rights granted to the Swiss utilities under the Royalty Deed and
subsequent amendments.

At September 30, 2000 and September 30, 1999 as a result of the shutdown of the
Company's mining operations, capital assets include other machinery and
equipment held for resale with and aggregate net book value (being the estimated
net realizable value) of $357,877 and $212,483, respectively. These surplus
assets are expected to be sold over time as opportunities for sale arise, and
the actual proceeds to be realized on the sale of the surplus assets could vary
from the carrying value.

5. MONGOLIA MINERAL PROPERTIES

Mongolia mineral properties are made up of the Company's 70% interest in the
Gurvan-Saihan Joint Venture (the "Venture") which holds eight uranium
exploration areas covering 3.2 million acres in central eastern Mongolia. The
other parties to the Venture are the Mongolian government as to 15% and
Geologorazvedka, a Russian geological concern, as to 15%. A royalty in the
amount of 4% is payable to the Mongolian government. The Company has
proportionately consolidated its 70% interest in the Venture, which is
substantially represented by Mongolian mineral properties. To date the Company
has funded all expenditures and expects to do so for the foreseeable future.

In fiscal 2000, as a result of continued deterioration in uranium prices and the
Company's decision to halt further exploration, the Company wrote-off its
investment in the Venture.

6. RESTRICTED CASH AND MARKETABLE SECURITIES

Amounts represent cash and marketable securities the Company has placed on
deposit to secure its reclamation bonds and certain other obligations (Notes 7
and 9).

<Table>
<Caption>
                            September 30, 2000   September 30, 1999
                            ------------------   ------------------
<S>                         <C>                  <C>
Cash and Cash Equivalents       $1,170,504           $2,512,567
Fixed Income Securities          7,700,485            6,831,974
                                ----------           ----------
                                $8,870,989           $9,344,541
                                ==========           ==========
</Table>

The fair value of restricted cash and marketable securities approximated
carrying value.

7. OTHER ASSET

On September 13, 1999 the Company entered into a uranium concentrates sale and
put option agreement with third party. The Company transferred 400,000 pounds
U3O8 at a purchase price of $10.80 per pound U3O8 under this agreement giving
the third party the option to put up to an equivalent quantity to the Company at
$10.55 per pound


                                      F-9
<PAGE>

U3O8 at any one time within the period beginning October 1, 2001, and ending
March 1, 2003. The transaction was accounted for as a deferred credit and the
cost of the inventory was reclassified as an other asset. A bond (Note 6)
secures a portion of the transaction.

In fiscal 2000, the Company wrote-down the carrying value of the other asset,
and the offsetting deferred credit, to reflect the change in market value of the
underlying inventory by a net $1,308,875.

8. NOTES PAYABLE

<Table>
<Caption>
                        September 30, 2000   September 30, 1999
                        ------------------   ------------------
<S>                     <C>                  <C>
Wells Fargo Bank, NA       $       --           $  950,000
Other                          15,830               99,493
                           ----------           ----------
                           $   15,830           $1,049,493
                           ==========           ==========
</Table>

During March 2000, the Company renewed its working capital loan agreement with
Wells Fargo Bank, NA. The principal amount was reduced from $10 million to $5
million and the maturity date was extended from March 31, 2000 to March 31,
2001. This facility provides for advances based on receivable levels and uranium
inventories provided certain financial covenants are maintained. The Company is
in the process of renegotiating this facility.

9. PROVISIONS FOR RECLAMATION

Estimated future decommissioning and reclamation costs of the Mill and mining
properties are based principally on legal and regulatory requirements. At
September 30, 2000 and September 30, 1999, $12,192,494 and $13,265,700,
respectively, were accrued for reclamation costs. The Company has posted bonds
in favor of the United States Nuclear Regulatory Commission and the applicable
state regulatory agencies as security for these liabilities and has deposited
marketable securities on account of these obligations (Note 6).

Elements of uncertainty in estimating reclamation and decommissioning costs
include potential changes in regulatory requirements, decommissioning and
reclamation alternatives. Actual costs will differ from those estimated and such
differences may be material.

10. SHARE CAPITAL

         a) Authorized - unlimited number of common shares.

         b) Issued and outstanding


                                      F-10
<PAGE>

<Table>
<Caption>
                 September 30, 2000   September 30, 1999   September 30, 1998
                 ------------------   ------------------   ------------------
<S>                  <C>                  <C>                   <C>
Number Issued        65,525,066           65,525,066            65,525,066
Amount              $37,439,402          $37,439,402           $37,439,402
                    ===========          ===========           ===========
</Table>

         c) Share options

The Company has adopted a share option plan under which the Board of Directors
may from time to time grant to directors, officers, key employees and
consultants of the Company, options to purchase shares of the Company's common
stock. These options are intended to advance the interests of the Company by
providing eligible persons with the opportunity, through share options, to
acquire an increased proprietary interest in the Company. Options granted under
the share option plan generally have an exercise price of the fair market value
of such shares on the date of grant. All outstanding options granted to date
vest immediately and expire three years from the date of the grant of the
option.

Share option transactions were as follows:

<Table>
<Caption>
                                       September 30, 2000            September 30, 1999             September 30, 1998
                                 ----------------------------   ----------------------------   ----------------------------
                                                  Weighted                       Weighted                      Weighted
                                                  Average                        Average                        Average
                                   Shares      Exercise Price     Shares      Exercise Price     Shares      Exercise Price
                                 ----------    --------------    ---------    --------------    ---------    --------------
<S>                              <C>           <C>               <C>          <C>               <C>          <C>
Outstanding, Beginning of Year    3,389,000       Cdn$1.03       2,814,000       Cdn$1.11      2,639,000        Cdn$1.11
Granted                           3,605,000       Cdn$0.24         900,000       Cdn$0.75        175,000        Cdn$1.11
Expired                          (2,714,000)      Cdn$1.10        (325,000)      Cdn$0.94             --              --
                                 ----------       --------       ---------       --------      ---------        --------
Outstanding, End of Year          4,280,000       Cdn$0.32       3,389,000       Cdn$1.03      2,814,000        Cdn$1.11
                                 ==========       ========       =========       ========      =========        ========
</Table>

The outstanding options expire between January 2002 and May 2003 and have a
weighted average remaining contractual life of 2.4 years.

11. INCOME TAXES

Non-capital loss carry forwards for Canadian tax purposes of approximately
$903,000 begin to expire in 2004. For U.S. income tax purposes, loss carry
forwards of approximately $4,500,000 begin to expire in 2015 unless utilized.
The benefits of these amounts have not been reflected in these consolidated
statements.

12. SEGMENTED INFORMATION

         a) Geographic information

<Table>
<Caption>
                                    September 30, 2000   September 30, 1999   September 30, 1998
                                    ------------------   ------------------   ------------------
<S>                                 <C>                  <C>                  <C>
Revenue
     Canada                            $         --          $         --          $         --
     United States                       16,060,172            14,046,832            32,940,876
     Mongolia                                    --                    --                    --
                                       ------------          ------------          ------------
                                       $ 16,060,172          $ 14,046,832          $ 32,940,876
                                       ============          ============          ============
Net Loss
     Canada                            $   (267,297)         $   (463,753)        $   (608,062)
     United States                       (3,983,443)          (16,580,589)           2,235,975
     Mongolia                           (10,993,911)              (53,335)             (10,582)
                                       ------------          ------------         ------------
                                       $(15,244,651)         $(17,097,677)        $  1,617,331
                                       ============          ============         ============
Property, Plant & Equipment, net
     Canada                            $         --          $         --         $         --
     United States                        4,720,792             6,357,892           12,966,199
     Mongolia                               256,323               432,735              550,738
                                       ------------          ------------         ------------
                                       $  4,977,118          $  6,790,627         $ 13,516,937
                                       ============          ============         ============
</Table>


                                      F-11
<PAGE>

         b) Major Customers

         The Company's business is such that, at any given time, it sells its
         uranium and vanadium concentrates to and enters into process milling
         arrangements with a relatively small number of customers. The customers
         with whom it does business vary substantially from year to year. During
         the year ended September 30, 2000, a uranium customer accounted for 51%
         of total revenues. Accounts receivable from any individual customer
         will exceed 10% of total accounts receivable on a regular basis.

13. RELATED PARTY TRANSACTIONS

         a) During the year ended September 30, 2000, the Company incurred legal
         fees of $16,606 with a law firm of which a partner is a director of the
         Company. Amounts due to this firm were $1,017 as of September 30, 2000.
         Legal fees incurred with this law firm were $12,524 for the year ended
         September 30, 1999, and $50,197 for the year ended September 30, 1998.

         b) During the year ended September 30, 2000, the Company incurred
         management and administrative service fees of $90,000 with a company
         owned by the Chairman of the Company which provides office premises,
         secretarial and other services in Vancouver. Management and
         administration fees of $94,108 were paid to this same company during
         the year ended September 30, 1999, and $99,383 for the year ended
         September 30, 1998.

         c) During the period ended September 30, 1997, the Company loaned
         $200,000 to an officer of the Company in order to facilitate relocation
         to the Company headquarters. This loan is non-interest bearing and is
         payable on the earlier of termination of employment or June 30, 2001.
         The loan is secured by the officer's personal residence.

         d) Subsequent to the retirement of Mr. Earl E. Hoellen as President and
         Chief Executive officer of the Company, a company controlled by Mr.
         Hoellen, a director of the Company, earned a commission of $59,516 in
         connection with the sale by the Company of its uranium inventories and
         sales contracts.

14. CONTINGENCY

The Company has detected some chloroform contamination at the Mill site that
appears to have resulted from the operation of a temporary laboratory facility
that was located at the site prior to and during the construction of the Mill
facility. The source and extent of this contamination are currently under
investigation, and a corrective action plan, if necessary, is yet to be devised.
Although the investigations to date indicate that this contamination appears to
be contained in a manageable area, the scope and costs of remediation have not
yet been determined and could be significant.

The Company is required to comply with environmental protection laws and
regulations and permitting requirements, and the Company anticipates that it
will be required to continue to do so in the future. Although the Company
believes that its operations are in compliance, in all material respects, with
all relevant permits, licenses and regulations involving worker health and
safety as well as the environment, the historical trend toward stricter
environmental regulation may continue. The uranium industry is subject to not
only the worker health and safety and environmental risks associated with all
mining businesses, but also to additional risks uniquely associated with uranium
mining and milling. The possibility of more stringent regulations exists in the
area of worker health and safety, the disposition of wastes, the decommissioning
and reclamation of mining and milling sites, and other environmental matters,
each of which could have a material adverse effect on the costs of reclamation
or the viability of the operations.

15. FINANCIAL INSTRUMENTS

As at September 30, 2000 and 1999, the fair value of the Company's financial
instruments approximates their carrying values because of the short-term nature
of these instruments and, where applicable, because interest rates approximate
market rates.


                                      F-12
<PAGE>

16. DIFFERENCES BETWEEN CANADIAN AND UNITED STATES ACCOUNTING PRINCIPLES AND
    PRACTICES

The consolidated financial statements have been prepared in accordance with
accounting principles and practices generally accepted in Canada (Canadian GAAP)
which differ in certain respects from those principles and practices tat the
Company would have followed had its consolidated financial statements been
prepared in accordance with accounting principles and practices generally
accepted in the United States (U.S. GAAP).



<Table>
<Caption>
                                                                               September 30    September 30
                                                                                   2000            1999
                                                                               ------------    ------------
<S>                                                                            <C>             <C>
CONSOLIDATED BALANCE SHEETS

Properties, plant and          Canadian Basis                                  $  4,977,118    $  6,790,627
equipment
                               Depreciation of assets held for resale(e)            223,234          15,772
                                                                               ------------    ------------
                               U.S. basis                                      $  5,200,352    $  6,806,399
                                                                               ============    ============

Mongolia mineral properties    Canadian basis                                  $         --    $ 10,484,299
                               Write-off of Mongolia Mineral Properties(a)               --      (4,802,289)
                               Exploration expenditures(b)                               --      (5,682,010)
                                                                               ------------    ------------
                               U.S. basis                                      $         --    $         --
                                                                               ============    ============

Notes receivable               Canadian Basis                                  $    200,088    $    202,016
                               Shareholder loan reclassification(c)                (200,000)       (200,000)
                                                                               ------------    ------------
                               U.S. basis                                      $         88    $      2,016
                                                                               ============    ============

Share capital                  Canadian basis                                  $ 37,439,402    $ 37,439,402
                               Shareholder loan reclassification(c)                (200,000)       (200,000)
                               Amalgamation(d)                                     (615,970)       (615,970)
                                                                               ------------    ------------
                               U.S. basis                                      $ 36,623,432    $ 36,623,432
                                                                               ============    ============

Retained earnings              Canadian basis                                  $(30,706,303)   $(15,461,652)
                               Write-off of Mongolia Mineral Properties(a)               --      (4,802,289)
                               Exploration expenditures(b)                               --      (5,682,010)

                               Goodwill(d)                                          615,970         615,970
                               Depreciation of assets held for resale(e)            223,234          15,772
                                                                               ------------    ------------
                               U.S. basis                                      $(29,867,099)   $(25,314,209)
                                                                               ============    ============
</Table>

<Table>
<Caption>
                                                                      September 30,       September 30,       September 30,
                                                                          2000                1999                1998
                                                                      ------------        ------------        ------------
<S>                                                                   <C>                 <C>                 <C>
CONSOLIDATED STATEMENTS OF EARNINGS

Net (loss) income under Canadian GAAP                                 $(15,244,651)       $(17,097,677)       $  1,617,331
Write-off of Mongolia
Mineral Properties                                                      10,963,248          (4,802,289)                 --
Write-off of mineral properties                                                 --           1,005,022                  --
Exploration expenditures                                                  (332,063)           (912,990)         (3,997,447)
Capitalized depreciation                                                  (146,886)            (70,377)                 --
</Table>



                                      F-13
<PAGE>

<Table>
<Caption>
                                                                      September 30,       September 30,       September 30,
                                                                          2000                1999                1998
                                                                      ------------        ------------        ------------
<S>                                                                   <C>                 <C>                 <C>
Goodwill                                                                        --             572,439              30,804
Depreciation of assets held for resale                                     207,462              15,772                  --
                                                                      ------------        ------------        ------------
Net loss under U.S. GAAP                                              $ (4,552,890)       $(21,290,100)       $ (2,349,312)
                                                                      ------------        ------------        ------------
Basic/diluted net loss per share, U.S. GAAP                           $      (0.07)       $      (0.32)       $      (0.04)
                                                                      ------------        ------------        ------------

CONSOLIDATED STATEMENTS OF CASH FLOWS

Cash provided by (used in) operations under Canadian GAAP             $  5,500,826        $ (9,970,712)       $ (5,544,038)
Exploration expenditures
                                                                          (332,063)           (912,990)         (3,997,447)
                                                                      ------------        ------------        ------------
Cash provided by (used in) operations under U.S. GAAP                 $  5,168,763        $(10,883,702)       $ (9,541,485)
                                                                      ------------        ------------        ------------


Cash provided by (used in) investing activities under
   Canadian GAAP                                                      $    525,671        $ (3,690,152)       $ (2,480,512)
Exploration expenditures                                                   332,063             912,990           3,997,447
                                                                      ------------        ------------        ------------
Cash provided by (used in) investing activities under U.S. GAAP       $    857,734        $ (2,777,162)       $  1,516,935
                                                                      ------------        ------------        ------------
</Table>


         a)       Under Canadian GAAP, the Company determined that the carrying
                  amount of its Mongolian mineral properties was not impaired at
                  September 30, 1999, based on an estimated resource of
                  approximately 22.5 million pounds of uranium. U.S. GAAP and
                  SEC rules requires the impairment analysis to be based on
                  proven or probable reserves, therefore the carrying amount of
                  the Mongolian mineral properties have been written off for
                  U.S. GAAP purposes.

         b)       Under Canadian GAAP, the Company defers the property holding
                  costs and ongoing exploration expenditures on properties still
                  in the exploration stage and carries these as assets until
                  the results of the exploration projects are known. If a
                  project is successful, the costs of the property and the
                  related exploration and development expenditures will be
                  amortized over the life of the property utilizing the
                  units-of-production method. If the Project is unsuccessful,
                  the mining property and the related exploration expenditures
                  net of any recoveries on disposition of the properties or
                  related assets are written off. Under U.S. GAAP, these costs
                  are expensed as incurred.

         c)       SEC practices require shareholder loans to be classified as a
                  deduction from shareholders' equity.

         d)       Under Canadian GAAP the amalgamation of the Company with
                  Thornbury has been accounted for as an acquisition of
                  Thornbury resulting in the recording of goodwill. Under U.S.
                  GAAP, the transaction has been accounted for as a
                  recapitalization whereby the net monetary assets of Thornbury
                  would be recorded as fair value, except that no good will or
                  other intangibles would be recorded. The good will recorded
                  under Canadian GAAP has been applied to reduce the share
                  capital of the Company under U.S. GAAP.

         e)       Under Canadian GAAP the Company's surplus assets continue to
                  be depreciated. Under U.S. GAAP assets held for resale are
                  recorded at the lower of cost or net realizable value and are
                  not depreciated.

         f)       Under U.S. GAAP, comprehensive loss consists of net loss only.

         g)       Under U.S. GAAP, the sub-total before changes in non-cash
                  working capital items in the consolidated statements of cash
                  flow would be deleted.


                                      F-14

<PAGE>


         h)       Under U.S. GAAP, write-offs of mineral properties and goodwill
                  and decreases in reclamation obligations would be included in
                  operating (loss) income in the consolidated statements of
                  operations and (deficit) retained earnings.

         i)       The Canadian Institute of Chartered Accountants recently
                  issued Sections 3461 - Employee Future Benefits, and 3465 -
                  Income Taxes, both of which are effective for fiscal years
                  beginning on or after January 1, 2000 and Section 3500 -
                  Earnings Per Share which is effective for fiscal years
                  beginning on or after January 1, 2001. The Financial
                  Accounting Standards Board recently issued FAS 133 on
                  Accounting for Derivative Instruments on Hedging Activities
                  which is effective for fiscal years beginning after June 15,
                  2000. The impact of the adoption of these standards is not
                  expected to be material.


                                      F-15
<PAGE>


                                Index to Exhibits

<Table>
<Caption>
EXHIBIT NUMBER                      DESCRIPTION
--------------                      -----------
<S>                   <C>
     1.1              Company's Corporate Structure Chart
</Table>


                                      F-16