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|ENERGY FUELS INC.                                                     
|----------------------------------------------------------------------
|Managements Discussion and Analysis                                  
|15 Months Ended December 31, 2013                                     
|(Expressed in
      thousands of U.S. Dollars, Unless Otherwise Noted)

INTRODUCTION

This Managements Discussion and Analysis (MD&A)
of Energy Fuels Inc. and its subsidiary companies (collectively, Energy
Fuels or the Company) provides a detailed analysis of the
Companys business and compares its financial results with those of the previous
year. This MD&A is dated as of March 26, 2014 and should be read in
conjunction with the Companys audited consolidated financial statements and
related notes for the 15 months ended December 31, 2013.In November 2013, the
Company announced a change in its fiscal year end from September 30 to
December 31. As a result of this change, the Companys annual 2013 results
include consolidatedfinancial statements for the 15 month period ended
December 31, 2013 (FY-2013), with comparative figures for the twelve
month period ended September 30, 2012 (FY-2012) and, accordingly, the
results shown are not fully comparable. The reason for this change was to better
align the Companys year-end with the year-ends of its major uranium customers,
certain material subsidiaries and industry peers.

Effective November 5, 2013, the Company completed a
consolidation of its common shares on the basis of 50 pre-consolidation common
shares for each post-consolidation common share. All share and per share amounts
in this MD&A are shown on a post consolidation basis.

This MD&A was written to comply with the requirements of
National Instrument 51-102  Continuous Disclosure Obligations. All financial
information in this discussion and analysis is presented in United States
dollars, unless otherwise stated.

Other continuous disclosure documents, including the Companys
press releases, quarterly and annual reports, technical reports, Annual
Information Form (AIF) and Form 40-F are available through its filings
with the securities regulatory authorities in Canada at
www.sedar.com (SEDAR) and in the United States at www.sec.gov/edgar.shtml
(EDGAR), and on the Companys website at www.energyfuels.com.

In this discussion, the terms Company, we, us, and our
refer to Energy Fuels and, as applicable, the Companys wholly-owned
subsidiaries: Energy Fuels Resources Corporation (EFRC), Energy Fuels
Holdings Corp. (previously known as Denison Mines Holdings Corp.)
(EFHC), White Canyon Uranium Limited (White Canyon), Magnum
Uranium Corp. (Magnum), Titan Uranium Inc. (Titan), Strathmore
Minerals Corp. (Strathmore) and their respective subsidiaries.

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING
STATEMENTS

This MD&A contains forward looking information and forward
looking statements within the meaning of applicable Canadian and United States
securities laws. Those statements appear in a number of places in this MD&A
and include, but are not limited to, statements and information regarding the
Companys current intent, belief or expectations primarily with respect to: the
Companys business objectives and plans; exploration and development plans and
expenditures; estimation of mineral resources and reserves; mineral grades;
Energy Fuels expectations regarding additions to its mineral reserves and
resources through acquisitions and development; success of the Company's
permitting efforts, including receipt of regulatory approvals, permits and
licenses and treatment under governmental regulatory regimes and the expected
timeframes for receipt of such approvals, permits, licenses and
treatments; possible impacts of regulatory actions; capital expenditures;
expansion plans; success of the Company's mining and/or milling operations;
availability of equipment and supplies; availability of alternate feed materials
for processing; the Companys processing technologies; future production costs,
including costs of labor, energy, materials and supplies; future effective tax
rates; future benefits costs; future royalties payable; the outcome and possible
impacts of disputes and legal proceedings in which the Company is involved; the
timing and amount of estimated future production, including Energy Fuels
expectations regarding expected price levels required to support production and
the Companys ability to increase production as market conditions warrant; sales
volumes and future uranium and vanadium prices and treatment charges; future
trends in the Companys industry; global economic growth and industrial demand;
global growth in and/or attitudes towards nuclear energy; changes in global
uranium and vanadium and concentrate inventories; expected market fundamentals,
including the supply and demand for uranium and vanadium; the Companys and
industrys expectations relating to future prices of uranium and vanadium;
currency exchange rates; environmental risks; reclamation costs, including
unanticipated reclamation expenses; collateral requirements for surety
bonds; title disputes or claims; the adequacy of insurance coverage; and legal
proceedings and the potential outcomes therefrom.

In certain cases, forward looking statements can be identified
by the use of words such as plans, expects or does not expect, is
expected, is likely, budget, scheduled, estimates, forecasts,
intends, anticipates or does not anticipate, continue, or believes, and similar
expressions, or variations of such words and phrases or statements that certain
actions, events or results may, could, would, might or will be taken,
occur or be achieved.

- 1 -

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|ENERGY FUELS INC.                                                     
|----------------------------------------------------------------------
|Managements Discussion and Analysis                                  
|15 Months Ended December 31, 2013                                     
|(Expressed in
      thousands of U.S. Dollars, Unless Otherwise Noted)

Forward-looking statements are based on the opinions and
estimates of management as of the date such statements are made. Energy Fuels
believes that the expectations reflected in this forward-looking information are
reasonable but no assurance can be given that these expectations will prove to
be correct, and such forward-looking information included in this MD&A
should not be unduly relied upon. This information speaks only as of the date of
this MD&A.

Readers are cautioned that it would be unreasonable to rely on
any such forward looking statements and information as creating any legal
rights, and that the statements and information are not guarantees and may
involve known and unknown risks and uncertainties, and that actual results are
likely to differ (and may differ materially) and objectives and strategies may
differ or change from those expressed or implied in the forward looking
statements or information as a result of various factors. Such risks and
uncertainties include risks generally encountered in the development and
operation of mineral properties and processing facilities such as: risks
associated with mineral and resource estimates, including the risk of errors in
assumptions or methodologies; risks associated with estimating production,
forecasting future price levels necessary to support production, and the
Companys ability to increase production in response to any increases in
commodity prices; uncertainties and liabilities inherent in mining
operations; geological, technical and processing problems, including
unanticipated metallurgical difficulties, ground control problems, process
upsets and equipment malfunctions; risks associated with labour disturbances and
unavailability of skilled labour; risks associated with the availability and/or
fluctuations in the costs of raw materials and consumables used in the Company's
production processes; risks associated with environmental compliance and
permitting, including those created by changes in environmental legislation and
regulation and delays in obtaining permits and licenses that could impact
expected production levels or increases in expected production levels; actions
taken by regulatory authorities with respect to mining and processing
activities; risks associated with the Companys dependence on third parties in
the provision of transportation and other critical services; title risks; the
adequacy of insurance coverage; uncertainty as to reclamation and
decommissioning liabilities; the ability of the Companys bonding companies to
require increases in the collateral required to secure reclamation
obligations; the potential for, and outcome of, litigation and other legal
proceedings, including potential injunctions pending the outcome of such
litigation and proceedings; the ability of Energy Fuels to meet its obligations
to its creditors; risks associated with the Companys relationships with its
business and joint venture partners; failure to obtain industry partner,
government and other third party consents and approvals, when
required; competition for, among other things, capital, acquisitions of mineral
reserves, undeveloped lands and skilled personnel; incorrect assessments of the
value of acquisitions; risks posed by fluctuations in exchange rates and
interest rates, as well as general economic conditions; risks inherent in the
Companys and industrys forecasts or predictions of future uranium and vanadium
price levels; fluctuations in the market prices of uranium and vanadium, which
are cyclical and subject to substantial price fluctuations; the risks associated
with asset impairment as a result of decreases in uranium prices; risks
associated with lack of access to markets and the ability to access capital; the
market price of Energy Fuels securities; public resistance to nuclear energy or
uranium mining; uranium industry competition and international trade
restrictions; and the other factors discussed under Risk Factors in this
MD&A and in the Companys Annual Information Form dated March 26, 2014
available at http://www.sedar.com, and in its Form 40-F available at
http://www.sec.gov/edgar.shtml.

Actual results and developments are likely to differ, and may
differ materially, from those expressed or implied by the forward looking
statements contained in this MD&A.

Such statements are based on a number of assumptions which may
prove to be incorrect, including, but not limited to, the following assumptions:
that there is no material deterioration in general business and economic
conditions; that there is no unanticipated fluctuation of interest rates and
foreign exchange rates; that the supply and demand for, deliveries of, and the
level and volatility of prices of uranium, vanadium and the Companys other
primary metals and minerals develop as expected; that uranium and vanadium
prices required to reach, sustain or increase expected or forecasted production
levels are realized as expected; that the Company receives regulatory and
governmental approvals for the Companys development projects and other
operations on a timely basis; that the Company is able to operate its mineral
properties and processing facilities as expected; that existing licenses and
permits are renewed as required; that the Company is able to obtain financing
for the Companys development projects on reasonable terms; that the Company is
able to procure mining equipment and operating supplies in sufficient quantities
and on a timely basis; that engineering and construction timetables and capital
costs for the Companys development and expansion projects and restarting
projects on standby, are not incorrectly estimated or affected by unforeseen
circumstances; that costs of closure of various operations are accurately
estimated; that there are no unanticipated changes in collateral requirements
for surety bonds; that there are no unanticipated changes to market competition;
that the Companys reserve and resource estimates are within reasonable bounds
of accuracy (including with respect to size, grade and recoverability) and that the geological,
operational and price assumptions on which these are based are reasonable; that
environmental and other administrative and legal proceedings or disputes are
satisfactorily resolved; and that the Company maintains ongoing relations with
its employees and with its business and joint venture partners.

- 2 -

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|ENERGY FUELS INC.                                                     
|----------------------------------------------------------------------
|Managements Discussion and Analysis                                  
|15 Months Ended December 31, 2013                                     
|(Expressed in
      thousands of U.S. Dollars, Unless Otherwise Noted)

All written and oral forward looking statements or information
attributable to the Company or persons acting on the Companys behalf are
expressly qualified in their entirety by the foregoing cautionary
statements.

Forward looking statements speak only as of the date the
statements are made. You should not put undue reliance on any forward looking
statements.

The Company cautions that the foregoing list of assumptions,
risks and uncertainties is not exhaustive. Additional information on these and
other factors which could affect operations or financial results are included
under the headingRisk Factorsin this MD&A and in the
Companys Annual Information Form dated March 26, 2014 available athttp://www.sedar.com,and in its Form 40-F available athttp://www.sec.gov/edgar.shtml.The forward-looking statements and
forward-looking information contained in this MD&A and the documents
incorporated by reference herein are expressly qualified by this cautionary
statement. The Company does not undertake any obligation to publicly update or
revise any forward looking statements to reflect actual results, changes in
assumptions or changes in other factors affecting any forward looking statements
or information except as expressly required by applicable securities laws. If
the Company does update one or more forward looking statements, no inference
should be drawn that the Company will make additional updates with respect to
those or other forward looking statements.

Statements relating to "mineral reserves" or "mineral
resources" are deemed to be forward-looking information, as they involve the
implied assessment, based on certain estimates and assumptions, that the mineral
reserves and mineral resources described can be profitably produced in the
future.

Cautionary Note to United States Investors Concerning
Estimates of Measured, Indicated and Inferred Resources:This MD&A has
been prepared in accordance with the requirements of Canadian securities laws,
which differ from the requirements of United States securities laws. Unless
otherwise indicated, all reserve and resource estimates included in this
MD&A have been prepared in accordance with Canadian National Instrument
43-101 - Standards of Disclosure for Mineral Projects(NI
43-101) and the Canadian Institute of Mining, Metallurgy and Petroleum
classification system. NI 43-101 is a rule developed by the Canadian Securities
Administrators (the CSA) which establishes standards for all public
disclosure an issuer makes of scientific and technical information concerning
mineral projects.

Canadian standards, including NI 43-101, differ significantly
from the requirements of the United States Securities and Exchange Commission
(the SEC), and reserve and resource information contained in this
MD&A, and in the documents incorporated by reference herein, may not be
comparable to similar information disclosed by companies reporting under United
States standards. In particular, and without limiting the generality of the
foregoing, the term resource does not equate to the term reserve. Under
United States standards, mineralization may not be classified as a reserve
unless the determination has been made that the mineralization could be
economically and legally produced or extracted at the time the reserve
determination is made.

The SECs disclosure standards normally do not permit the
inclusion of information concerning measured mineral resources, indicated
mineral resources or inferred mineral resources or other descriptions of the
amount of mineralization in mineral deposits that do not constitute reserves
by United States standards in documents filed with the SEC. United States
investors should also understand that inferred mineral resources have a great
amount of uncertainty as to their existence and as to their economic and legal
feasibility. It cannot be assumed that all or any part of an inferred mineral
resource will ever be upgraded to a higher category. Under Canadian rules,
estimated inferred mineral resources may not form the basis of feasibility or
prefeasibility studies. United States investors are cautioned not to assume
that all or any part of measured or indicated mineral resources will ever be
converted into mineral reserves. Investors are cautioned not to assume that all
or any part of an inferred mineral resource exists or is economically or
legally mineable.

Disclosure of contained pounds in a resource estimate is
permitted disclosure under Canadian regulations; however, the SEC normally only
permits issuers to report mineralization that does not constitute reserves by
SEC standards as in place tonnage and grade without reference to unit measures.
The requirements of NI 43-101 for identification of reserves are also not the same as
those of the SEC, and reserves reported by the Company in compliance with NI
43-101 may not qualify as reserves under SEC standards. Accordingly,
information concerning mineral deposits set forth herein may not be comparable
to information made public by companies that report in accordance with United
States standards.

- 3 -

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|ENERGY FUELS INC.                                                     
|----------------------------------------------------------------------
|Managements Discussion and Analysis                                  
|15 Months Ended December 31, 2013                                     
|(Expressed in
      thousands of U.S. Dollars, Unless Otherwise Noted)

2013 HIGHLIGHTS

Acquisitions and Investments

| | On August 30, 2013, Energy Fuels acquired, by way of a
      plan of arrangement (Arrangement), all of the issued and
      outstanding shares of Strathmore. The Arrangement was completed under the
      Business Corporations Act(British Columbia) and was
      previously approved by the Supreme Court of British Columbia. Under the
      Arrangement, Strathmore shareholders received 0.0294 common shares of
      Energy Fuels for each common share of Strathmore held. The acquisition of
      Strathmore by Energy Fuels added significant mineral resources to the
      Companys portfolio, including two large uranium projects, the Roca Honda
      and Gas Hills projects. The acquisition also strengthened the Companys
      relationship with Korea Electric Power Corporation (KEPCO), which
      was a significant shareholder of Strathmore and has the right to earn an
      interest in the Gas Hills project, and made the Company a joint venture
      partner on the Roca Honda Project with Sumitomo Corporation of Japan.                                                                                                                
|- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
| | On January 28, 2013, Energy Fuels acquired a 16.5%
      interest in Virginia Energy Resources Inc. (Virginia
      Energy) (TSX.V:VUI; OTCQX:VEGYF) as part of a non-brokered private
      placement financing. Energy Fuels acquired 9,439,857 common shares of
      Virginia Energy at a price of Cdn$0.42 per share, for an aggregate
      subscription price of $4.16 million. The subscription price was satisfied
      by a combination of $0.25 million of cash and the issuance of 437,028
      common shares of Energy Fuels.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
| | On October 1, 2012, the Company acquired the interests of
      Aldershot Resources Ltd. (Aldershot) in the Sage Plain Project
      for $0.75 million in cash, the cancellation of debt owed by Aldershot to
      Energy Fuels, and 70,551 shares of Common Stock. In the transaction,
      Energy Fuels acquired Aldershots membership interest in Colorado Plateau
      Partners LLC (CPP) and Arizona Strip Partners LLC (ASP),
      two 50/50 joint ventures between subsidiaries of Energy Fuels and
      Aldershot. CPP holds a majority of the properties in the Sage Plain
      Project area, including the Calliham lease, the Crain lease, four SITLA
      Leases and 94 unpatented mining claims on land managed by the U.S. Bureau
      of Land Management (BLM). As a result of the acquisition, Energy
      Fuels now owns 100% of the Sage Plain Project, which is located about
      15-miles northeast of Monticello, Utah and about 54 road miles from Energy
      Fuels White Mesa Mill. In addition, Energy Fuels acquired Aldershots
      interest in ASP which holds several prospective exploration properties in
      northern Arizona.

Operations

| | Energy Fuels fiscal year 2013 (FY-2013) uranium
      production totaled 1,235,000 pounds uranium oxide
      (U3O8) at the White Mesa
      Mill. Energy Fuels
      FY-2013 vanadium production totaled 1,537,000 pounds vanadium oxide
      (V2O5).                                                                                                                                                                                                                                                                                                                                
|- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| | Total revenue for FY-2013 was $73.25 million. Uranium
      sales during FY-2013 were 1,196,668 pounds U3O8 totaling $63.73 million,
      which included the sale of 956,668 pounds of U3O8 pursuant to term
      contracts at an average price of $56.47 per pound, the sale of 40,000
      pounds of U3O8 on the spot market at an average price of $41.50per pound
      and the sale of 200,000 pounds of U3O8 to an existing customer at an
      average price of $40.25 per pound. Vanadium sales during FY-2013 totaled
      $9.20 million and other revenue totaled $0.32 million.
|  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| | Energy Fuels has a working capital position of $33.48
      million, including $6.63 million of cash and $19.75 million in
      concentrates and work-in-process inventories. At the end of FY-2013, the
      Company had 452,000 pounds of U3O8 finished goods inventory and 96,000
      pounds of U3O8 in-process of completion.                                                                                                                                                                                                                                                          
|  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| | During FY-2013, the Company continued to produce uranium
      ore at its Arizona 1 mine in Arizona. In February 2014, the currently
      economic uranium resource was depleted at the Arizona 1 mine, which was
      then placed on standby.                                                                                                                                                                                                                                                                                                                                               

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|ENERGY FUELS INC.                                                     
|----------------------------------------------------------------------
|Managements Discussion and Analysis                                  
|15 Months Ended December 31, 2013                                     
|(Expressed in
      thousands of U.S. Dollars, Unless Otherwise Noted)

| | During FY-2013, the Company continued development of its
      Pinenut mine in Arizona, and production commenced in mid-2013. Production
      continued at the Pinenut mine through the end of FY-2013. In November 2013,
      the Company announced that the Pinenut mine was expected
      to be placed on standby in mid-2014.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
| | In the quarter ended December 31, 2012, the Company
      placed its Daneros, Beaver and Pandora mines on stand-by due to lower
      uranium spot market prices. These mines remain on stand-by as of the date
      of this MD&A.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
| | Shaft sinking operations at the Companys Canyon mine in
      Arizona commenced in early April 2013, and were placed on standby in
      November 2013, due to market conditions.  Up to that point, the shaft had been sunk to a
      depth of 300 feet, and all surface development on the project had been
      completed, including the head-frame, the hoist, the evaporation ponds,
      environmental monitoring facilities and all buildings. The Company agreed
      to maintain such activities on standby until the earlier of a decision by
      the Arizona District Court on the merits of the current litigation at the
      Canyon mine or December 31, 2014. See Contingencies Legal Matters. The
      Company does not expect to perform any development at the Canyon mine
      during FY-2014.

Capital Raising

| | On June 13, 2013, the Company announced the completion of
      a $6.52 million bought deal private placement of units of the Company
      (Units) pursuant to an underwriting agreement with Dundee
      Securities Ltd., Haywood Securities Inc. and Cantor Fitzgerald Canada
      Corporation. A total of 947,616 Units were issued at a price of Cdn$7.00
      per Unit for total gross proceeds of $6.52 million. Each Unit consists of
      one common share of the Company and one-half of one common share purchase
      warrant. Each whole warrant entitles the holder thereof to acquire one
      common share of the Company at a price of Cdn$9.50 at any time until June
      15, 2015.
|- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
| | On October 16, 2013, the Company completed a public
      offering (Offering) of 625,000 common shares at a price of
      Cdn$8.00 per share for aggregate gross proceeds of $4.83 million. The
      Offering was conducted by way of a short form prospectus dated October 9,
      2013 through a syndicate of underwriters led by Dundee Securities Ltd.,
      Cantor Fitzgerald Canada Corporation and Haywood Securities Inc. (the
      Underwriters). In addition, 30,963 compensation warrants were
      issued to the Underwriters.                                                                                                                                                           

Other

| | In order to facilitate a listing of the Companys common
      shares on a recognized US stock exchange, the Company completed a
      consolidation of its common shares on the basis of 50 pre-consolidation
      shares for each post-consolidation share. The shareholders of the Company
      approved the consolidation at a special meeting held on October 30, 2013.
      The common shares of Energy Fuels began trading on the Toronto Stock
      Exchange on a post-consolidated basis on November 5, 2013.                                                                                                                                                                                                                                                                                                                                                  
|- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
| | On December 2, 2013, the Company announced that its
      common stock was approved for listing on the NYSE MKT stock exchange.
      Trading on the NYSE MKT commenced on December 4, 2013, under the ticker
      symbol UUUU. As a leading conventional producer of uranium in the United
      States, the NYSE MKT listing is viewed by the Company as an important step
      toward increasing Energy Fuels visibility in the U.S., gaining access to a
      larger pool of institutional and retail investors, and improving the
      overall trading liquidity of the common shares.                                                                                                                                                                                                                                                                           
|  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
| | The Company changed its fiscal year end from September 30
      to December 31, to better align the Companys year-end with the year-ends
      of its major uranium customers, certain material subsidiaries and industry
      peers. As a result of this change of year-end, the Companys annual 2013
      results comprise the 15 month period beginning on October 1, 2012 and
      ending on December 31, 2013.                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
| | On December 17, 2013, the Company announced that it had
      entered into a Strategic Relationship Agreement (SRA) with KEPCO.
      KEPCO is the largest electric utility in South Korea, responsible for 93%
      of South Koreas electricity generation and the development of nuclear
      projects worldwide. The key objectives of the SRA are to establish a
      long-term and strategic collaborative relationship and to promote the
      development of each companys businesses. The SRA addresses a number of
      areas of interest for both Energy Fuels and KEPCO, including the
      development of Energy Fuels Wyoming projects, KEPCOs seat on the board of directors of Energy Fuels,
visitation and secondment rights, and future qualified bidding by Energy Fuels
on uranium concentrate supply contracts for KEPCO and its affiliates.

- 5 -

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|ENERGY FUELS INC.                                                     
|----------------------------------------------------------------------
|Managements Discussion and Analysis                                  
|15 Months Ended December 31, 2013                                     
|(Expressed in
      thousands of U.S. Dollars, Unless Otherwise Noted)

|  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | On March 3, 2014, the Company completed the replacement
      of its $28.17 million regulatory bonding portfolio, utilizing three
      different qualified sureties. As a result of replacing the bonds, the
      Company released $12.34 million of previously restricted cash. Prior
      bonding arrangements, covering all of the Companys mines and mills,
      required the Company to post 100% cash collateral to back the currently
      outstanding $26.78 million undiscounted decommissioning liability.
|  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           

ABOUT ENERGY FUELS

Energy Fuels was incorporated on June 24, 1987 in the province
of Alberta under the name Volcanic Metals Exploration Inc. On September 2, 2005,
the Company was continued under the Business Corporations Act(Ontario),
and on May 26, 2006, Volcanic Metals Exploration Inc. changed its name to Energy
Fuels Inc. Energy Fuels is a reporting issuer in all of the Canadian provinces.
Energy Fuels common shares are listed on the Toronto Stock Exchange (the
TSX) under the symbol EFR and on the NYSE MKT under the symbol
UUUU. In addition, Energy Fuels convertible debentures (the
Debentures) are listed on the TSX under the symbol EFR.DB. Options on
Energy Fuels common shares are traded on The Chicago Board Options Exchange.
The Designated Primary Market Maker for the options is Group One Trading,
LP.

Energy Fuels is a U.S.-based intermediate uranium mining and
production company with operations in Utah, Arizona, Colorado, New Mexico and
Wyoming. Energy Fuels wholly owns the White Mesa Mill in Utah (the White Mesa
Mill), the only operating conventional uranium processing facility in the
United States. At the White Mesa Mill, the Company produced both uranium (as U3O8
or yellowcake) and vanadium (as V2O5 or blackflake vanadium)
during FY-2013. Vanadium is a co-product from some of the Companys mines on the
Colorado Plateau, and the White Mesa Mill has a vanadium circuit to allow for
the recovery of this mineral. The U3O8 is sold to utility companies under
existing sales contracts for use in nuclear power generation as well as sold
into the spot market to a variety of buyers including utilities, commodities
traders and/or financial institutions. Additionally, the Company may purchase
U3O8 for resale to its customers. The V2O5 is primarily sold to steel and alloy
manufacturers. The White Mesa Mill produces additional U3O8 through the
processing of other uranium-bearing sources, referred to as alternate feed
materials.

Energy Fuels owns or controls a diverse portfolio of
uranium/vanadium properties in various stages of exploration, permitting,
development and production, in close proximity to the Companys White Mesa Mill,
including a producing mine on the Arizona Strip, mines on standby on the
Colorado Plateau, and additional permitting, development and exploration
properties in Utah, Arizona, New Mexico, and Colorado. Energy Fuels also owns
the Sheep Mountain Project in Wyoming, a project in the advanced-stage of
permitting with significant uranium resources, along with other projects in the
exploration and permitting stages in Wyoming.

Energy Fuels has a corporate office in Toronto, Ontario, and its
operations are managed from its office in Lakewood, Colorado.

- 6 -

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|ENERGY FUELS INC.                                                     
|----------------------------------------------------------------------
|Managements Discussion and Analysis                                  
|15 Months Ended December 31, 2013                                     
|(Expressed in
      thousands of U.S. Dollars, Unless Otherwise Noted)

MARKETING

The Uranium Industry

Over the medium- to long-term, nuclear power capacity and power
generation are growing, while uranium production will likely struggle to meet
this growing demand. As a result, it should be expected that prices will need to
rise to higher, sustained levels to support the new mines that will be required
to meet increasing demand. However, in the short-to medium term, there is
uncertainty about uranium prices as a result of ample worldwide uranium
inventories and the slower-than-expected restart of Japans nuclear reactors. As
a result of current market conditions, many producing uranium mines have been
placed on standby, and uranium development projects are being delayed around the
World.

Future Uranium Demand

World net electricity consumption is expected to increase by
69% by 2035, according to the World Energy Outlook 2013 (the "WEO 2013"),
a report issued by the International Energy Agency. Total demand for electricity
is projected to increase on average by 2.2% per year from 19,004 terawatt-hours
in 2010 to 32,150 terawatt-hours in 2035. This increased demand appears to be
driven by both economic and population growth. China and India account for over
49%, and OECD countries make up less than 17% of the new demand. As a result of
high fossil fuel prices, energy security concerns, improved reactor designs and
climate change concerns, new nuclear capacity is expected to be a significant
part of meeting this growth in electricity demand.

According to the World Nuclear Association (WNA), as
of February, 2014, there are 434 nuclear reactors operable worldwide in 30
countries, generating 374.3 gigawatts of electricity. Of perhaps greater
significance, 70 nuclear reactors are under construction in 14 countries
including 49 under construction in China, India, South Korea and Russia. The 70
reactors under construction are expected to require over 100 million pounds of
U3O8 for initial cores and an additional 38 million pounds of U3O8 annually once
they are in operation. China, in particular, has a very aggressive new build
program underway, including 28 reactors under construction and 176 on order,
planned or proposed. Overall, there are 483 new reactors on order, planned or
proposed around the World.

Nevertheless, the industry continues to feel the after-effects
of the March 2011 Japanese earthquake and tsunami, and resulting nuclear
incident. However, while some countries, such as Germany, have announced
intentions to reduce their reliance on nuclear power, most countries have
reaffirmed their support for nuclear power. Japan is expected to begin to
restart some of its existing reactors during 2014, and political support for
nuclear power in Japan continues to increase. Seventeen reactors in Japan have
applied for restarts. However, the process has been slower than expected. Due to
the slow restart of Japans nuclear fleet, stockpiles of uranium in that country
have built to significant levels. The loss of ongoing demand in Japan along with
the inevitable build-up of inventory resulting from Japanese delivery
commitments under long term contracts have imposed both a real and a
psychological overhang on the uranium market. Many estimates for Japanese
reactor restarts during 2014 can be found in the financial press. Most expect at
least some restarts during the year, but Energy Fuels estimates the actual
number is probably somewhere between two units and six units. Any restarts at
all should bolster the uranium market, and this effect is believed by the
Company to have been seen in late February 2014 with a resurgence in uranium
equity values.

Significantly, the governments of China, India, South Korea and
Russia have all announced their intention to move ahead with their nuclear
plans. In addition, several non-nuclear countries are moving ahead with their
plans, such as Saudi Arabia which plans to build up to 16 reactors, Poland with
plans to build 6, and the United Arab Emirates which has two under construction
and contracts for two more. The 70 new reactors now under construction worldwide
are expected to require approximately 38 million pounds of uranium per year, and
those that are on order, planned or proposed are expected to require
approximately 268 million pounds of uranium per year. Contrasting this with
expected 2014 global reactor demand of just over 171 million pounds clearly
illustrates the growth anticipated in the uranium business.

Primary Uranium Supply

Uranium supply is the biggest variable in the supply-demand
equation. During the time that the accumulated inventories from over production
in the 1970s were being drawn down, primary mine production accounted for only
approximately 50% of demand. A number of new mines have been brought into
production over the last few years while others are in various stages of
development. However, production now accounts for approximately 90% of demand,
and more mines will be required to meet the increasing future demand and to
replace mines that are being depleted.

- 7 -

---

|ENERGY FUELS INC.                                                     
|----------------------------------------------------------------------
|Managements Discussion and Analysis                                  
|15 Months Ended December 31, 2013                                     
|(Expressed in
      thousands of U.S. Dollars, Unless Otherwise Noted)

Ux Consulting Company, LLC (UxC) has estimated in its Uranium Market Outlook  Q1 2014
that existing mine production plus new planned and potential mine production
will increase primary uranium supply from 154 million pounds in 2013 to 200
million pounds in 2020. Kazakhstan was earlier perceived to be increasing
production by as much as 21% between 2012 and 2020. However current estimates by
UxC place that Kazakh production growth at only about 10%.In order to reach
these estimated primary uranium supply levels, to the extent not filled by
current production and secondary sources, it is anticipated that a number of
large new mines, around the world, will also need to be developed and brought
into production. It is reasonable to expect that prices will need to increase
appreciably to support the additional production and significant capital
expenditures required to develop and build the mines to meet these production
forecasts.

Secondary Uranium Supply

Primary mine production currently supplies approximately 90% of
demand. The balance of demand is supplied from secondary sources such as
remaining excess commercial inventories, reprocessing of spent fuel, and
inventories held by governments. The down-blending of highly-enriched uranium
(HEU) from nuclear weapons programs was by far, the most significant of
the secondary supplies, providing 18 to 24 million pounds per year. The HEU
program was officially terminated at the end of 2013. As excess inventories due
to the Japanese reactor shutdown are brought into balance, it is expected that
the supply gap created by the HEU termination will have to be made up from new
primary mine production or other secondary sources.

Excess commercial inventories, which were once one of the major
sources of secondary supplies during the period from the early 1970s to the
early 2000s, are believed to have largely been consumed (other than the
stockpiles of uranium in Japan that have accrued as a result of the Fukushima
incident). However, some government inventories, particularly in the U.S. and
Russia, remain. The disposition of these inventories may have a market impact
over the next 10 to 20 years, although the rate and timing of this material
entering the market is uncertain. The market is however currently being affected
by the release of DOE material related to continued cleanup operations at USEC
Inc.

Reprocessing of spent fuel is another source of secondary
supply, but is expected to satisfy only 3% to 4% of demand. Expansion of this
secondary source would require major investments in facilities, which the
Company believes could only be supported by a significant increase in long-term
uranium prices.

The shutdown of nuclear reactors in Japan as a result of the
Fukushima incident has also resulted in a reduction in enrichment demand, which
has allowed enrichment facilities to use their excess capacity to produce more
fuel from the same amount of uranium feed, at little or no additional cost. UxC
estimates that this will effectively place 12  18 million pounds per year of
additional U3O8 into the market for as long as excess capacity remains in the
enrichment business.

However, in the longer term, UxC expects that secondary sources
of supply will fall from 52 million pounds to 29 million pounds per year from
now to 2020.

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. Their electric utilities must secure their required uranium supply by
entering into medium- and long-term contracts with foreign uranium producers and
other suppliers. These contracts usually provide for deliveries to begin two to
four years after they are signed and provide for delivery from four to ten years
thereafter. In awarding medium- and long-term contracts, electric utilities
consider, in addition to the commercial terms offered, the producers uranium
reserves, record of performance and costs, which are important to the producer's
or suppliers ability to fulfill long-term supply commitments. Electric
utilities procure their remaining requirements through spot and near-term
purchases from uranium producers and other suppliers, including other utilities
holding excess inventory and governments.

While long-term demand is steadily growing, short-term demand
is affected in large part by utilities uncovered requirements. To the extent
that they have uncovered demand in the near term, they generally will purchase
on the spot market, which in turn affects the spot price. Currently, there is
relatively little uncovered demand, so utility buying is primarily discretionary
and price driven.

- 8 -

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|ENERGY FUELS INC.                                                     
|----------------------------------------------------------------------
|Managements Discussion and Analysis                                  
|15 Months Ended December 31, 2013                                     
|(Expressed in
      thousands of U.S. Dollars, Unless Otherwise Noted)

Historically, spot prices are more volatile than long-term
prices. The spot price began 2013 at $43.50 per lb. and fell steadily throughout
the first half of the year reaching the $35.00 per lb. level in late July where
they have generally remained.

The long-term price ranged from $56.00 per pound U3O8 at the
beginning of 2013, and cycled between $55.00 and $57.00 until September. At the
end of September 2013, long-term prices fell to $50.00 per pound where they are
currently. Long-term prices are driven more by production costs and future
supply-demand forecasts than by customer inventories, but even long-term prices
have fallen due to the lack of long term contracting activity by the utilities.

Competition

Uranium production and marketing are international in scope and
characterized by a relatively small number of companies operating in only a few
countries. The top eight producers accounted for about 82% of the worlds
primary mine supply in 2012.

About 80% of the worlds production came from five countries,
namely Kazakhstan, Canada, Australia, Niger, and Namibia. Kazakhstan passed
Canada in 2009 as the largest producer, a role Canada had held for 17 years.

Marketing Uranium

The uranium market is truly global in scope. The value of the
commodity is so high per unit weight that it can literally be shipped anywhere.
A shipping drum of U3O8 will have a typical gross weight of about 920 pounds, of
which about 850 pounds will be U3O8. At a price of $35.00 per pound, a short ton
of U3O8 would have a market value of $70,000. Typical freight costs for an
overseas uranium shipment would represent only 1 - 2% of the current spot market
value of the product delivered.

Energy Fuels has sold its uranium under a combination of
long-term and spot contracts. The long-term contracts have a variety of pricing
mechanisms, including fixed prices, base prices adjusted by inflation indices
and/or spot price or long-term contract reference prices. Time of delivery
during a year under long-term contracts is at the discretion of the customer, so
the Companys delivery obligations may vary markedly from quarter to quarter.
Spot sales were priced at or near published industry spot prices.

During the 15 months ended December 31, 2013, approximately 80%
of Energy Fuels total sales volume was sold under long-term contracts, with the
remainder sold in the spot market. The Company currently has three long-term
contracts in place. One contract is for 350,000 pounds (±10%) per year from 2010
to 2015 inclusive. This agreement also provides for the purchase of 350,000 lbs.
per year after 2015 subject to certain conditions. The second contract is for
delivery of 1,100,000 pounds of U3O8 over a period of six years beginning in
2011. The third contract was renegotiated in 2013 and now provides for the
delivery of 300,000 pounds of U3O8 per year for 2014 through 2017 inclusive.

Energy Fuels will continue to seek long-term contracts at
prices sufficient to support the development of its mineral assets as well as to
seek out spot sales opportunities that make financial sense for the Company.

Sales of U3O8 for 2014 are expected to be 800,000 pounds in FY
2014, all pursuant to existing long-term contracts at an average realized price
of $58.42 per pound. The Company may consider additional U3O8 sales as market
conditions and concentrate supplies warrant.

Vanadium

In the past, Energy Fuels has sold its vanadium both as both
V2O5 and as ferrovanadium (FeV) through spot sales to industry
end-users and trading companies. Vanadium sales by Energy Fuels during FY-2013
were 1.5 million pounds. However, because all of Energy Fuels vanadium
producing uranium mines are currently on standby due to low uranium prices,
there will be no vanadium sales in 2014.

Strategy

For the short-term, given the stagnant low spot price of
uranium discussed above, Energy Fuels intends to cut back production quantities
to approximately 500,000 pounds of U3O8 for FY-2014 and has secured purchases of
uranium.

- 9 -

---

|ENERGY FUELS INC.                                                     
|----------------------------------------------------------------------
|Managements Discussion and Analysis                                  
|15 Months Ended December 31, 2013                                     
|(Expressed in
      thousands of U.S. Dollars, Unless Otherwise Noted)

These sources of uranium along with present finished goods on
hand will allow the Company to meet all of its contractual commitments through
at least December 31, 2015. During the first half of FY-2014 Energy Fuels will
continue to mine at the Pinenut mine. Mining at the Companys Arizona 1 mine was
placed on standby in February 2014, upon depletion of the currently economic
uranium resource at that time. During the first half of FY-2014 the Company
intends to continue processing alternate feed materials as well as mill and
process stockpiled ore from the Pinenut and Arizona 1mines at the White Mesa
Mill. The Company then expects to place all mine production and mineral
processing at the White Mesa Mill on standby during the second half of FY-2014.
The Company will continue to receive alternate feed materials at the White Mesa
Mill for future processing.

With respect to its sales strategy in the short-term, as a
result of the relatively weak uranium spot price, Energy Fuels will primarily
focus on sales pursuant to its term contracts, which require deliveries of
800,000 lbs. during FY-2014, of which 300,000 pounds will be from purchased
material. The Company expects its sales to result in average realized prices of
$58.42/lb. , which would be well-above the expected spot market price. At
current prices, the Company does not expect to produce any product for sale at
spot prices, nor does the Company expect to sell any existing product at spot
prices. Also, if low prices continue, the Company may not restart mineral
processing activities at the White Mesa Mill during 2015. The Company intends to
closely monitor U3O8 prices, and may change operating plans under actual or
expected market conditions as necessary.

Though prices in the short and medium term are under intense
pressure from excess supplies, as reported in the above referenced UxC Uranium
Market Outlook for Q1 2014, in the longer term, Energy Fuels believes prices
will improve and intends to continue to strengthen its position as a leading
uranium company in the United States, through business development activities,
including development of existing projects, as market conditions warrant. Energy
Fuels will also look to further acquire uranium properties in the United States,
if favorable opportunities arise. Environmental and permit compliance and
maintenance activities will continue at the White Mesa Mill in order to maintain
the facility to be able to restart mineral processing operations as required.
Energy Fuels currently intends to maintain several mines on standby and continue
to permit other new projects, thereby positioning the Company to increase
production as market conditions warrant.

The Company utilizes various industry forecasts to assist in
its business planning, evaluation of existing and future mining projects, and
assessment of its valuation of long-lived assets. In March 2014 UxC published
its Uranium Market Outlook  Q1 2014. In this report UxC reduced its annual
price projections for the period from 2014 to 2025 compared with their Q4 2013
report (published in December 2013). The Company is currently evaluating the
revised forecast, along with other industry forecasts, to determine the
Companys expectation of future uranium prices. In the event the Company
concludes that a significant deterioration in expected future uranium prices has
occurred, the Company will assess whether an impairment allowance is necessary
which, if required, could be material, and may adjust its operations.

ACQUISITION OF STRATHMORE MINERALS CORP.

On August 30, 2013, Energy Fuels completed the acquisition of
Strathmore Minerals Corp. (Strathmore). Energy Fuels acquired, all of
the outstanding common shares of Strathmore in exchange for 0.0294 common shares
of Energy Fuels for each whole common share of Strathmore. A total of 3,728,419
Energy Fuels common shares were issued in the exchange for all the common shares
of Strathmore.

The projects acquired by Energy Fuels in its acquisition of
Strathmore, include uranium projects located primarily in Wyoming and New
Mexico. The Company believes that significant synergies could be achieved by
combining Strathmores projects with Energy Fuels projects. In Wyoming,
Strathmore holds the Gas Hills and Juniper Ridge uranium projects. Energy Fuels
is evaluating the co-development of those projects with the Companys nearby
Sheep Mountain Project, including the potential to utilize common infrastructure
and processing facilities. Combined, these three projects have 19.3 million tons
of Measured and Indicated Mineral Resources with an average grade of 0.11%,
containing 40.9 million lbs. of U3O8. The three projects contain a significant
amount of additional Inferred Mineral Resources.

In New Mexico, Energy Fuels acquired a 60% interest in the Roca
Honda Project. In total, according to a Technical Report (including a
Preliminary Economic Analysis) prepared in accordance with NI 43-101, the Roca
Honda Project contains 2.08 million tons of Measured & Indicated Mineral
Resources with an average grade of 0.40%, containing 16.8 million lbs. of U3O8.
In addition, the project contains an additional 1.4 million tons of Inferred
Mineral Resources with an average grade of 0.41% containing 11.9 million lbs. of
U3O8. The technical report for Roca Honda can be found in Canada at
www.sedar.com and in the United States at www.sec.gov/edgar.shtml,and on
Energy Fuels website at www.energyfuels.com. Energy Fuels believes significant
synergies exist in acquiring the Roca Honda Project, including the potential to truck some or all of the
projects mineral resources to the Companys White Mesa Mill for processing.
This would avoid the need to permit and build a new mill in New Mexico.

- 10 -

---

|ENERGY FUELS INC.                                                     
|----------------------------------------------------------------------
|Managements Discussion and Analysis                                  
|15 Months Ended December 31, 2013                                     
|(Expressed in
      thousands of U.S. Dollars, Unless Otherwise Noted)

SELECTED ANNUAL FINANCIAL INFORMATION

The following selected financial information was obtained
directly from or calculated using the Companys consolidated financial
statements for the following fiscal years. Note, due to the change in year end
for the Company, the following information includes the 12 month period for the
years ended September 30, 2012 and 2011 and the 15-month period ended December
31, 2013.

15 months ended
    
    
    12 months ended
    
    
    12 months ended$000, except per share data
    
    December 31, 2013
    
    
    September 30, 2012
    
    
    September 30, 2011Results of Operations:Total revenues
    $
    73,248
    
    $
    25,028
    
    $
    -Net income (loss)
    
    (87,325
    )
    
    1,534
    
    
    (3,567
    )Basic and diluted earnings (loss) per share
    
    (5.61
    )
    
    0.26
    
    
    (2.00
    )


|                                    |   | As at December 31, |  |   | As at September 30, |  |   | As at September 30, | 
|----------------------------------- | - | ------------------ |  | - | ------------------- |  | - | ------------------- | 
|$000's                              |   | 2013               |  |   | 2012                |  |   | 2011                | 
|Financial Position:                 |   |                    |  |   |                     |  |   |                     | 
|Working capital                     | $ | 33,480             |  | $ | 41,934              |  | $ | 6,788               | 
|Property, plant and
      equipment |   | 100,969            |  |   | 119,524             |  |   | 33,292              | 
|Total assets                        |   | 176,133            |  |   | 223,844             |  |   | 43,493              | 
|Total long-term liabilities         |   | 31,579             |  |   | 37,921              |  |   | 452                 | 

OVERVIEW

Prior to June 2012, Energy Fuels was primarily a uranium and
vanadium exploration and mine development company with no revenue or operating
mines. In June 2012 Energy Fuels acquired the US-based uranium and vanadium
operating mines, an operating mill and various non-operating mines and
development prospects of Denison Mines Corp. and became a production company.
The operations of Energy Fuels including support staff and expenditures
increased dramatically upon completion of the acquisition. Accordingly, the year
ended September 30, 2012 has three months of producing operations and the
financial period ended December 31, 2013, due to the change in year-end, has 15
months of producing operations.

As further discussed above, beginning in July 2012 market
prices for uranium began a gradual but steady decline from a spot price of
$50.75 at June 30, 2012 to a current spot price of approximately $35.00. In
response to the decline in market prices, Energy Fuels has cut back its
operations by placing various mines on stand-by, reducing the throughput in the
White Mesa Mill and curtailing or reducing certain development activities. The
substantially reduced and variable levels of production make period-to-period
changes not comparable. Also, these actual results cannot be projected into the
future with any degree of accuracy. Additionally, the Company entered into
contracts to purchase 300,000 pounds of uranium to deliver product required by
one of its contracts in FY-2014.

RESULTS OF OPERATIONS  FY-2013 compared with
FY-2012

General

For the 15 months ended December 31, 2013, the Company recorded
a net loss of $87.33 million or $5.61 per share, which included an impairment
loss of $62.20 million compared to net income of $1.53 million or $0.26 per share
for the twelve months ended2012, which included a $40.63 million gain on the
bargain purchase associated with the June 2012 acquisition of Denison Mines
Corp.s (Denisons) mining assets and operations located in the United
States (the Denison US Mining Division), partially offset by a $24.02
million impairment related to property, plant and equipment.

- 11 -

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|ENERGY FUELS INC.                                                     
|----------------------------------------------------------------------
|Managements Discussion and Analysis                                  
|15 Months Ended December 31, 2013                                     
|(Expressed in
      thousands of U.S. Dollars, Unless Otherwise Noted)

Revenues

Revenues for the 15 months ended December 31, 2013 totaled
$73.25 million (September 30, 2012  $25.03 million), of which $63.73 were sales
of uranium concentrates which included the sale of 956,668 pounds of U3O8
pursuant to term contracts at an average price of $56.47 per pound, the sale of
40,000 pounds of U3O8 on the spot market at an average price of $41.50, and the
sale of 200,000 pounds of U3O8 to an existing term contract customer at an
average price of $40.25 per pound. The Companys revenues for uranium are
largely based on delivery schedules for long-term contracts which can vary from
quarter to quarter. The 200,000 pound sale of U3O8 to an existing term contract
customer was completed at a premium to the spot market price at the time, in
consideration of the Company providing a discount to the customer on portions of
its long-term contract deliveries in the years 2015 through 2017.

Revenues for the 15 months ended December 31, 2013 also
included the sale of $9.20 million of vanadium in the form of V2O5 and ferro
vanadium and $0.32 million from other services.

Operating Expenses

Milling and Mining Expenses

For the 15 months ended December 31, 2013, uranium production
totaled 1,235,000 pounds of U3O8, including 370,000 pounds from alternate feed
materials, and vanadium production totaled 1,537,000 pounds of V2O5 of which
some of the production was converted to ferro vanadium by third party
convertors.

Cost of goods sold for the 15 months ended December 31, 2013
totaled $67.78 million, which consisted of $56.80 million of mining and milling
production costs, $7.71 million of depreciation and amortization and impairment
of inventories of $3.27 million.

Mineral Property Exploration, Evaluation and
Development

Energy Fuels is also engaged in uranium exploration and
development on its properties in the U.S. Exploration, evaluation, permitting
and development expenditures totaled $21.39 million for the 15 months ended
December 31, 2013, compared with $7.08 million for the twelve months ended
September 30, 2012. The majority of the development expenditures for the 15
months ended December 31, 2013 were for development activities at the Canyon and
Pinenut mines in Arizona, and the evaluation and permitting expenditures were
primarily for the Sheep Mountain project in Wyoming.

Selling, General and Administrative

Selling, general and administrative expenses totaled $24.90
million for the 15 months ended December 31, 2013, compared to $11.44 million
for the 12 months ended September 30, 2012. The increases in selling, general
and administrative expenses were primarily due to the June 29, 2012 acquisition
of the Denison US Mining Division, recognition of termination costs of certain
Strathmore employees, and the additional costs related to the uranium sales
contract amortization expense. General and administrative expenses consist
primarily of payroll and related expenses for personnel, contract and
professional services, stock option expense and other overhead expenditures.
Selling expenses for the 15 months ended December 31, 2013 totaled $1.25
million. Amortization of the intangible asset recorded for the U3O8 sales
contract values in excess of spot price at the June 29, 2012 acquisition date of
the Denison US Mining Division totaled $6.14 million of which $0.82 million
related to the 200,000 pound sale of U3O8 to an existing term contract customer.
This sale was completed at a premium to the spot market price at the time, in
consideration of the Company providing a discount on portions of its future
long-term contract deliveries to the customer in the years 2015 through 2017.

Care and Maintenance Expenses

The Companys Beaver, Pandora and Daneros mines were placed on
care and maintenance in the first quarter of FY-2013 as a result of current
market conditions and because the Company is able to fulfill its short-term
contractual uranium delivery requirements utilizing its existing uranium
concentrate inventories, and production from its existing stockpiles of ore,
producing mines in Arizona and alternate feed materials. Also, in November 2013
the Company placed shaft sinking operations on its Canyon mine on standby. Costs
related to the care and maintenance of these and other standby mines, totaled
$5.40 million for the 15 months ended December 31, 2013.

- 12 -

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|ENERGY FUELS INC.                                                     
|----------------------------------------------------------------------
|Managements Discussion and Analysis                                  
|15 Months Ended December 31, 2013                                     
|(Expressed in
      thousands of U.S. Dollars, Unless Otherwise Noted)

Other Income and Expenses

Net finance income totaled $0.96 million for the 15 months
ended December 31 and consists of a change in the mark-to-market values of
the Debentures totaling $2.74 million, interest income of $0.65 million and a
gain on foreign exchange of $0.50 million, partially offset by interest expense
incurred on the Debentures of $1.97 million, accretion expense related to the
decommissioning liability of $0.42 million, and change in value of marketable
securities of $0.54 million.

Net finance expense totaled $1.87 million for the twelve months
ended September 30, 2012 and consists of interest expense incurred on the
Debentures of $0.46 million, accretion expense related to the decommissioning
liability of $0.11 million, a change in the mark-to-market values of marketable
securities of $1.79 million and a loss on foreign exchange of $0.29 million,
partially offset by interest income of $0.18 million, and a change in value of
the Debentures of $0.60 million, respectively.

Impairment of property, plant and equipment

During the 15 months ended December 31, 2013, as a result of
the drop in the U3O8 spot price from July 1, 2013 through September 30, 2013 and
a 10% drop in the long-term price in September 2013, as well as the Companys
expectation to place the Pinenut mine on stand-by in July 2014, the Company
tested its plant, property and equipment for impairment. The Company estimated
the fair value of its mill and mines using discounted cash-flow analysis that
utilized forecasts of estimated U3O8 prices and determined that the Fair Value
Less Costs of Disposal to sell the mill, mineral properties and other property,
plant and equipment, except those acquired from Strathmore and the Companys
Sheep Mountain project in Wyoming, were in-excess of their aggregate carrying
values. Accordingly, the Company recognized an impairment loss of $60.26 million
in the period ended September 30, 2013.

The recoverable amount in the impairment analysis was based on
the Fair Value Less Cost of Disposal using discounted cash flow projections. Key
assumptions used in the calculation of recoverable amounts include discount
rates, uranium prices, future timing of production volume including the date
when a mineral property can be brought into production and the expected cost to
produce uranium and future operating costs.

The Companys estimate of future uranium sales prices were
based on the uranium prices prepared by industry analysts. For the purpose of
the impairment analysis, management estimated a uranium price of $ 38.00/lb. for
the period up to December 31, 2014; a price range of $42.00/lb. to $55.00/lb.
for the period 2015 to 2018 and $62.00/lb. to $75.00/lb. for the period 2019 to
2024. The Company used a pre-tax discount rate of 12.5% based on the Companys
estimated weighted-average cost of capital for discounting the cash flow
projections.

Impairment charges recognized against property, plant and
equipment may be reversed if there are changes in the assumptions or estimates
used in determining the recoverable amounts at the White Mesa Mill which indicate
that a previously recognized impairment loss may no longer exist or may have
decreased.

- 13 -

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|ENERGY FUELS INC.                                                     
|----------------------------------------------------------------------
|Managements Discussion and Analysis                                  
|15 Months Ended December 31, 2013                                     
|(Expressed in
      thousands of U.S. Dollars, Unless Otherwise Noted)

SUMMARY OF QUARTERLY RESULTS

Results for the nine most recent quarters ending with the
quarter ended December 31, 2013 are:

Dec 30
    
    
    Sept 30
    
    
    June 30
    
    
    Mar 31 *
    
    
    Dec 31 *2013
    
    
    2013
    
    
    2013
    
    
    2013
    
    
    2012$000, except per share data
    
    $
    
    
    $
    
    
    $
    
    
    $
    
    
    $Total revenues
    
    776
    
    
    24,504
    
    
    4,954
    
    
    34,087
    
    
    8,927Net Income (loss)
    
    (3,375
    )
    
    (70,472
    )
    
    (5,532
    )
    
    (5,903
    )
    
    (2,043
    )Basic & diluted net income (loss) per share
    
    (0.18
    )
    
    (4.30
    )
    
    (1.27
    )
    
    (0.42
    )
    
    (0.15
    )


Sept 30 *
    
    
    June 30 *
    
    
    Mar 31
    
    
    Dec 312012
    
    
    2012
    
    
    2012
    
    
    2011$000, except per share data
    
    $
    
    
    $
    
    
    $
    
    
    $Total revenues
    
    25,028
    
    
    -
    
    
    -
    
    
    -Net Income (loss)
    
    (19,160
    )
    
    23,697
    
    
    (2,414
    )
    
    (589
    )Basic & diluted net income (loss) per share
    
    (1.41
    )
    
    5.42
    
    
    (0.87
    )
    
    (0.24
    )


|* | Adjusted as a result of the finalization of the purchase
      allocation of Denison Mines Holdings Corp. (DMHC) in June
  2013.
|- | ----------------------------------------------------------------------------------------------------------------------------------

USE OF PROCEEDS FROM PUBLIC OFFERING

The following table outlines the proposed use of funds for
direct project categories (excluding general working capital) from the net
proceeds received from the October 15, 2013 public offering as compared to the
actual expenses incurred to December 31, 2013.

Estimated
    
    
    Actual Costs IncurredUse of Financing Net Proceeds
      (000's)
    
    Allocation of Net
    
    
    to December 31,(excluding General Working Capital)
    
    Proceeds
    
    
    2013Continued exploration and
      development of the Company's Roca Honda, Sheep Mountain, Gas Hills,
      Juniper Ridge and Canyon Mine mineral properties
    $
    2,500
    
    $
    1,254Identification and evaluation of future potential
      mineral property acquisitions
    
    750
    
    
    -$
    3,250
    
    $
    1,254


LIQUIDITY AND CAPITAL RESOURCES

The Company has historically financed its operations from
inception primarily through the issuance of equity securities as it had no
sources of cash flow from operations prior to the acquisition of Denison. As
discussed in Note 5 to the financial statements, the Company acquired mineral
properties and the mining and milling operating assets and liabilities of the US
Mining Division of Denison Mines Corp. on June 29, 2012. For purposes of
financing immediate working capital requirements, sustaining capital
expenditures for current mine and mill operations and longer term capital
development projects, the Company completed the following two financings during
FY-2013.

On June 13, 2013, Energy Fuels completed a Cdn$6.6 million
bought deal private placement of units of the Company Units) pursuant
to an underwriting agreement with Dundee Securities Ltd., Haywood Securities
Inc., and Cantor Fitzgerald Canada Corporation. The Company issued a total of
947,616 Units at a price of Cdn$7.00 per Unit for aggregate gross proceeds of
$6.52 million. Each Unit consists of one common share of the Company and
one-half of one common share purchase warrant entitling the holder thereof to
acquire one common share of the Company at a price of Cdn$9.50 at any time until
June 15, 2015.

On October 16, 2013, Energy Fuels completed a bought deal
offering of 625,000 common shares of the Company at a price of Cdn$8.00 per
common share for aggregate gross proceeds of $4.83 million. The transaction was conducted by way of a short form prospectus dated October 9,
2013 through a syndicate of underwriters led by Dundee Securities Ltd., Cantor
Fitzgerald Canada Corporation and Haywood Securities Ltd.

- 14 -

---

|ENERGY FUELS INC.                                                     
|----------------------------------------------------------------------
|Managements Discussion and Analysis                                  
|15 Months Ended December 31, 2013                                     
|(Expressed in
      thousands of U.S. Dollars, Unless Otherwise Noted)

With the net proceeds of these equity financings and with the
ongoing focus on cost management, the Company believes it has sufficient cash
resources to carry out its business plan beyond fiscal year 2014 and therefore
the company believes that it will continue as a going concern for the
foreseeable future.

Cash and Financial Condition

Cash and cash equivalents were $6.63 million at December 31,
2013 compared to $13.66 million at September 30, 2012.The decrease of $7.03
million was due primarily to cash used in investing activities of $15.20 million
partially offset by cash provided by financing activities of $7.86 million, plus
cash provided in operations of $0.45 million and loss on foreign exchange on
cash held of $0.46 million.

Net cash used in investing activities was $14.88 million, which
consisted of expenditures for property, plant and equipment of $6.50 million and
exploration, evaluation, permitting and development activities of $14.62 million,
partially offset by a decrease in restricted cash of $4.00 million related to
refunds and returns of restricted cash related to certain bonds posted by the
Company for mine reclamation obligations.

Net cash from financing activities totaled $7.86 million
consisting primarily of $10.24 million from the issue of common shares, less
$0.61 million repayment of borrowings and $1.79 million related to payments of
interest on the Debentures.

Net cash provided by operating activities of $0.45 million is
comprised of the net loss of $87.33 million for the period adjusted for non-cash
items and for changes in working capital items. Significant items not involving
cash were a $60.26 million impairment of property, plant and equipment, a $1.94
million impairment of Virginia Energy, a $3.27 million impairment of inventories
and a $16.39 million in depreciation, depletion and amortization.

Net cash used in operating activities of $14.25 million during
the year ended September 30, 2012 is comprised of the net income for the year
adjusted for non-cash items and for changes in working capital items.
Significant changes in working capital items during the year include an increase
of $5.99 million in trade and other receivables, an increase of $0.74 million prepaid expenses and other
assets and a decrease of $15.2 million in inventories.

Net cash used in investing activities was $5.68 million, which
consisted of expenditures for property, plant and equipment of $3.53 million and
exploration and evaluation activities of $3.55 million, offset by a decrease in
restricted cash of $1.01 million.

Net cash from financing activities totaled $26.44 million
consisting primarily of $7.14 million from the issue of common shares, $21.55
million from the issue of convertible notes, less $2.25 million net repayment of
debt obligations.

In total, these sources and uses of cash resulted in a net cash
inflow after the effect of foreign exchange of $6.70 million during the
year.

Contractual Obligations

The Company enters into commitments with federal and state
agencies and private individuals to lease mineral rights. These leases are
renewable annually and are expected to total $1.3 million for the year ended
December 31, 2014.

- 15 -

---

|ENERGY FUELS INC.                                                     
|----------------------------------------------------------------------
|Managements Discussion and Analysis                                  
|15 Months Ended December 31, 2013                                     
|(Expressed in
      thousands of U.S. Dollars, Unless Otherwise Noted)

The Company is committed to payments under various operating
leases and purchase agreements. Additionally, the Company is obligated to
complete certain mill and mine reclamation during operations and upon completion
of mining or milling operations at each site. The future minimum payments are as
follows:

2014
    
    
    2015
    
    
    2016
    
    
    2017
    
    
    2018
    
    
    Thereafter
    
    
    TotalAs at December
      31,
    
    $
    
    
    $
    
    
    $
    
    
    $
    
    
    $
    
    
    $
    
    
    $Rent
    
    297
    
    
    304
    
    
    311
    
    
    291
    
    
    -
    
    
    -
    
    
    1,203Office expenses
    
    40
    
    
    31
    
    
    15
    
    
    -
    
    
    -
    
    
    -
    
    
    86Consumable materials contracts
    
    4,125
    
    
    -
    
    
    -
    
    
    -
    
    
    -
    
    
    -
    
    
    4,125Reclamation
      expenditures
    
    1,876
    
    
    761
    
    
    -
    
    
    -
    
    
    -
    
    
    25,326
    
    
    27,9636,338
    
    
    1,096
    
    
    326
    
    
    291
    
    
    -
    
    
    25,326
    
    
    33,377


The Company will continue to prudently evaluate its contractual
obligations with respect to mineral properties as well as other associated
commitments with an eye towards deferring those expenses which do not meet
certain criteria. In addition, since the majority of the exploration commitments
are optional, the Company could choose to mitigate or eliminate the obligation
by opting out of the lease or claim.

Contingencies

Legal matters

One of the Companys subsidiaries, Energy Fuels Resources (USA)
Inc. (EFRI), entered into a unit price construction contract with KGL
Associates, Inc. (KGL) in 2009 relating to the construction of tailings
cell 4B at the Companys White Mesa Mill. EFRIs and KGLs performance of their
respective obligations under this contract was under dispute in an action
commenced in January 2011 in the Seventh Judicial District Court, San Juan
County, Utah. In the dispute: (a) EFRI sought approximately $3.25 million in
damages from KGL, including project completion costs as well as indemnity and
reimbursement from KGL for monies paid by EFRI to KGL subcontractors or
suppliers unpaid when KGL abandoned the project; (b) KGL sought payment of
approximately $1.65 million for alleged project labor and/or equipment
inefficiencies allegedly caused by EFRI or its engineer and to enforce its lien
against the Mill property; and (c) both parties sought pre-judgment interest,
attorney fees and costs. The parties agreed to resolve this matter in binding
arbitration. Under the Arrangement Agreement dated May 23, 2012 between the
Company and Denison Mines Corp., which was entered into in connection with the
acquisition by the Company of the Denison US Mining Division in June 2012,
Denison agreed to fully indemnify the Company in connection with this litigation
and will receive any proceeds from arbitration. On February 28, 2014 the
arbitrator found in favor of Denison and awarded damages, interest, attorneys
fees and costs to Denison in excess of $4.8 million in favor of Denison. On March
21, 2014 KGL filed a motion with the district court to vacate the award.
Denisons counsel is preparing Denisons response to that motion.

On April 25, 2013, the Colorado Department of Public Health and
Environment (CDPHE) re-issued the radioactive materials license (the
License) to the Company for the proposed Piñon Ridge Mill. On May 24,
2013, Sheep Mountain Alliance (SMA) and Rocky Mountain Wild
(RMW), two non-government organizations, filed a suit in Denver
District Court challenging the re-issuance of the License. On July 5, 2013, the
Company and CDPHE filed motions to dismiss a majority of the claims of SMA and
RMW. In September 2013, the court denied both motions to dismiss. In March,
2014, the Plaintiffs designated the record for the judicial appellate review in
Denver District Court. Now that the record has been designated, a briefing
schedule will be agreed to by the parties, and unless additional motions are
filed, briefing will commence fairly promptly, with the Plaintiffs filing the
opening briefs. If the appeal is successful, the likely outcome would be remand
of the License back to CDPHE for reconsideration consistent with the courts
ruling, with the possibility of further public input and/or procedural steps to
be taken, or possible withdrawal of the License.

On November 26, 2012, the Company was served with a Plaintiffs
Original Petition and Jury Demand in the District Court of Harris County, Texas,
claiming an unspecified amount of damages from the disease and injuries
resulting from mesothelioma from exposure to asbestos, which the Plaintiff
claims was contributed to by being exposed to asbestos products and dust from
asbestos products while working at the White Mesa Mill. The Plaintiff has also
named a number of manufacturers of asbestos and asbestos-related products in the
law suit. The Company does not consider this claim to have any merit, and
therefore does not believe it will materially affect the Companys financial position, results of operations or cash flows. Plaintiff has
produced a medical expert report, work history, and answers to discovery. On
January 28, 2013, the Company filed a Special Appearance to Challenge Personal
Jurisdiction, Motion to Transfer Venue, Motion to Dismiss for Forum Non
Conveniens and Original Answer Subject Thereto.

- 16 -

---

|ENERGY FUELS INC.                                                     
|----------------------------------------------------------------------
|Managements Discussion and Analysis                                  
|15 Months Ended December 31, 2013                                     
|(Expressed in
      thousands of U.S. Dollars, Unless Otherwise Noted)

On January 11, 2013, the Ute Mountain Ute tribe filed a
Petition to Intervene and Request for Agency Action challenging the Corrective
Action Plan approved by the State of Utah Department of Environmental Quality
(UDEQ) relating to nitrate contamination located in the shallow aquifer
at the Companys White Mesa Mill site. This challenge is currently being
evaluated by UDEQ and the Company, and may involve the appointment by UDEQ of an
Administrative Law Judge to hear this matter under Utah administrative
procedures. If appointed, the Administrative Law Judge will set a schedule for
further proceedings which will involve a hearing to resolve the challenge. After
the hearing, the judge will issue a recommended decision to the final agency
decision maker, the Director of UDEQ. An appeal can be taken from the Director's
decision to Utah's appellate courts. The Company does not consider this action
to have any merit. If the petition is successful, the likely outcome would be a
requirement for the Company and UDEQ to modify or replace the existing
Corrective Action Plan. At this time, the Company does not believe that any such
modification or replacement would materially affect the Companys financial
position, results of operations or cash flows. However, the scope and costs of
remediation under a revised or replacement Corrective Action Plan have not yet
been determined and could be significant.

On March 7, 2013, the Center for Biological Diversity, the
Grand Canyon Trust, the Sierra Club and the Havasupai Tribe (the
Plaintiffs) filed a complaint in the U.S. District Court for the
District of Arizona (the District Court) against the Forest Supervisor
for the Kaibab National Forest and the U.S. Forest Service (USFS,
collectively, the Defendants) seeking an order declaring that the USFS failed
to comply with environmental, mining, public land, and historic preservation
laws in relation to the Companys Canyon mine, and setting aside and vacating
any approvals and authorizations regarding exploration and mining operations at
the Canyon mine. In addition, the Plaintiffs sought injunctive relief directing
operations to cease at the mine and enjoining the USFS from authorizing or
allowing any further exploration or mining-related activities at the Canyon mine
until the USFS fully complies with all applicable laws. In April 2013, the
Plaintiffs filed a Motion for Preliminary Injunction to enjoin the Defendants
from allowing construction and/or mining activities to occur at the Canyon mine
and suspending all USFS approvals. This motion was denied by the District Court
on September 9, 2013. In October 2013 Plaintiffs appealed the District Courts
Order to the 9thCircuit Court of Appeals (the Court of
Appeals), and filed two Emergency Motions for an Injunction Pending
Appeal. In November 2013, the Company decided to place shaft sinking operations
on standby at the Canyon Mine, due to market conditions, and to simplify and
lessen the expense of the litigation at the mine. At the same time, the Company
entered into a stipulation agreement with Plaintiffs under which the Company
agreed to keep shaft sinking operations on standby until the earlier of the date
the District Court issues a final appealable order on the merits of Plaintiffs
claims, or December 31, 2014. In return, Plaintiffs agreed to stay their appeal
of the District Courts denial of their Motion for Preliminary Injunction in the
Court of Appeals, and the emergency motions related thereto. As a result of this
stipulation agreement, the Court of Appeals stayed Plaintiffs appeal and
emergency motions. Proceedings on the merits of the case are ongoing. If the
Plaintiffs are successful on the merits, the Company may be required to maintain
activities at the mine on standby for longer than otherwise planned, pending
resolution of the matter. Such a required prolonged stoppage of mine development
and mining activities could have a significant impact on the Company.

On August 19, 2011, the Companys subsidiary, Roca Honda
Resources, LLC (Roca Honda), filed an application for a permit to
dewater certain aquifers underlying Roca Hondas proposed uranium mine site. The
Pueblo of Acoma protested the permit application, and the proceeding was
assigned to an Office of the State Engineer Hearing Officer. The matter was set
for hearing on the merits commencing on November 12, 2013. On December 10, 2010,
the Hearing Officer issued a Report and Recommendation which recommended
approval of the application. The State Engineer adopted the Report and
Recommendation of the Hearing Examiner on December 10, 2013. On January 13, 2014
Acoma Pueblo challenged the State Engineers granting of the permit by (1)
filing a notice of appeal and (2) separately filing a Complaint. The notice of
appeal and Complaint were both filed in the Eleventh Judicial District Court of
McKinley County. The Company does not believe the appeal and Complaint have
merit and intends to defend against those actions. On March 14, 2014, the
Company filed a Motion to Dismiss the Complaint, on the basis that the appeal is
the exclusive remedy and that the Complaint is therefore not authorized under
law, is duplicative, wasteful and should be dismissed. If the appeal is
successful, the likely outcome would be remand of the permit back to the State
Engineer for reconsideration or possible withdrawal of the permit. At this time,
the Company does not believe that any such outcome would materially affect the
Companys financial position, results of operations or cash flows.

- 17 -

---

|ENERGY FUELS INC.                                                     
|----------------------------------------------------------------------
|Managements Discussion and Analysis                                  
|15 Months Ended December 31, 2013                                     
|(Expressed in
      thousands of U.S. Dollars, Unless Otherwise Noted)

The Company received a letter entitled Notice of Intent to Sue
Energy Fuels for Violations of the Clean Air Act at the White Mesa Uranium Mill
dated January 29, 2014. In the notice letter, the Grand Canyon Trust threatens
to file a Clean Air Act citizen suit in federal district court for
alleged violations of the National Emissions Standards for Hazardous Pollutants
(NESHAPs) Subpart W, which applies to uranium mills. The notice alleges
that radon from Cell 2 at the mill exceeds the 20 pCi/m2standard;
that the mill is in violation of the limitation to two operating tailings
impoundments; and that two tailings impoundments exceed a 40 acre size
limitation. No suit has been filed at this time, and can only be filed after 60
days have elapsed from service of the notice letter. In the notice letter, the
Grand Canyon Trust stated that it intends to ask the district court to impose
injunctive relief, civil penalties of up to $37,500 per day per violation, its
costs of litigation including attorneys fees, and other relief. The Company
does not believe the claims threatened in the notice letter have merit, and
intends to defend any lawsuit filed pursuant to the notice. The Company believes
the issues raised by this environmental group are either inaccurate or are being
addressed through the proper regulatory channels. Both Energy Fuels and the
regulatory authorities are well aware of these matters, and because they are
being addressed, no violations have been issued.

OFF-BALANCE SHEET ARRANGEMENTS

The Company does not have any off-balance sheet
arrangements.

DIVIDENDS

The Company has not paid dividends in the past and it does not
expect to pay dividends in the near future. If the Company generates earnings in
the future, it expects that they will be retained to finance further growth. The
directors of the Company will determine if and when dividends will be declared
and paid in the future based on the Companys financial position at the relevant
time.

OUTSTANDING SHARE DATA

At March 26, 2014, there were 19,683,472 common shares issued and
outstanding, 1,079,069 warrants issued and outstanding to purchase a total of
1,079,069 common
shares, and 1,082,912 stock options outstanding to purchase a total of 1,082,912 common shares
for a total of 21,845,453 common shares on a fully-diluted basis. In addition, at December
31, 2013, there were 22,000 Debentures outstanding, convertible into a total of
1,466,667common shares.

CONTROLS AND PROCEDURES

In compliance with the requirements of National Instrument
52-109, our Certifying Officers have reviewed and certified the Consolidated
Financial Statements for the 15 months ended December 31, 2013, together with
other financial information included in our securities filings. Our Certifying
Officers have also certified that disclosure controls and procedures
(DC&P) have been designed to provide reasonable assurance that
material information relating to our company is made known within our company.
Further, our Certifying Officers have certified that internal controls over
financial reporting (ICFR) have been designed to provide reasonable
assurance regarding the reliability of financial reporting and the preparation
of the Consolidated Financial Statements. Based on the evaluation of the design
and operating effectiveness of our company's DC&P and ICFR, our Certifying
Officers concluded that our company's DC&P and ICFR were effective as at
December 31, 2013.

During the 15 months ended December 31, 2013, there were no
changes in the Companys internal control over financial reporting that
materially affected, or are likely to materially affect, the Companys internal
control over financial reporting.

CORPORATE GOVERNANCE POLICIES

The disclosure required pursuant to National Instrument 58-101
 Disclosure of Corporate Governance Practices has been made by the Company in
its Management Information Circular dated March 26, 2014, which was made
available to shareholders and filed on SEDAR and EDGAR for internet access for
public viewing.

Critical accounting estimates and judgments

The preparation of these consolidated financial statements in
accordance with IFRS requires the use of certain critical accounting estimates
and judgments that affect the amounts reported. It also requires management to
exercise judgment in applying the Companys accounting policies. These judgments
and estimates are based on managements best knowledge of the relevant facts and
circumstances taking into account previous experience. Although the Company regularly reviews the estimates and
judgments made that affect these financial statements, actual results may be
materially different.

- 18 -

---

|ENERGY FUELS INC.                                                     
|----------------------------------------------------------------------
|Managements Discussion and Analysis                                  
|15 Months Ended December 31, 2013                                     
|(Expressed in
      thousands of U.S. Dollars, Unless Otherwise Noted)

Significant estimates made by management:

|a. | Reserves and resources
|-- | ----------------------

Proven and probable reserves are the economically mineable
parts of the Companys measured and indicated mineral resources demonstrated by
at least a preliminary feasibility study. The Company estimates its proven and
probable reserves and measured, indicated and inferred mineral resources based
on information compiled by appropriately qualified persons. The information
relating to the geological data on the size, depth and shape of the ore body
requires complex geological judgments to interpret the data. The estimation of
future cash flows related to proven and probable reserves is based upon factors
such as estimates of foreign exchange rates, commodity prices, future capital
requirements and production costs along with geological assumptions and
judgments made in estimating the size and grade of the ore body. Changes in the
proven and probable reserves or measured, indicated and inferred mineral
resources estimates may impact the carrying value of property, plant and
equipment, goodwill, reclamation and remediation obligations, recognition of
deferred tax amounts and depreciation, depletion and amortization.

|b. | Depreciation, depletion and amortization of property,
      plant and equipment
|-- | -------------------------------------------------------------------------------

Property, plant and equipment comprise a large component of the
Companys assets and, as such, the depreciation and amortization of those assets
have a significant effect on the Companys financial statements. Depreciation
and amortization of property, plant and equipment used in production is
calculated on a straight line basis or a unit-of-production basis as
appropriate.

Plant and equipment assets depreciated using a straight-line
basis results in the allocation of production costs evenly over the assets
useful life defined as a period of time. Plant and equipment assets depreciated
on a units-of-production basis results in the allocation of production costs
based on current period production in proportion to total anticipated production
from the facility.

Mineral property assets are amortized using a
unit-of-production basis that allocates the cost of the asset to production cost
based on the current periods mined ore as a proportion of the total estimated
resources in the related ore body. The process of making these estimates
requires significant judgment in evaluating and assessing available geological,
geophysical, engineering and economic data, projected rates of production,
estimated commodity price forecasts and the timing of future expenditures, all
of which are, by their very nature, subject to interpretation and uncertainty.

Changes in these estimates may materially impact the carrying
value of the Companys property, plant and equipment and the recorded amount of
amortization, depletion and depreciation.

|c. | Valuation of long-lived
assets
|-- | ------------------------------

The Company undertakes a review of the carrying values of
property, plant and equipment and intangibles whenever events or changes in
circumstances indicate that their carrying values may exceed their estimated net
recoverable amounts determined by reference to estimated future operating
results and discounted net cash flows. An impairment loss is recognized when the
carrying value of those assets is not recoverable. In undertaking this review,
the management of the Company is required to make significant estimates of,
amongst other things, future production and sale volumes, forecast commodity
prices, future operating and capital costs and reclamation costs to the end of
the mine or mills life. These estimates are subject to various risks and
uncertainties, which may ultimately have an effect on the expected
recoverability of the carrying values of plant, property and equipment and
intangibles.

|d. | Business combinations
|-- | ---------------------

Management uses judgment in applying the acquisition method of
accounting for business combinations and in determining fair values of the
identifiable assets and liabilities acquired. The value placed on the acquired
assets and liabilities, including identifiable intangible assets, will have an
effect on the amount of goodwill or bargain purchase gain that the Company may
record on an acquisition. Changes in economic conditions, commodity prices and
other factors between the date that an acquisition is announced and when it
finally is consummated can have a material difference on the allocation used to record a preliminary
purchase price allocation versus the final purchase price allocation which can
take up to one year after acquisition to complete.

- 19 -

---

|ENERGY FUELS INC.                                                     
|----------------------------------------------------------------------
|Managements Discussion and Analysis                                  
|15 Months Ended December 31, 2013                                     
|(Expressed in
      thousands of U.S. Dollars, Unless Otherwise Noted)

|   |                            
|-- | ---------------------------
|e. | Decommissioning
liabilities

Decommissioning liabilities are recorded as a liability when
the asset is initially constructed. The Company has accrued its best estimate of
its share of the cost to decommission its mining and milling properties in
accordance with existing laws, contracts and other policies. The estimate of
future costs involves a number of estimates relating to timing, type of costs,
mine closure plans, and review of potential methods and technical advancements.
Furthermore, due to uncertainties concerning environmental remediation, the
ultimate cost of the Companys decommissioning liability could differ from
amounts provided. The estimate of the Companys obligation is subject to change
due to amendments to applicable laws and regulations and as new information
concerning the Companys operations becomes available. The Company is not able
to determine the impact on its financial position, if any, of environmental laws
and regulations that may be enacted in the future.

|f. | Determination of significant
  influence
|-- | ----------------------------------------

Management determines its ability to exercise significant
influence over an investment in shares of other companies by looking at its
percentage interest and other qualitative factors including but not limited to
its voting rights, representation on the board of directors, participation in
policy-making processes material transactions between the Company and the
associate, interchange of managerial personnel, provision of essential technical
information and operating involvement.

|g. | Determination whether an acquisition represents a
      business combination or asset purchase
|-- | ----------------------------------------------------------------------------------------------

Management determines whether an acquisition represent a
business combination or asset purchase by considering the stage of exploration
and development of an acquired operation. Consideration is given to whether the
acquired properties include mineral reserves or mineral resources, in addition
to the permitting required and results of economic assessments.

Future Accounting Changes

IFRS 9 Financial Instruments

This standard replaces IAS 39, Financial Instruments:
Recognition and Measurement, in phases. IFRS 9 (2009) reflects the IASB's first
phase of the project relating to the classification and measurement of financial
assets. Under IFRS 9 (2009), financial assets are classified and measured based
on the business model in which they were held and the characteristics of their
contractual cash flows. IFRS 9 (2010) provides guidance on the classification
and measurement of financial liabilities and the requirements of IAS 39 for the
de-recognition of financial assets and liabilities. IFRS 9 (2013) introduces a
new general hedge accounting model which provides guidance on the eligibility of
hedging instruments and hedged items, accounting for the time value component of
options, qualifying criteria for applying hedge accounting, modification and
discontinuation of hedging relationships, and required disclosures. In
subsequent phases, the IASB plans to make limited amendments to the
classification and measurement requirements of IFRS 9 and to add new
requirements to address macro hedge accounting and impairment of financial
assets. The IASB tentatively decided to require an entity to apply IFRS 9 for
annual periods beginning on or after January 1, 2018. We do not intend to adopt
this standard early due to possible further changes in the standard before it
becomes final.

IFRS 13 Fair Value Measurement

In May 2011, the IASB issued IFRS 13 Fair Value Measurement
(IFRS 13), which is effective for annual periods beginning on or after
January 1, 2013, with early application permitted. IFRS 13 defines fair value,
sets out in a single standard a framework for measuring fair value, requires
disclosures about fair value measurements, and applies when other IFRSs require
or permit fair value measurements. IFRS 13 does not introduce requirements to
measure assets or liabilities at fair value, nor does it eliminate practicable
exception to fair value measurement that currently exist in certain standards.
The Company has not yet assessed the impact of the Standard on the consolidated
financial statements.

- 20 -

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|ENERGY FUELS INC.                                                     
|----------------------------------------------------------------------
|Managements Discussion and Analysis                                  
|15 Months Ended December 31, 2013                                     
|(Expressed in
      thousands of U.S. Dollars, Unless Otherwise Noted)

Amendments to IAS 32, Financial Instruments:
Presentation

Clarifies that an entity currently has a legally enforceable
right to off-set financial assets and liabilities if that right is: not
contingent on a future event; and enforceable both in the normal course of
business and in the event of default, insolvency or bankruptcy of the entity and
all counterparties. The amendments to IAS 32 also clarify when a settlement
mechanism provides for net settlement or gross settlement that is equivalent to
net settlement. The effective date for the amendments to IAS 32 is annual
periods beginning on or after January 1, 2014. The amendments to IAS 32 are to
be applied retrospectively. The Company intends to adopt the amendments to IAS
32 in its financial statements for the annual period beginning January 1, 2014.
The Company does not expect the amendments to IAS 32 to have a material impact
on the financial statements.

"IFRIC Interpretation 21, Levies:

This interpretation of IAS 37, Provisions, Contingent
Liabilities, and Contingent Assets, is effective January 1, 2014 and clarifies
that a liability for a levy should be recognized when the activity that triggers
payment, as identified by the relevant legislation, occurs. We are currently
evaluating the impact of adopting this interpretation on our consolidated
financial statements."

ENVIRONMENTAL RESPONSIBILITY

Energy Fuels periodically reviews the anticipated costs of
decommissioning and reclaiming its mill and mine sites as part of its
environmental planning process. Further, the Company formally reviews the White
Mesa Mills reclamation estimate annually with applicable regulatory
authorities. The undiscounted mill and mine reclamation estimates at December
31, 2013 are $26.78 million, which are expected to be sufficient to cover the
projected future costs for reclamation of the White Mesa Mill and mine
operations. However, there can be no assurance that the ultimate cost of such
reclamation obligations will not exceed the estimated liability contained in the
Companys financial statements.

The Company has posted cash bonds and surety bonds supported by
collateralized trust funds as security for these liabilities. At December 31,
2013, the amount of these restricted cash and investments collateralizing the
Companys reclamation obligations was $25.48 million. As a result of a change in
bonding companies, in January 2014 the restricted cash and investments
collateralizing the Companys reclamation obligations was reduced to $16.41
million.

Prior to Energy Fuels acquisition of the US Mining Division,
chloroform contamination was detected at the White Mesa 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,
and from septic drain fields that were used for laboratory and sanitary wastes
prior to construction of the mills tailings cells. In April 2003, Denison
commenced an interim remedial program of pumping the chloroform contaminated
water from the groundwater to the mills tailings cells. This will enable Energy
Fuels to begin cleanup of the contaminated areas and to take a further step
towards resolution of this outstanding issue. Pumping from the wells continued
in 2013. Energy Fuels is continuing to work with the State of Utah to develop a
long-term Corrective Action Plan. A draft of the Corrective Action Plan is
currently being reviewed by the State. While the investigations to date indicate
that this chloroform contamination appears to be contained in a manageable area,
the scope and costs of final remediation have not yet been determined and could
be significant.

Elevated concentrations of nitrate and chloride were observed
in some monitoring wells at the White Mesa Mill site in2008 a number of which
are upgradient of the mills tailings cells. Pursuant to a Stipulated Consent
Agreement with UDEQ, Denison retained INTERA, Inc., an independent professional
engineering firm, to investigate these elevated concentrations and to prepare a
Contamination Investigation Report for submittal to UDEQ. The investigation was
completed in 2009, and the Contamination Investigation Report was submitted to
UDEQ in January 2010. INTERA concluded in the Report that: (1) the nitrate and
chloride are co-extensive and appear to originally come from the same source;
and (2) the source is upgradient of the mill property and is not the result of
Mill activities. UDEQ reviewed the Report, and concluded that further
investigations were required before it could determine the source of the
contamination and the responsibility for cleanup. Such investigations were
performed in 2010 and 2011, but were considered to be inconclusive by UDEQ. As a
result, after the investigations, it has been determined that there are site
conditions that make it difficult to ascertain the source(s) of contamination at
the site, and that it has therefore not been possible to date to determine the
source(s), causes(s), attribution, magnitudes of contribution, and proportion(s)
of the local nitrate and chloride in groundwater. For those reasons, UDEQ has
decided that it cannot eliminate mill activities as a potential cause, either in
full or in part, of the contamination. The Company and UDEQ have therefore
agreed that resources are better spent in developing a Corrective Action Plan,
rather than continuing with further investigations as to the source(s) and
attribution of the groundwater contamination. Pursuant to a revised Stipulated Consent Agreement, Denison submitted to UDEQ in November 2011 a
draft Corrective Action Plan for remediation of the contamination, which
involves a program of pumping the nitrate contaminated groundwater to the mills
tailings cells, similar to the chloroform remedial program. UDEQ approved the
Corrective Action Plan on December 12, 2012.In accordance with the Plan, in 2013
the Company commenced pumping nitrate/chloride contaminated water from four
monitoring wells for discharge into the Mills process or tailings cells and has
completed certain characterization activities. Although the contamination
appears to be contained in a manageable area, the scope and costs of final
remediation have not yet been determined and could be significant.

- 21 -

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|ENERGY FUELS INC.                                                     
|----------------------------------------------------------------------
|Managements Discussion and Analysis                                  
|15 Months Ended December 31, 2013                                     
|(Expressed in
      thousands of U.S. Dollars, Unless Otherwise Noted)

During 2011 and 2012, the White Mesa Mill reported consecutive
exceedances of groundwater compliance limits (GWCLs) under the White
Mesa Mills Groundwater Discharge Permit (GWDP) for several
constituents in several wells, and there are decreasing trends in pH in a number
of wells across the site that have caused the pH in a number of compliance
monitoring wells to have dropped below their GWCLs. These exceedances and pH
trends include wells that are up-gradient of the Mill facilities, far
down-gradient of the Mill site and at the site itself. These consecutive
exceedances of GWCLs have resulted in violations of the GWDP. A Source
Assessment Report was submitted in 2013 addressing each exceedance and the
decreasing trends in pH at the site. UDEQ has accepted the Source Assessment
Report, and has concluded that such exceedances and decreasing trends in pH are
due to natural background influences at the site. UDEQ has agreed to revise the
GWCLs to account for these background influences, which would put those
constituents, including pH at the site, back into compliance.

The White Mesa Mill monitors radon flux from tailings Cells 2
and 3 to comply with the NESHAPs requirements of the Clean Air Act. The radon
flux from Cell 2 exceeded the regulatory threshold beginning with the June 2012
sampling event and continued to climb during subsequent sampling events, which
is believed to be due to the aggressive dewatering of the slimes drain solution
level in Cell 2 to comply with the Mills GWDP. Consistent with the regulations,
the Company initiated monthly monitoring of Cell 2 radon flux in April 2013. In
order to address the Cell 2 radon exceedances, in 2013 the Company commenced
placement of additional cover materials over areas showing high radon emissions,
to mitigate the radon flux from Cell 2. Current monthly monitoring indicates that
the radon flux from Cell 2 has dropped below the compliance threshold and is now
in compliance.

RESEARCH AND DEVELOPMENT

The Company does not have a formal research and development
program. Process development efforts expended in connection with processing
alternate feed materials 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 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.

MANAGEMENT OF CAPITAL

The Companys objectives when managing capital are to safeguard
the Companys ability to continue as a going concern in order to maintain the
Companys production capabilities, pursue the permitting, development and
exploration of its mineral properties, and to maintain a flexible capital
structure which optimizes the costs of capital at an acceptable risk.

The Company depends on current production and sales as well as
external financing to fund its activities. In the past, the Company depended
entirely on external financing to fund operating and development activities. The
capital structure of the Company currently consists of cash and cash
equivalents, inventory, common shares, Debentures, warrants, and stock options.
Changes in the equity accounts of the Company are disclosed in Note 18of the
audited financial statements. The Company manages the capital structure and
makes adjustments to it in light of changes in economic conditions and the risk
characteristics of the underlying assets. To maintain or adjust the capital
structure, the Company may issue new shares. The Company may require access to
equity and credit markets to fund continued production, exploration and
development of its mineral properties and the future growth of the business. The
Company is not subject to externally imposed capital requirements. In order to
facilitate the management of its capital requirements, the Company prepares
annual expenditure budgets, which are approved by the Board of Directors and
updated as necessary depending on various factors, including capital deployment
and general industry conditions.

The Company is required by regulatory agencies to provide
surety bonds totaling$26.8 million to cover the estimated reclamation costs for
mining, milling, exploration and development, including the White Mesa Mill
decommissioning obligation and the decommissioning obligations at the Companys
other mines.

- 22 -

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|ENERGY FUELS INC.                                                     
|----------------------------------------------------------------------
|Managements Discussion and Analysis                                  
|15 Months Ended December 31, 2013                                     
|(Expressed in
      thousands of U.S. Dollars, Unless Otherwise Noted)

ADDITIONAL IFRS FINANCIAL PERFORMANCE MEASURES

The Company has included the additional IFRS measure Earnings
(loss) from mine operations in the financial statements. Management noted that
Gross Profit provides useful information to investors as an indication of the
Companys principal business activities before consideration of how those
activities are financed, sustaining capital expenditures, corporate and
exploration and evaluation expenses, finance income and costs, and taxation.

FINANCIAL INSTRUMENTS AND RISK MANAGEMENT

(a) Fair value hierarchy:

Financial instruments recorded at fair value on the balance
sheet are classified using a fair value hierarchy that reflects the significance
of the inputs used in making the measurements. The three levels of fair value
hierarchy are:

Level 1  Reflects inputs based on
quoted prices in active markets for identical assets or liabilities.Level 2
 Reflects inputs other than quoted prices that are observable for the asset or
liability either directly or indirectly.Level 3  Reflects inputs that are
not based on observable market data.

The following table illustrates the classification of the
Companys financial instruments within the fair value hierarchy as of December
31, 2013:

|                       |   | Level 1 |  |   | Level 2 |  |   | Level 3 |  |   | Total  | 
|---------------------- | - | ------- |  | - | ------- |  | - | ------- |  | - | ------ | 
|Marketable securities  |   | 409     |  |   | -       |  |   | -       |  |   | 409    | 
|Convertible debentures |   | 17,478  |  |   | -       |  |   | -       |  |   | 17,478 | 
|                       | $ | 17,887  |  | $ | -       |  | $ | -       |  | $ | 17,887 | 

(b) Fair values:

As at December 31, 2013, the fair values of cash and cash
equivalents, restricted cash, short-term deposits, receivables, accounts payable
and accrued liabilities approximate their carrying values because of the
short-term nature of these instruments.

(c) Credit Risk:

Credit risk relates to cash and cash equivalents and trade and
other receivables and arises from the possibility that any counterparty to an
instrument fails to perform. The Company only transacts with highly-rated
counterparties, and a limit on contingent exposure has been established for any
counterparty based on that counterpartys credit rating. The Companys sales are
attributable mainly to three large utility companies. As at December 31, 2013,
the Companys maximum exposure to credit risk was the carrying value of cash and
cash equivalents, trade receivables and taxes recoverable.

At December 31, 2013 and September 30, 2012 there were $0.59
million and $15.27 million, respectively, in trade and other receivables that
were neither past due nor impaired.

(d) Liquidity Risk:

Liquidity risk is the risk the Company will not be able to meet
the obligations associated with its financial liabilities. The Company manages
liquidity risk through the management of its capital structure as outlined in
Note 15 and 17. The Company has $33.48 million of working capital as at December
31, 2013 (September 30, 2012 - $41.93 million). Accounts payable and accrued
liabilities, current portion of notes payable and current taxes payable are due
within the current operating period. The Companys financial liabilities and
other commitments are listed in note 22.

- 23 -

---

|ENERGY FUELS INC.                                                     
|----------------------------------------------------------------------
|Managements Discussion and Analysis                                  
|15 Months Ended December 31, 2013                                     
|(Expressed in
      thousands of U.S. Dollars, Unless Otherwise Noted)

The following are the contractual maturities of financial
liabilities (undiscounted) outstanding as at December 31, 2013

< 1 year
    
    
    1 to 2 years
    
    
    2 to 5 years
    
    
    Thereafter
    
    
    TotalAccounts payable and accrued
      liabilities
    $
    5,441
    
    $
    -
    
    $
    -
    
    $
    -
    
    $
    5,441Loans and borrowings
    $
    2,033
    
    $
    2,033
    
    $
    23,594
    
    $
    -
    
    
    27,660$
    7,474
    
    $
    2,033
    
    $
    23,594
    
    $
    -
    
    $
    33,101


(e) Foreign Currency Risk:

The foreign exchange risk relates to the risk that the value of
financial commitments, recognized assets or liabilities will fluctuate due to
changes in foreign currency rates. The Company does not use any derivative
instruments to reduce its exposure to fluctuations in foreign currency exchange
rates.

The following table summarizes, in United States dollar
equivalents, the Companys major foreign currency exposures as of December 31,
2013:

|Cash
      and cash equivalents          | $ | 5,490   |  
|---------------------------------------- | - | ------- | -
|Accounts payable and accrued liabilities |   | (907    | )
|Loans and borrowings                     |   | (17,478 | )
|Total                                    | $ | (12,895 | )

The table below summarizes a sensitivity analysis for
significant unsettled currency risk exposure with respect to the Companys
financial instruments as at December 31, 2013 with all other variables held
constant. It shows how net income would have been affected by changes in the
relevant risk variable that were reasonably possible at that date.

|                           |  | Change for                |  |       | Increase (decrease) in other | 
|-------------------------- |  | ------------------------- |  | ----- | ---------------------------- | 
|                           |  | Sensitivity Analysis      |  |       | comprehensive income         | 
|Strengthening net earnings |  | +1% change in U.S. dollar |  | $     | 254                          | 
|                           |  |                           |  |       |                              | 
|Weakening net earnings     |  | -1% change in U.S. dollar |  | **$** | (254)                        | 

(f) Interest rate risk:

The Company is also exposed to in interest rate risk associated
with the Debentures which is based on the spot market price of U3O8. The Company
does not use derivatives to manage interest rate risk. The following chart
displays the interest rate at various U3O8 price levels.

- 24 -

---

|ENERGY FUELS INC.                                                     
|----------------------------------------------------------------------
|Managements Discussion and Analysis                                  
|15 Months Ended December 31, 2013                                     
|(Expressed in
      thousands of U.S. Dollars, Unless Otherwise Noted)

|UxC U3O8 Weekly Indicator Price |  | Annual Interest Rate | 
|------------------------------- |  | -------------------- | 
|                                |  |                      | 
|Up to $54.99                    |  | 8.50%                | 
|$55.00  $59.99                 |  | 9.00%                | 
|$60.00  $64.99                 |  | 9.50%                | 
|$65.00  $69.99                 |  | 10.00%               | 
|$70.00  $74.99                 |  | 10.50%               | 
|$75.00  $79.99                 |  | 11.00%               | 
|$80.00  $84.99                 |  | 11.50%               | 
|$85.00  $89.99                 |  | 12.00%               | 
|$90.00  $94.99                 |  | 12.50%               | 
|$95.00  $99.99                 |  | 13.00%               | 
|$100 and above                  |  | 13.50%               | 

(g) Capital management:

The Companys objectives, when managing capital, are to
safeguard cash as well as maintain financial liquidity and flexibility in order
to preserve its ability to meet financial obligations and deploy capital to
develop its mining properties into production and to maintain investor, creditor
and market confidence to sustain the future development of the business. The
Company considers its capital structure to include share capital and working
capital.

The Companys financial strategy is designed to maintain a
flexible capital structure consistent with the objectives stated above and to
respond to business growth opportunities and changes in economic conditions. In
order to maintain or adjust its capital structure, the Company may, from time to
time, issue new shares, issue new debt (secured, unsecured, convertible and/or
other types of debt instruments), acquire or dispose of assets or adjust its
capital spending to manage its ability to continue as a going concern.

As of December 31, 2013, the Company is not subject to any
externally imposed capital requirements.

RISK FACTORS

There are a number of factors that could negatively affect
Energy Fuels business and the value of Energy Fuels common shares, including
the factors listed below. The following information pertains to the outlook and
conditions currently known to Energy Fuels that could have a material impact on
the financial condition of the Company. This information, by its nature, is not
all inclusive. It is not a guarantee that other factors will not affect Energy
Fuels in the future.

Uranium and Vanadium Price Fluctuations

The results of the Companys operations are significantly
affected by the market price of uranium and vanadium which are cyclical and
subject to substantial price fluctuations. The Companys earnings and operating
cash flow are and will be particularly sensitive to the change in the long and
short term market price of uranium and vanadium. Among other factors, these
prices also affect the value of the Companys reserves and inventories and the
market price of the Companys common shares.

Market prices are affected by numerous factors beyond the
Companys control. With respect to uranium, such factors include, among others:
demand for nuclear power, political and economic conditions in uranium producing
and consuming countries, public and political response to a nuclear incident,
reprocessing of used reactor fuel, the re-enrichment of depleted uranium tails
and the enricher practice of underfeeding, sales of excess civilian and military
inventories (including from the dismantling of nuclear weapons and from the
build-up of Japanese utility uranium inventories as a result of the Fukushima
incident) by governments and industry participants, uranium supply, including
the supply from other secondary sources and production levels and costs of
production. With respect to vanadium, such factors include, among others: demand
for steel, political and economic conditions in vanadium producing and consuming
countries, world production levels and costs of production. Other factors
include levels of supply and demand for a broad range of industrial products,
substitution of new or different products in critical applications for the
Companys existing products, expectations with respect to the rate of inflation,
the relative strength of the US dollar and of certain other currencies, interest
rates, global or regional political or economic crises and sales of uranium and
vanadium by holders in response to such factors. If prices should decline below
the Companys cash costs of production and remain at such levels for any
sustained period, the Company may determine that it is not economically feasible
to continue commercial production at any or all of the Companys mines or other
facilities and may also be required to look for alternatives other than cash
flow to maintain the Companys liquidity until prices recover. The Companys
expected levels of production and business activity are dependent on the
Companys and industrys expectations of uranium and vanadium prices, which may
not be realized or may change. In the event the Company concludes that a
significant deterioration in expected future uranium prices has occurred, the
Company will assess whether an impairment allowance is necessary which, if
required, could be material.

- 25 -

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|ENERGY FUELS INC.                                                     
|----------------------------------------------------------------------
|Managements Discussion and Analysis                                  
|15 Months Ended December 31, 2013                                     
|(Expressed in
      thousands of U.S. Dollars, Unless Otherwise Noted)

The recent fluctuations in the price of many commodities is an
example of a situation over which the Company has no control and which could
materially adversely affect the Company in a manner for which it may not be able
to compensate. There can be no assurance that the price of any minerals produced
from the Companys properties will be such that any deposits can be mined at a
profit.

The Companys profitability is directly related to the market
price of uranium and vanadium produced. The Company may from time to time
undertake commodity and currency hedging programs, with the intention of
maintaining adequate cash flows and profitability to contribute to the long term
viability of the business. The Company anticipates selling forward in the
ordinary course of business if, and when, the Company has sufficient assets and
production to support forward sale arrangements. There are, however, risks
associated with forward sale programs. If the Company does not have sufficient
production to meet its forward sale commitments, it may have to buy or borrow
(for later delivery back from production) sufficient product in the spot market
to deliver under the forward sales contracts, possibly at higher prices than
provided for in the forward sales contracts. Although the Company employs
various pricing mechanisms within its sales contracts to manage its exposure to
price fluctuations, there can be no assurance that such mechanisms will be
successful.

Global Economic Downturn

In the event of a continued general economic downturn or a
recession, there can be no assurance that the business, financial condition and
results of operations of the Company would not be materially adversely affected.
Current global financial conditions have been subject to increased volatility,
and numerous commercial and financial enterprises have either gone into
bankruptcy or creditor protection or have had to be rescued by governmental
authorities. Access to public financing has been negatively impacted by
sub-prime mortgage defaults in the United States, the liquidity crisis affecting
the asset-backed commercial paper and collateralized debt obligation markets,
massive investment losses by banks with resultant recapitalization efforts and a
deterioration in the global economy. Although economic conditions have shown
improvement in recent years, the recovery from the recession has been slow in
various jurisdictions including in Europe and the United States and has been
impacted by various ongoing factors including sovereign debt levels and high
levels of unemployment, which continue to impact commodity prices and which have
resulted in high volatility in currencies and global debt and stock markets.

These factors may impact the Companys ability to obtain
equity, debt or bank financing on terms commercially reasonable to the Company,
or at all. Additionally, these factors, as well as other related factors, may
cause decreases in asset values that are deemed to be other than temporary,
which may result in impairment losses. If these increased levels of volatility
and market turmoil continue, or there is a material deterioration in general
business and economic conditions, the Companys operations could be adversely
impacted and the trading price of the Companys securities could continue to be
adversely affected.

Market Price of Shares

Securities of mining companies have experienced substantial
volatility in the past, often based on factors unrelated to the financial
performance or prospects of the companies involved. These factors include
macroeconomic conditions in North America and globally, and market perceptions
of the attractiveness of particular industries. The price of the Companys
securities is also likely to be significantly affected by short-term changes in
uranium and vanadium prices, changes in industry forecasts of uranium and
vanadium prices, other mineral prices, currency exchange fluctuation, or in its
financial condition or results of operations as reflected in its periodic
earnings reports. Other factors unrelated to the performance of the Company that
may have an effect on the price of the securities of the Company include the following: the extent of analytical coverage available to
investors concerning the business of the Company may be limited if investment
banks with research capabilities do not follow the Companys securities;
lessening in trading volume and general market interest in the Companys
securities may affect an investor's ability to trade significant numbers of
securities of the Company; the size of the Companys public float and its
inclusion in market indices may limit the ability of some institutions to invest
in the Company's securities; and a substantial decline in the price of the
securities of the Company that persists for a significant period of time could
cause the Companys securities to be delisted from an exchange, further reducing
market liquidity. If an active market for the securities of the Company does not
continue, the liquidity of an investor's investment may be limited and the price
of the securities of the Company may decline. If an active market does not
exist, investors may lose their entire investment in the Company. As a result of
any of these factors, the market price of the securities of the Company at any
given point in time may not accurately reflect the long-term value of the
Company. Securities class-action litigation often has been brought against
companies following periods of volatility in the market price of their
securities. The Company may in the future be the target of similar litigation.
Securities litigation could result in substantial costs and damages and divert
management's attention and resources.

- 26 -

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|ENERGY FUELS INC.                                                     
|----------------------------------------------------------------------
|Managements Discussion and Analysis                                  
|15 Months Ended December 31, 2013                                     
|(Expressed in
      thousands of U.S. Dollars, Unless Otherwise Noted)

Governmental Regulation and Policy Risks

Exploration, development, mining and milling of minerals and
the transportation and handling of the products produced are subject to
extensive federal, state and local laws and regulations governing, among other
things, acquisition of the mining interests, maintenance of claims, tenure,
expropriation, prospecting, exploration, development, mining, milling and
production, price controls, exports, imports, taxes and royalties, labor
standards, occupational health, waste disposal, toxic substances, water use,
land use, Native American land claims, environmental protection and remediation,
endangered and protected species, mine and mill decommissioning and reclamation,
mine safety, transportation safety and emergency response and other matters.
Compliance with such laws and regulations has increased the costs of exploring,
drilling, developing, constructing, operating and closing the Companys mines
and processing facilities. It is possible that, in the future, the costs, delays
and other effects associated with such laws and regulations may impact the
Companys decision as to whether to operate existing mines, or, with respect to
exploration and development properties, whether to proceed with exploration or
development, or that such laws and regulations may result in the Company
incurring significant costs to remediate or decommission properties that do not
comply with applicable environmental standards at such time. The Company expends
significant financial and managerial resources to comply with such laws and
regulations. The Company anticipates it will have to continue to do so as the
historic trend toward stricter government regulation may continue. There can be
no assurance that future changes in applicable laws and regulations will not
adversely affect the operations or financial condition of the Company. New laws
and regulations, amendments to existing laws and regulations or more stringent
implementation of existing laws and regulations, including through stricter
license and permit conditions, could have a material adverse impact on the
Company, increase costs, cause a reduction in levels of, or suspension of,
production and/or delay or prevent the development of new mining properties.

Mining is subject to potential risks and liabilities associated
with pollution of the environment and the disposal of waste products occurring
as a result of mineral exploration, mining and production. Environmental
liability may result from mining activities conducted by others prior to the
Companys ownership of a property. Failure to comply with applicable laws,
regulations and permitting requirements may result in enforcement actions. These
actions may result in orders issued by regulatory or judicial authorities
causing operations to cease or be curtailed, and may include corrective measures
requiring capital expenditures, installation of additional equipment or remedial
actions. Companies engaged in uranium exploration operations may be required to
compensate others who suffer loss or damage by reason of such activities and may
have civil or criminal fines or penalties imposed for violations of applicable
laws or regulations. Should the Company be unable to fully fund the cost of
remedying an environmental problem, it might be required to suspend operations
or enter into interim compliance measures pending completion of the required
remedy, which could have a material adverse effect on the Company. To the extent
that the Company is subject to uninsured environmental liabilities, the payment
of such liabilities would reduce otherwise available earnings and could have a
material adverse effect on the Company. In addition, the Company does not have
coverage for certain environmental losses and other risks as such coverage
cannot be purchased at a commercially reasonable cost. Compliance with
applicable environmental laws and regulations requires significant expenditures
and increases mine development and operating costs

- 27 -

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|ENERGY FUELS INC.                                                     
|----------------------------------------------------------------------
|Managements Discussion and Analysis                                  
|15 Months Ended December 31, 2013                                     
|(Expressed in
      thousands of U.S. Dollars, Unless Otherwise Noted)

Worldwide demand for uranium is directly tied to the demand for
electricity produced by the nuclear power industry, which is also subject to
extensive government regulation and policies. The development of mines and
related facilities is contingent upon governmental approvals that are complex
and time consuming to obtain and which, depending upon the location of the
project, involve multiple governmental agencies. The duration and success of such approvals are subject to many variables outside the
Companys control. Any significant delays in obtaining or renewing such permits
or licenses in the future could have a material adverse effect on the Company.
In addition, the international marketing of uranium is subject to governmental
policies and certain trade restrictions, such as those imposed by the suspension
agreement between the United States and Russia. Changes in these policies and
restrictions may adversely impact the Companys business.

Public Acceptance of Nuclear Energy and Competition from
Other Energy Sources

Growth of the uranium and nuclear industry will depend upon
continued and increased acceptance of nuclear technology as a means of
generating electricity. Because of unique political, technological and
environmental factors that affect the nuclear industry, including the risk of a
nuclear incident, the industry is subject to public opinion risks that could
have an adverse impact on the demand for nuclear power and increase the
regulation of the nuclear power industry. Nuclear energy competes with other
sources of energy, including oil, natural gas, coal and hydro-electricity. These
other energy sources are to some extent interchangeable with nuclear energy,
particularly over the longer term. Sustained lower prices of oil, natural gas,
coal and hydroelectricity may result in lower demand for uranium concentrates.
Technical advancements in renewable and other alternate forms of energy, such as
wind and solar power, could make these forms of energy more commercially viable
and put additional pressure on the demand for uranium concentrates.

Uranium Industry Competition and International Trade
Restrictions

The international uranium industry, including the supply of
uranium concentrates, is competitive. The Company markets uranium in direct
competition with supplies available from a relatively small number of uranium
mining companies, from excess inventories, including inventories made available
from decommissioning of nuclear weapons, from reprocessed uranium and plutonium,
from used reactor fuel, and from the use of excess Russian enrichment capacity
to re-enrich depleted uranium tails held by European enrichers in the form of
UF6. The supply of uranium from Russia and from certain republics of the former
Soviet Union is, to some extent, impeded by a number of international trade
agreements and policies. 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 and
Europe, which are the largest markets for uranium in the world.

Ability to Maintain Obligations Under Debentures and
Other Debt

The Company may from time to time enter into arrangements to
borrow money in order to fund its operations and expansion plans, and such
arrangements may include covenants that restrict its business in some way.
Events may occur in the future, including events out of the Companys control
that would cause the Company to fail to satisfy its obligations under its
existing Debentures or other debt instruments. In such circumstances, or if the
Company were to default on its obligations under the Debentures or other debt
instruments, the amounts drawn under the Companys debt agreements may become
due and payable before the agreed maturity date, and the Company may not have
the financial resources to repay such amounts when due.

Further, although most, but not all, of the Companys
reclamation obligations are bonded, and cash and other assets of the Company
have been reserved to secure a portion but not all of this bonded amount, to the
extent the bonded amounts are not fully collateralized, the Company will be
required to come up with additional cash to perform its reclamation obligations
when they occur. In addition, the bonding companies have the right to require
increases in collateral at any time upon 30-days notice to the Company, failure
of which would constitute a default under the bonds. In such circumstances, the
Company may not have the financial resources to perform such reclamation
obligations or to increase such collateral when due.

Additional Funding Requirements

The Company may need additional financing in connection with
the implementation of its business and strategic plans from time to time. The
exploration and development of mineral properties and the ongoing operation of
mines, requires a substantial amount of capital and may depend on the Companys
ability to obtain financing through joint ventures, debt financing, equity
financing or other means. The Company may accordingly have further capital
requirements to take advantage of further opportunities or acquisitions. The
Companys financial condition, general market conditions, volatile uranium and
vanadium markets, volatile interest rates, a claim against the Company, a
significant disruption to the Companys business or operations or other factors
may make it difficult to secure financing necessary for the expansion of mining
activities or to take advantage of opportunities for acquisitions.

- 28 -

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|ENERGY FUELS INC.                                                     
|----------------------------------------------------------------------
|Managements Discussion and Analysis                                  
|15 Months Ended December 31, 2013                                     
|(Expressed in
      thousands of U.S. Dollars, Unless Otherwise Noted)

Further, continuing volatility in the credit markets may
increase costs associated with debt instruments due to increased spreads over
relevant interest rate benchmarks, or affect the ability of the Company, or
third parties it seeks to do business with, to access those markets. There is no
assurance that the Company will be successful in obtaining required financing as
and when needed on acceptable terms, if at all.

Dilution from Further Equity Financing

If the Company raises additional funding by issuing
additional equity securities or securities convertible, exercisable or
exchangeable for equity securities, such financing may substantially dilute the
interests of shareholders of the Company and reduce the value of their
investment.

Nature of Exploration and Development, Expansion Projects
and Restarting Projects

The exploration and development of mineral deposits, the
expansion of projects and restarting projects involves significant financial
risks. Development of any of the exploration properties in which the Company has
an interest will only follow upon obtaining satisfactory exploration results.
The exploration and development of mineral deposits involve significant
financial risks over an extended period of time, which even a combination of
careful evaluation, experience and knowledge may not eliminate. While discovery
of a mine may result in substantial rewards, few properties which are explored
are ultimately developed into producing mines. Major expenses may be required to
establish mineral resources and mineral reserves by drilling and to construct
mining and processing facilities at a site. It is impossible to ensure that the
current or proposed exploration programs on the Companys mineral resource
properties will result in a profitable commercial mining operation.

Whether a mineral deposit will be commercially viable depends
on a number of factors, which include, among other things: the accuracy of
reserve estimates; the particular attributes of the deposit, such as its size
and grade; ability to economically recover commercial quantities of the
minerals; proximity to infrastructure; financing costs and governmental
regulations, including regulations relating to prices, taxes, royalties;
infrastructure; land use; importing and exporting and environmental protection.
Development, expansion and restarting projects are also subject to the
successful completion of engineering studies, issuance of necessary governmental
permits and availability of adequate financing, and that engineering and
construction timetables and capital costs for the Companys development and
expansion projects and restarting projects on standby, are not incorrectly
estimated or affected by unforeseen circumstances. The effect of these factors
cannot be accurately predicted, but the combination of these factors may result
in the Company not receiving an adequate return on invested capital.

It is possible that actual costs and economic returns of
current and new mining operations may differ materially from the Companys best
estimates. It is not unusual in the mining industry for new mining operations to
experience unexpected problems during the start-up phase, take much longer than
originally anticipated to bring into a producing phase, and to require more
capital than anticipated.

The Companys Mineral Reserves and Resources are
Estimates

Mineral reserves and resources are statistical estimates of
mineral content, based on limited information acquired through drilling and
other sampling methods, and require judgmental interpretations of geology.
Successful extraction requires safe and efficient mining and processing. The
Companys mineral reserves and resources are estimates, and no assurance can be
given that the estimated resources are accurate or that the indicated level of
uranium or vanadium will be produced. Such estimates are, in large part, based
on interpretations of geological data obtained from drill holes and other
sampling techniques. Actual mineralization or formations may be different from
those predicted. Further, it may take many years from the initial phase of
drilling before production is possible, and during that time the economic
feasibility of exploiting a discovery may change.

Mineral reserve and resource estimates for properties that have
not commenced production are based, in many instances, on limited and widely
spaced drill hole information, which is not necessarily indicative of the
conditions between and around drill holes. Accordingly, such mineral resource
estimates may require revision as more drilling information becomes available or
as actual production experience is gained. It should not be assumed that all or
any part of the Companys mineral resources constitute or will be converted into
reserves. Market price fluctuations of uranium or vanadium as applicable, as
well as increased production and capital costs or reduced recovery rates, may
render the Companys proven and probable reserves unprofitable to develop at a
particular site or sites for periods of time or may render mineral reserves
containing relatively lower grade mineralization uneconomic.

- 29 -

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|ENERGY FUELS INC.                                                     
|----------------------------------------------------------------------
|Managements Discussion and Analysis                                  
|15 Months Ended December 31, 2013                                     
|(Expressed in
      thousands of U.S. Dollars, Unless Otherwise Noted)

Environmental Regulatory Requirements and
Risk

The Company is required to comply with environmental protection
laws and regulations and permitting requirements promulgated by federal agencies
and various states and counties in which the Company operates, in connection
with mining and milling operations. The uranium industry is subject not only to
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 Company expends significant resources, both financial and
managerial, to comply with these laws and regulations. The possibility of more
stringent regulations exists in the areas of worker health and safety, storage
of hazardous materials, standards for heavy equipment used in mining or milling,
the disposition of wastes, the decommissioning and reclamation of exploration,
mining, milling and in-situ sites, climate change and other environmental
matters, each of which could have a material adverse effect on the cost or the
viability of a particular project.

The Company cannot predict what environmental legislation,
regulations or policies will be enacted or adopted in the future or how future
laws and regulations will be administered or interpreted. The recent trend in
environmental legislation and regulation is generally toward stricter standards,
and this trend is likely to continue in the future. This recent trend includes,
without limitation, laws and regulations relating to air and water quality, mine
reclamation, waste handling and disposal, the protection of certain species and
the preservation of certain lands. These regulations may require the acquisition
of permits or other authorizations for certain activities. These laws and
regulations may also limit or prohibit activities on certain lands. Compliance
with more stringent laws and regulations, as well as potentially more vigorous
enforcement policies, stricter interpretation of existing laws and stricter
permit and license conditions, may necessitate significant capital outlays, may
materially affect the Companys results of operations and business or may cause
material changes or delays in the Companys intended activities. There can be no
assurance of the Companys continued compliance or ability to meet stricter
environmental laws and regulations and permit or license conditions. Delays in
obtaining permits and licenses could impact expected production levels or
increases in expected production levels.

The Companys operations may require additional analysis in the
future including environmental, cultural and social impact and other related
studies. Certain activities require the submission and approval of environmental
impact assessments. The Company cannot provide assurance that it will be able to
obtain or maintain all necessary permits that may be required to continue
operations or exploration and development of its properties or, if feasible, to
commence construction or operation of mining facilities at such properties on
terms that enable operations to be conducted at economically justifiable costs.
If the Company is unable to obtain or maintain, licenses, permits or other
rights for development of its properties, or otherwise fails to manage
adequately future environmental issues, its operations could be materially and
adversely affected.

Opposition to Mining may Disrupt Business
Activity

In recent years, governmental and non-governmental agencies,
individuals, communities and courts have become more vocal and active with
respect to their opposition of certain mining and business activities including
with respect to the commencement and recommencement of mining at the Company's
mines, such as the Canyon Mine. This opposition may take on forms such as road
blockades, applications for injunctions seeking work stoppages, refusals to
grant access to lands or to sell lands on commercially viable terms, lawsuits
for damages or to revoke or modify licenses and permits, issuances of
unfavourable laws and regulations, and other rulings contrary to an entitys
interest. These actions can occur in response to current activities or in
respect of mines that are decades old. Opposition to the Companys business
activities are beyond the Companys control. Any opposition to the Companys
business activities may cause a disruption to the Companys business activities
and may result in increased costs and this could have a material adverse effect
on the Companys business and financial condition.

Competition for Properties and Experienced
Employees

The Company competes with other mining companies and
individuals for capital, mining interests on exploration properties and
undeveloped lands, acquisitions of mineral resources and reserves and other
mining assets, which may increase its cost of acquiring suitable claims,
properties and assets, and the Company also competes with other mining companies
to attract and retain key executives and employees. There can be no assurance
that the Company will continue to be able to compete successfully with its
competitors in acquiring such properties and assets or in attracting and
retaining skilled and experienced employees. The mining industry has been
impacted by increased worldwide demand for critical resources such as input
commodities, drilling equipment, tires and skilled labour, and these shortages have caused unanticipated cost
increases and delays in delivery times, thereby impacting operating costs,
capital expenditures and production schedules.

- 30 -

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|ENERGY FUELS INC.                                                     
|----------------------------------------------------------------------
|Managements Discussion and Analysis                                  
|15 Months Ended December 31, 2013                                     
|(Expressed in
      thousands of U.S. Dollars, Unless Otherwise Noted)

Litigation and Other Legal Proceedings

The Company is subject to litigation and other legal
proceedings arising in the normal course of business and may be involved in
disputes with other parties in the future which may result in litigation. The
causes of potential future litigation and legal proceedings cannot be known and
may arise from, among other things, business activities, environmental laws,
volatility in stock price or failure to comply with disclosure obligations. The
results of litigation and proceedings cannot be predicted with certainty, and
may include potential injunctions pending the outcome of such litigation and
proceedings. If the Company is unable to resolve these disputes favourably, it
may have a material adverse impact on the Companys financial performance, cash
flow and results of operations.

Decommissioning and Reclamation

As owner and operator of the White Mesa Mill and numerous
uranium and uranium/vanadium mines located in the United States and certain
exploration properties, and for so long as the Company remains an owner thereof,
the Company is obligated to eventually reclaim or participate in the reclamation
of such properties. Most, but not all, of the Companys reclamation obligations
are bonded, and cash and other assets of the Company have been reserved to
secure a portion but not all of this bonded amount. Although the Companys
financial statements will record a liability for the asset retirement
obligation, 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 to be provided on the Companys financial statements. Further, to the
extent the bonded amounts are not fully collateralized, the Company will be
required to come up with additional cash to perform its reclamation obligations
when they occur.

Decommissioning plans for the Companys properties have been
filed with applicable regulatory authorities. These regulatory authorities have
accepted the decommissioning plans in concept, not upon a detailed performance
forecast, which has not yet been generated. As the Companys properties approach
or go into decommissioning, further regulatory review of the decommissioning
plans may result in additional decommissioning requirements, associated costs
and the requirement to provide additional financial assurances. It is not
possible to predict what level of decommissioning and reclamation (and financial
assurances relating thereto) may be required in the future by regulatory
authorities.

Technical Innovation and Obsolescence

Requirements for the Companys products and services may be
affected by technological changes in nuclear reactors, enrichment and used
uranium fuel reprocessing. These technological changes could reduce the demand
for uranium. In addition, the Companys competitors may adopt technological
advancements that give them an advantage over the Company.

Property Title Risk

The Company has investigated its rights to explore and exploit
all of its material properties and, to the best of its knowledge, those rights
are in good standing. However, no assurance can be given that such rights will
not be revoked, or significantly altered, to the Companys detriment. There can
also be no assurance that the Companys rights will not be challenged or
impugned by third parties, including by local governments.

The validity of unpatented mining claims on U.S. public lands
is sometimes difficult to confirm and may be contested. Due to the extensive
requirements and associated expense required to obtain and maintain mining
rights on U.S. public lands, the Company's U.S. properties are subject to
various title uncertainties which are common to the industry or the geographic
location of such claims, with the attendant risk that there may be defects in
its title. In addition, the Secretary of the Interior has withdrawn certain
lands around the Grand Canyon National Park from location and entry under the
Mining Laws. All of the Companys material Arizona Strip properties are located
on these withdrawn lands. No new mining claims may be filed on the withdrawn
lands and no new plans of operations may be approved, other than plans of
operations on mining claims that were valid at the time of withdrawal and that
remain valid at the time of plan approval. Whether or not a mining claim is
valid must be determined by a mineral examination conducted by BLM or USFS, as
applicable. The mineral examination, which involves an economic evaluation of a
project, must demonstrate the existence of a locatable mineral resource and that
the mineral resource constitutes discovery of a valuable mineral deposit. The
Company believes that all of its material Arizona Strip projects are on valid
mining claims that would withstand a mineral examination. Further, the Companys
Arizona 1 and Pinenut mines have approved plans of operations which, absent
modification, would not require a mineral examination. Although the Companys Canyon Mine also has an
approved plan of operations, which, absent modification, would not require a
mineral examination, the USFS performed a mineral examination at that mine in
2012, and concluded that the underlying mining claims were valid existing
rights. However, market conditions may postpone or prevent the performance of
mineral examinations on certain other properties and, if a mineral examination
is performed on a property, there can be no guarantee that the mineral
examination would not result in one or more of the Companys mining claims being
considered invalid, which could prevent a project from proceeding.

- 31 -

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|ENERGY FUELS INC.                                                     
|----------------------------------------------------------------------
|Managements Discussion and Analysis                                  
|15 Months Ended December 31, 2013                                     
|(Expressed in
      thousands of U.S. Dollars, Unless Otherwise Noted)

Foreign Currency Risks

The Companys operations are subject to foreign currency
fluctuations. The Companys operating expenses and revenues are primarily
incurred in U.S. dollars, while some of its cash balances and expenses are
measured in Canadian dollars. The fluctuation of the Canadian dollar in relation
to the U.S. dollar will consequently have an impact upon the profitability of
the Company and may also affect the value of the Companys assets and
shareholders equity.

Post-Acquisition Success

The Company may not realize the anticipated benefits of
acquiring the US Mining Division or completing the Strathmore Acquisition, due
to integration and operational challenges, and to decreases in commodity prices
that have required the Company to place a number of acquired mines on standby
and to defer permitting and development activities on certain other acquired
assets, until market conditions warrant otherwise. The success of the Company
following those acquisitions will depend in large part on the success of the
Companys management in integrating the US Mining Division and the Strathmore
assets into the Company. The failure of the Company to achieve such integration
and to mine or advance such assets could result in the failure of the Company to
realize the anticipated benefits of the Denison Acquisition and Strathmore
Acquisition and could impair the results of operations, profitability and
financial results of the Company.

Production Estimates and Production
Efficiency

The Company may from time to time prepare estimates of future
production or increases in production for particular operations, or relating to
the Companys ability to increase production in response to increases in
commodity prices, as market conditions warrant or otherwise. No assurance can be
given that any such production estimates will be achieved nor can assurance be
given that production or production increases will be achieved in a cost
effective or timely manner. Failure to achieve production estimates or failure
to achieve production in a cost effective or timely manner could have an adverse
impact on the Companys future cash flows, earnings, results of operations and
financial condition. These production estimates are based on, among other
things, the following factors: the accuracy of mineral reserve estimates; the
accuracy of assumptions regarding ground conditions and physical characteristics
of ores, such as hardness and presence or absence of particular metallurgical
characteristics; the accuracy of estimated rates and costs of mining and
processing; assumptions as to future commodity prices; assumptions relating to
changes in laws, regulations or policies, or lack thereof, that could impact the
cost and time required to obtain regulatory approvals, licenses and permits;
assumptions relating to obtaining required licenses and permits in a timely
manner, including the time required to satisfy environmental analyses,
consultations and public input processes; assumptions relating to challenges to
or delays in the licensing and permitting process; and assumptions regarding any
appeals or lack thereof, or injunctions or lack thereof, relating to any
approvals, licenses or permits.

The Companys actual production may vary from estimates for a
variety of reasons, including, among others: actual ore mined varying from
estimates of grade, tonnage, dilution and metallurgical and other
characteristics; short term operating factors relating to the mineral reserves,
such as the need for sequential development of ore bodies and the processing of
new or different ore grades; risk and hazards associated with mining; natural
phenomena, such as inclement weather conditions, underground floods,
earthquakes, pit wall failures and cave-ins; unexpected labor shortages or
strikes; varying conditions in the commodities markets; and delays in obtaining
or denial, challenges or appeals of regulatory approvals, licenses and permits
or renewals of existing approvals, licenses or permits.

Dependence on Issuance of Mill Licence Amendments and
Renewals

The Company maintains regulatory licenses and permits in order
to operate its White Mesa Mill, all of which are subject to renewal from time to
time and are required in order for the Company to operate in compliance with
applicable laws and regulations. In addition, depending on the Companys
business requirements, it may be necessary or desirable to seek amendments to one or more of its
licenses or permits from time to time. While the Company has been successful in
renewing its licenses and permits on a timely basis in the past and in obtaining
such amendments as have been necessary or desirable, there can be no assurance
that such license and permit renewals and amendments will be issued by
applicable regulatory authorities on a timely basis or at all in the future.

- 32 -

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|ENERGY FUELS INC.                                                     
|----------------------------------------------------------------------
|Managements Discussion and Analysis                                  
|15 Months Ended December 31, 2013                                     
|(Expressed in
      thousands of U.S. Dollars, Unless Otherwise Noted)

Mining, Milling and Insurance

The operations of the Company are subject to all of the hazards
and risks normally incidental to exploration, development and mining of mineral
properties, and milling, including: environmental hazards; industrial accidents;
labor disputes, disturbances and unavailability of skilled labor; encountering
unusual or unexpected geologic formations; rock bursts, pressures, cave-ins,
flooding; periodic interruptions due to inclement or hazardous weather
conditions; technological and processing problems, including unanticipated
metallurgical difficulties, ground control problems, process upsets and
equipment malfunctions; the availability and/or fluctuations in the costs of raw
materials and consumables used in the Companys production processes; the
ability to procure mining equipment and operating supplies in sufficient
quantities and on a timely basis; and other mining, milling and processing
risks, as well as risks associated with the Companys dependence on third
parties in the provision of transportation and other critical services. Many of
the foregoing risks and hazards could result in damage to, or destruction of,
the Companys mineral properties or processing facilities, personal injury or
death, environmental damage, delays in or interruption of or cessation of
production from the Companys mines or processing facilities or in its
exploration or development activities, delay in or inability to receive
regulatory approvals to transport its uranium concentrates, or costs, monetary
losses and potential legal liability and adverse governmental action. In
addition, due to the radioactive nature of the materials handled in uranium
mining and processing, additional costs and risks are incurred by the Company on
a regular and ongoing basis.

While the Company may obtain insurance against certain risks in
such amounts as it considers adequate, the nature of these risks are such that
liabilities could exceed policy limits or could be excluded from coverage. There
are also risks against which the Company cannot insure or against which it may
elect not to insure. The potential costs which could be associated with any
liabilities not covered by insurance or in excess of insurance coverage or
compliance with applicable laws and regulations may cause substantial delays and
require significant capital outlays, adversely affecting the future earnings,
financial position and competitive position of the Company. No assurance can be
given that such insurance will continue to be available or will be available at
economically feasible premiums or that it will provide sufficient coverage for
losses related to these or other risks and hazards. This lack of insurance
coverage could result in material economic harm to the Company.

Replacement of Mineral Reserves and Resources and
Availability of Alternate Feed Materials

The Companys mineral reserves and resources at its Roca Honda,
Arizona Strip, EZ Complex, Sage Plain, Henry Mountains, Daneros, Sheep Mountain,
Gas Hills, Juniper Ridge, Whirlwind,and La Sal projects are
the Companys primary sources (and potential sources) of uranium concentrates.
Unless other mineral reserves and resources are discovered or extensions to
existing ore bodies are found, the Companys sources of production for uranium
concentrates will decrease over time as its current mineral reserves and
resources are depleted. There can be no assurance that the Companys future
exploration, development and acquisition efforts will be successful in
replenishing its mineral reserves and resources. In addition, while the Company
believes that many of its properties will eventually be put into production,
there can be no assurance that they will be or that they will be able to replace
current production.

The Company also produces uranium from processing alternate
feed materials at its White Mesa Mill. There can be no assurance that additional
sources of alternate feed materials will be forthcoming in the future on
commercially acceptable terms or otherwise, or that the Company will be
successful in receiving all required regulatory approvals, licenses and permits
on a timely basis to allow for the receipt and processing of any such alternate
feed materials.

Credit Risk

The Companys sales of uranium and vanadium products expose
Energy Fuels to the risk of non-payment. The Company manages this risk by
monitoring the credit worthiness of its customers and requiring pre-payment or
other forms of payment security from customers with an unacceptable level of
credit risk.

- 33 -

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|ENERGY FUELS INC.                                                     
|----------------------------------------------------------------------
|Managements Discussion and Analysis                                  
|15 Months Ended December 31, 2013                                     
|(Expressed in
      thousands of U.S. Dollars, Unless Otherwise Noted)

Dependence on Key Personnel and Qualified and Experienced
Employees

The Companys success will largely depend on the efforts and
abilities of certain senior officers and key employees, some of which are
approaching retirement. Certain of these individuals have significant experience
in the uranium 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, other than
through retirement, if for any reason they do not, the Company could be
adversely affected. The Company has not purchased key man life insurance for any
of these individuals, other than for the Chief Executive Officer.

The Companys success will also depend on the availability of
qualified and experienced employees to work in the Companys operations and the
Companys ability to attract and retain such employees. The number of
individuals with relevant mining and operational experience in this industry is
small.

Disclosure and Internal Controls

Internal controls over financial reporting are procedures
designed to provide reasonable assurance that transactions are properly
authorized, assets are safeguarded against unauthorized or improper use, and
transactions are properly recorded and reported. Disclosure controls and
procedures are designed to ensure that information required to be disclosed by a
company in reports filed with securities regulatory agencies is recorded,
processed, summarized and reported on a timely basis and is accumulated and
communicated to a companys management, including its chief executive officer
and chief financial officer, as appropriate, to allow timely decisions regarding
required disclosure. A control system, no matter how well designed and operated,
can provide only reasonable, not absolute, assurance with respect to the
reliability of reporting, including financial reporting and financial statement
preparation.

Dependence on Business Partners and Government of Third
Party Consents

The Company has a number of joint ventures and other business
relationships relating to its properties and projects, including key projects,
such as the Roca Honda and Gas Hills projects, which can restrict the ability of
the Company to act unilaterally with respect to those projects in certain
circumstances. There can be no assurances that the Company will be able to
maintain relationships with its joint venture and business partners to allow for
satisfactory permitting, development, mining or milling relating to any such
projects. The Companys operations are also dependent from time to time on
receiving government and other third party consents and approvals. There can be
no assurances that all such consents and approvals will be forthcoming when
required.

Conflicts of Interest

Some of the directors of the Company are also directors of
other companies that are similarly engaged in the business of acquiring,
exploring and developing natural resource properties. Such associations may give
rise to conflicts of interest from time to time. In particular, one of the
consequences will be that corporate opportunities presented to a director of the
Company may be offered to another company or companies with which the director
is associated, and may not be presented or made available to the Company. The
directors of the Company are required by law to act honestly and in good faith
with a view to the best interests of the Company, to disclose any interest which
they may have in any project or opportunity of the Company, and to abstain from
voting on such matter. Conflicts of interest that arise will be subject to and
governed by the procedures prescribed in the Companys Code of Ethics and by the
Business Corporations Act (Ontario).

Labor Relations

None of the Companys operations directly employ unionized
workers who work under collective agreements. However, there can be no assurance
that employees of the Company or its contractors do not become unionized in the
future, which may impact mill and mining operations. Any lengthy work stoppages
may have a material adverse impact on the Companys future cash flows, earnings,
results of operations and financial condition.

Infrastructure

Mining, processing, development and exploration activities
depend, to a substantial degree, on adequate infrastructure. Reliable roads,
bridges, power sources and water supply are important determinants affecting
capital and operating costs. The Company considers the existing infrastructure
to be adequate to support its proposed operations. However, unusual or
infrequent weather phenomena, sabotage, government or other interference in the maintenance or provision of such infrastructure could adversely
affect the operations, financial condition and results of operations of the
Company.

- 34 -

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|ENERGY FUELS INC.                                                     
|----------------------------------------------------------------------
|Managements Discussion and Analysis                                  
|15 Months Ended December 31, 2013                                     
|(Expressed in
      thousands of U.S. Dollars, Unless Otherwise Noted)

QUALIFIED PERSON

The disclosure of scientific and technical information
regarding Energy Fuels properties in this MD&A was prepared under the
supervision of Stephen P. Antony, P.E. President and Chief Executive Officer of
Energy Fuels, who is a Qualified Person in accordance with the requirements of
National Instrument 43-101.

- 35 -

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